European stocks set to end week at record high

Published: July 27, 2018 16:18:07 | Updated: July 30, 2018 09:54:45

European shares inched up in early trading on Friday and were set to end the week at six-week highs, helped by an easing of fears over US tariffs and good company results.

Shares in consumer goods company Reckitt Benckiser (RB.L), construction groups Saint Gobain and Vinci, BT and bank BBVA rose following well-received results, lifting the pan-European STOXX 600 benchmark up 0.17 per cent by 0856 GMT.

According to Deutsche Bank, European second-quarter EPS growth has accelerated to 6.0 per cent from 0 per cent in the first, a result they said was good given the deterioration in euro area growth momentum seen in the period.

Hopes of a breakthrough in US-EU trade talks lifted the STOXX to its highest level since mid-June on Thursday as carmakers, which rely on exports for growth, rose sharply. The index was on track to end the week up 1.4 per cent.

Investors however kept a degree of caution, reports Reuters.

The US Commerce Department will continue its probe into whether auto imports pose a national security risk despite ongoing trade talks with the EU, but US President Donald Trump asked that no action be taken at this time, Commerce Secretary Wilbur Ross said on Thursday.

Autos shares were little changed Friday. Renault rose 1.4 per cent after a volatile start as the French carmaker achieved record profitability in the first half as emerging market sales surged.

Shares in German carmakers—BMW and Daimler—are heavily exposed to the US market, however slipped slightly.

Mining company BHP Billiton rose 3.7 per cent after BP agreed to buy its US shale oil and gas assets for $10.5 billion. BP shares fell 1.0 per cent.

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