Article Highlights

  • European shares edge higher
  • Autos stocks drop after U.S. launches import probe
  • Deutsche Bank announces job cuts, shares turn negative
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A bounce across financials and tech stocks helped Europeanstocks nudge higher on Thursday, though carmakers’ shares came under pressure after the United States launched a probe into auto imports.

The pan-European STOXX 600 index was up 0.3 percent by 0857 GMT, after falling more than 1 percent from a 3 1/2-month peak in the previous session as worries over spending plans from Italy’s new coalition and global trade weighed on risky assets.

Concerns over a U.S.-China trade deal continued after U.S. President Donald Trump said that any deal would need “a different structure.”

“I think (any significant reduction in Chinese trade tariffs) is going to cause a bit of a rebalancing in the Chinese economy and that will have a follow-through on certain companies that are reliant on China for business that are listed in European countries and also the U.S.,” Jonathan Roy, market strategist at Ocean Capital Group, said.

“That’s probably something that will play out over some time. The immediate effects may not be known. A lot of the hype around any trade war being reeled in has been quickly priced back into the market,” Roy added.

German carmakers BMW, Daimler and Volkswagen dropped 1.8 to 2.8 percent after the United States launched a national security investigation into car and truck imports that could lead to new U.S. tariffs.

Germany’s benchmark DAX index inched 0.1 percent higher and Europe’s autos sector was the worst-performing, losing 1.4 percent.

But a bounce among financials and tech stocks helped European markets rise. Minutes from the U.S. Federal Reserve’s last meeting indicated that the central bank would maintain a gradual approach to rate hikes, something seen as supportive of risky assets.

Italy’s FTSE MIB was up 0.9 percent after Italy’s president invited political novice Giuseppe Conte to be prime minister.

Aryzta was a standout faller among individual stocks. Shares in the Swiss food company slumped 28 percent after the firm cut its full year earnings outlook once more.

Elsewhere shares in Deutsche Bank reversed slight gains from earlier on to trade 0.1 percent lower after the bank said it would cut thousands of staff in a revamp of its investment bank.

Analysts at KBW Research said in a note they found Deutsche Bank’s finalized business review “disappointing,” adding: “With the revenue loss from front office staff headcount reductions and expectations already at management target levels, we believe this is priced in and therefore leaves execution risk.”

Deutsche Bank’s shares are down around 31 percent so far this year.

UK stocks were among the top gainers on the STOXX 600.

Industrial distribution firm Electrocomponents jumped 9.7 percent after reporting double-digit growth in annual revenue and profit, while food ingredients firm Tate & Lyle rose nearly 7 percent after posting higher annual profits.