European markets track global stocks higher; energy companies offer support
European stocks rose in step with global markets on Friday, with investor enthusiasm driven by hopes over global trade.
Investors also took stock of the latest U.K. parliamentary vote to ask E.U. leaders to extend Britain’s withdrawal from the E.U.
Heavyweight oil and gas helped drive the markets up, particularly the FTSE 100.
How did markets perform?
The Stoxx Europe 600 SXXP, +0.68% added 0.5% to 380.60 on Friday, after finishing the previous day up 0.7%, and was set for a weekly gain of 2.7%.
The U.K.’s FTSE 100 UKX, +0.60% climbed 0.6% to 7,228.75, while France’s CAC 40 PX1, +1.04% rose by 0.9% to 5,399.66.
Germany’s DAX DAX, +0.96% climbed 0.9% to 11,693.53 and Italy’s FTSE MIB index I945, +0.80% gained 0.7% to 21,031.24.
The British pound GBPUSD, +0.3776% remained flat at $1.3236, while the euro EURUSD, +0.1680% climbed to $1.1308, unchanged from late Thursday evening in New York.
What’s driving the markets?
Chinese lawmakers on Friday approved a new law against the forced transfer of technology by foreign companies — a big complaint by the U.S. and other countries. But it remains unclear if the move will be enough to smooth the path to a trade deal.
Meanwhile, U.S. president Donald Trump has threaten the E.U. with “pretty severe” economic pain if Brussels does not engage in trade talks with Washington, the Financial Times reported.
After turbulent week in U.K. parliament, Thursday evening saw MPs vote to extend Article 50 for a short period until June 30. The decision marks end of a intense three days, which during Prime Minister Theresa May’s revised withdrawal agreement was rejected for the second time and MPs voted to rule out to leaving the EU with no deal.
Oil prices have continued to edge higher, as extended OPEC production cuts and lower inventories help support prices. Total S.A. FP, +0.49% rose 1%.
However, U.K. Oil & Gas PLC UKOG, -1.92% fell 2% after announcing its loss for 2018 widened more than seven times as it booked an impairment on exploration write-offs.
What stocks are active?
UBS Group AG UBSG, -1.09% fell 1.6% after the Swiss bank set aside $516 million in provision for a tax case in which French judges ordered the bank to pay a hefty fine for helping wealthy clients in France evade taxes.
H&M Hennes & Mauritz AB Series B HMB, -4.92% slid 4%, despite the high street retailer announcing higher than expected sales for the first quarter.
“In the last two years the company has struggled to hit its sales targets due to large build ups in inventory. The company appears to be succeeding in reducing these over hangs as a result of lowering its prices,” Michael Hewson chief market analyst at CMC Markets UK told clients in a note.
Volkswagen AG VOW, +1.09% rose 0.3% as investors largely brushed aside news the U.S. Securities and Exchange Commission charged the German car maker with defrauding U.S. bond investors.