Markets

European stocks close higher on US-China trade deal hopes

Key Points
  • The pan-European Stoxx 600 closed provisionally up 1%, with bank and technology shares leading the gains.
  • President Trump announced a partial accord will be signed at the White House by senior Chinese negotiators.

European stocks closed higher Thursday after U.S. President Donald Trump said that a phase one trade deal with China will be signed on January 15.

The pan-European Stoxx 600 closed provisionally up by 1%, with bank and technology shares leading the gains as all sectors and major bourses traded firmly in positive territory.

President Trump announced in a tweet on Tuesday that a partial accord will be signed at the White House by senior Chinese negotiators in two weeks' time, though details of the deal remain hazy.

On Wall Street, stocks extended their gains from 2019 on the first trading day of the year. The Dow Jones Industrial Average was up 150 points, while the Nasdaq and S&P 500 indexes were also positive.

Back in Europe, Airbus has become the world's largest airplane manufacturer for the first time since 2011, ousting Boeing from the top spot after beating forecasts on its 863 aircraft in 2019, Reuters reported on Wednesday citing airport and tracking sources. Airbus shares gained more than 2%.

Euro zone manufacturing PMI (purchasing managers' index) data published Thursday morning showed that factory activity contracted for the 11th straight month, coming in at 46.3 in December.

U.K. manufacturing PMI was revised up to 47.5 for December but remained below November's 48.9 reading. The 50 level separates contraction from expansion.

Stocks on the move

German banks were among the biggest gainers Thursday with Commerzbank climbing around 7% while compatriot Deutsche Bank added 6%.

Tullow Oil shares slumped to the bottom of the pan-European benchmark, falling nearly 7% after the British oil company announced the results of drilling at its Carapa-1 well.