European Markets Finish Mixed As Geopolitical Concerns Weigh

The European markets ended Friday’s session with mixed results. Investors were pleased by the solid private sector data from both Germany and the Eurozone at the end of the trading week. However, optimism over the positive data was offset by geopolitical concerns, as tensions between North Korea and the United States flared up again.

North Korean Foreign Minister Ri Yong Ho said his country may consider testing a hydrogen bomb in the Pacific Ocean. North Korean leader Kim Jong Un and President Donald Trump have also been engaging in a war of word.

Kim described Trump’s threat to “totally destroy” North Korea as “mentally deranged behavior.” Trump responded to Kim’s statement with a post on Twitter on Friday, calling the North Korean dictator a “madman.”

U.K. Prime Minister Theresa May hinted at the departure from the European Union by March 2019.

“We are moving through a new and critical period in the history of the United Kingdom’s relationship with the European Union. The British people have decided to leave the EU and be a global free-trading nation able to chart our own way in the world,” May said at a speech in Florence.

The UK membership in the European Union will end on March 29, 2019, she told. Neither the UK nor the EU could implement a new smooth relationship at that point.

May said that it is impossible to have all the advantages of the single market with none of the disadvantages. Hence, a “creative” economic partnership was needed.

The pan-European Stoxx Europe 600 index advanced 0.05 percent. The Euro Stoxx 50 index of eurozone blue chip stocks increased 0.03 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.06 percent.

The DAX of Germany dropped 0.06 percent, but the CAC 40 of France rose 0.27 percent. The FTSE 100 of the U.K. gained 0.64 percent and the SMI of Switzerland finished higher by 0.03 percent.

In Paris, cosmetics giant L’Oreal rallied 2.46 percent on speculation about the future of the company after billionaire Liliane Bettencourt died at the age of 94.

In London, outsourcing firm Capita lost 1.23 percent as staff represented by trade union Unite has voted in favor of industrial action.

Smiths Group dropped 5.83 percent after the conglomerate reported a fall in underlying full-year revenue.

Telecom company Telia slid 0.34 percent in Stockholm after it agreed to pay a combined total penalty of more than $965 million to resolve charges arising out of a scheme to pay bribes in Uzbekistan.


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