Stocks in Europe open mixed as trade war threatens to become tech war
Stocks in Europe opened mixed Wednesday, as investors monitor the increasing involvement of technology giants in the U.S.-China trade war.
The pan-European STOXX 600 edged lower at the opening bell, telecoms showing an early 0.4% drop while autos led marginal gains in the early minutes of trading.
Investors will be monitoring trade developments between the world’s two largest economies, after a reprieve from the U.S. temporarily backing off its blacklisting of Chinese telecommunications giant Huawei caused European markets to rebound slightly Tuesday.
Markets in Asia were subdued Wednesday afternoon, with mainland Chinese shares largely flat while indexes in Japan, Hong Kong and South Korea showed slight gains.
China’s GAC Motor, one of the nation’s largest carmakers, postponed its U.S. launch due to uncertainty over the trade war, while Tencent CEO Pony Ma said he was watching whether a tech war will ensue. Meanwhile, Chinese President Xi Jinping said China is embarking on a “new Long March,” suggesting no imminent end to the trade war.
Stateside, investors will also be monitoring domestic and geopolitical developments, as House Democrats subpoenaed two more former White House aides just hours after former White House Counsel Donald McGahn no-showed for testimony at President Trump’s request.
The State Department said Tuesday that it sees signs the Syrian government may be using chemical weapons, warning that Washington and its allies would respond “quickly and appropriately” should the allegations be proven.
Back in Europe, U.K. Prime Minister Theresa May sought to break the Brexit deadlock with the main opposition Labour Party and pro-European Union lawmakers, offering Members of Parliament a vote on whether to hold another referendum if they back her EU Withdrawal Agreement Bill.
Meanwhile, the Austrian far right FPO crashed out of the country’s coalition government after the President sided with Conservative Chancellor Sebastian Kurz and sacked its interior minister following a sting video.
In corporate news, German lender Commerzbank will hold its AGM Wednesday following the collapse of merger talks with domestic rival Deutsche Bank. Elsewhere, British retailer Marks & Spencer will report full-year results along with Royal Mail, which is expected to report a slump in profits.