European markets close higher after US payrolls data; Ferrari up 7.7%

Big 5

European markets closed higher Friday as investors monitored trade talks between the U.S. and China and digested key economic data, according to CNBC

The pan-European Stoxx 600 closed provisionally more than 0.6 percent higher with the majority of sectors and major bourses edging higher. Media stocks were among the best performers, with Pearson leading the gains in the sector. The educational publisher said in a trading update that it was on track to grow to underlying profit this year. The stock shot up by more than 7.6 percent.

Looking at the European benchmark, Ferrari led the gains and its share price hit a record high, after better-than-expected earnings led to a number of ratings upgrades for the automaker. The stock was up 7.7 percent.

It was a tough trading day for French banks, however, after reporting their latest figures. Societe Generale sank near to the bottom of the European benchmark, down by more than 5 percent.

Net banking income stood at 6.294 billion euros for its first quarter of 2018 — a drop of 2.5 percent from a year ago. This was due to a weaker performance in its domestic retail activity, as well as lower revenues in its global banking and investor solutions division.

BNP Paribas was off by more than 1 percent. It reported a 17 percent fall in net income during the first quarter of the year, highlighting “lackluster” trading activity in Europe.

U.S. authorities accused former Volkswagen chief Martin Winterkorn of conspiring to cover up the German automaker’s diesel emissions cheating, Reuters reported.

In Italy, Telecom Italia shareholders voted to form a new board; Elliott Management won the vote, securing two-thirds of seats on the board.

On Wall Street, stocks rose as traders shrugged off disappointing numbers in the government’s monthly jobs report and Apple shares hit an all-time high.

The unemployment rate fell to 3.9 in the U.S. while nonfarm payrolls rose by a worse-than-expected 164,000. Nonfarm payrolls data is particularly important to assess the health of the U.S. economy and project whether the Federal Reserve is going to increase rates.

Trade talks between China and the U.S. carried on for their second and likely final day. U.S. Treasury Secretary Steven Mnuchin said on Friday that the discussions have been very good. Markets fear that there could be a trade war between both countries if an agreement isn’t reached.

Earlier, services PMIs in Spain showed a slowdown in recent months, as job creation also took a breather. There will also be services PMIs in Germany at 08:55 a.m. London time. On Thursday, European bond yields fell across the region following disappointing inflation numbers.