European stocks open higher Wednesday, with investors focusing on political developments in Europe and the latest chapter in the trade dispute between the the United States and China.
The pan-European Stoxx 600 was 0.12 percent higher with most sectors moving in positive territory.
Italy’s incoming coalition government won its first confidence vote by the Senate on Tuesday evening. New Prime Minister Giuseppe Conte presented the coalition’s plans to crackdown on immigration and up welfare spending while cutting taxes.
But Jens Weidmann, head of Germany’s central bank, warned that the market reaction to Italy’s unstable politics demonstrates that the euro zone is yet to be fully “crisis proof.” Speaking on the side lines of a meeting in Canada of G7 finance ministers and central bank bosses, he added that more reforms are needed both on a national and European level.
Elsewhere in Europe, Spain’s cabinet under new Prime Minister Pedro Sanchez has begun to materialize with key ministerial positions being hinted at Tuesday. The cabinet will be officially announced on Wednesday.
With regards to European corporate news, the U.K. government announced on Tuesday that it was prepared to give Rupert Murdoch’s Fox the go-ahead to buy the 61 percent of broadcaster Sky that it does not already own. This could result in a bidding war between Fox and U.S. media giant Comcast for the asset.
World trade continues to dominate investors’ agenda. On Tuesday it was announced that U.S. lawmakers intend to introduce legislation that would force President Donald Trump to obtain approval from Congress before tariffs on national security grounds can be imposed.
Meanwhile, Trump met with trade advisers on Tuesday to discuss the possibility of China importing an additional $70 billion of U.S. goods – the next step in diffusing a trade dispute between the world’s two largest economies.