By Sara Sjolin, MarketWatch
Germany's DAX reopens after connectivity glitch
European stock markets ended a choppy day in positive territory
on Friday, tracking U.S. markets higher as a spate of positive data
gave traders a reason to shake off concerns over another impending
prominent departure from the White House.
The euro declined against the dollar after disappointing
inflation figures and the U.S. data, providing a lift to Europe's
big exporters.
How did benchmarks perform?
The Stoxx Europe 600 index ended up 0.2% at 377.71, trimming its
weekly decline to 0.1%.
Germany's DAX 30 index rose 0.4% to 12,389.58. Trading in
Frankfurt opened about 40 minutes late on Friday
(http://www.marketwatch.com/story/germanys-dax-to-reopen-after-unknown-glitch-2018-03-16)
after a connectivity issue that prevented equal access for market
participants to the trading system.
France's CAC 40 index climbed 0.3% to 5,282.75, while the U.K.'s
FTSE 100 closed up 0.3% at 7,164.14
(http://www.marketwatch.com/story/ftse-100-trudges-higher-but-home-builders-keep-a-lid-on-bigger-gains-2018-03-16).
Read:Pound could surge in 'frenetic' week of Brexit and BOE
news, ING says
(http://www.marketwatch.com/story/pound-could-surge-in-frenetic-week-of-brexit-and-boe-news-ing-says-2018-03-16)
What was driving the market?
European markets had been all over the map on Friday, but
decisively moved higher after upbeat data from the U.S. There,
industrial production rose the most in four months in February
(http://www.marketwatch.com/story/industrial-production-jumps-11-in-february-biggest-gain-in-four-months-2018-03-16),
while the University of Michigan's consumer-sentiment index jumped
to a 14-year high in March
(http://www.marketwatch.com/story/consumer-sentiment-hits-14-year-high-as-low-income-households-report-better-conditions-2018-03-16).
U.S. stocks also traded higher
(http://www.marketwatch.com/story/us-stock-futures-struggle-as-political-worries-return-to-haunt-investors-2018-03-16).
The encouraging data spurred a rally in the dollar
(http://www.marketwatch.com/story/dollar-slumps-to-9-day-low-against-the-yen-after-reports-trump-plans-to-sack-mcmaster-2018-03-16),
in turn yanking the euro . The shared currency bought $1.2289,
compared with $1.2306 late Thursday in New York. A weaker euro can
help boost European companies as products and services become
cheaper for other currency holders.
The euro had already trimmed its earlier gain in mid-morning
Europe trade after data showed eurozone inflation in the currency
union fell to 1.1% in February
(http://www.marketwatch.com/story/eurozone-inflation-falls-misses-forecasts-2018-03-16),
down from an initial estimate of 1.2% and weaker than the 1.3%
recorded in January. Weaker inflation could deter the European
Central Bank from rolling back its aggressive quantitative-easing
program later this year.
Turmoil in the Trump administration added to Friday's volatile
trade, with the U.S. president expected to fire his national
security adviser H.R. McMaster
(http://www.marketwatch.com/story/trump-poised-to-push-mcmaster-out-of-the-white-house-2018-03-16),
according to news reports, which would be the second high-profile
firing from the White House this week. Secretary of State Rex
Tillerson was replaced with Central Intelligence Agency Director
Mike Pompeo on Tuesday.
White House press secretary Sarah Huckabee Sanders dismissed
that suggestion in a tweet late Thursday, but administration
officials have reportedly confirmed it.
(https://twitter.com/PressSec/status/974468508074565632)
Concerns over a possible trade war between the U.S. and key
trading partners were still weighing on investors' minds as well,
analysts said. The White House said on Wednesday it will seek to
trim the U.S.'s trade deficit with China by $100 billion, using
tariffs. The European Union, meanwhile, was working to get the bloc
exempt from the tariffs.
Which stocks were in focus?
Shares of Siemens Healthineers AG rose 5% as the stock made its
market debut on the Frankfurt Stock Exchange
(http://www.marketwatch.com/story/siemens-healthineers-shares-rise-on-market-debut-2018-03-16-648579).
NEX Group PLC (NXG.LN) rallied 30% after confirming that it's
received a preliminary takeover approach from CME Group Inc
(http://www.marketwatch.com/story/nex-confirms-takeover-approach-by-cme-2018-03-16).
(CME).
Altice NV (ATC.AE) rose 2.7% after the debt-laden telecoms
company late Thursday said underlying earnings rose in the fourth
quarter and that it was seeing some recovery in the French
market.
Berkeley Group Holdings PLC (BKG.LN) dropped 5.4% as the home
builder said while trading conditions in London and the southeast
of the U.K. remain stable it doesn't plan to step up building.
(http://www.marketwatch.com/story/berkeley-projects-no-increase-in-production-2018-03-16)
What were strategists saying?
-- "The fear that the U.S. and China would engage in a trade war
weighed on stocks during the week, but that uncertainty has lifted
for now. As it is potentially going to be a U.S.-instigated trade
war, European dealers are taking their cues from U.S. indices,"
said David Madden, market analyst at CMC Markets UK, in a note.
-- "The latest [inflation] data only strengthens the belief that
we will see significant monetary policy divergence between the U.S.
and eurozone this year," said Jacob Deppe, head of trading at
Infinox, in a note.
"In fact, monetary policy could open a new front in a
U.S./eurozone trade war. European exports, reliant on a cheap Euro,
will benefit from a continuing dovish monetary policy," he
added.
(END) Dow Jones Newswires
March 16, 2018 13:00 ET (17:00 GMT)
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