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Europe close: Stocks brush off global trade and Brexit concerns as euro dips

By Alexander Bueso

Date: Tuesday 16 Jul 2019

Europe close: Stocks brush off global trade and Brexit concerns as euro dips

(Sharecast News) - Stocks rose across the Continent even as a key survey of investor confidence highlighted the ongoing concerns around the US-China trade spat and Brexit and the acting chief of the International Monetary Fund sounded a word of caution on the global economic outlook - all thanks to a weaker euro.
"European markets are outperforming their US counterparts today, as the recent impact of a weakening dollar begins to unwind," explained IG's Josh Mahony.

"The notable effect of last week's appearances from Powell have been easing back of late, with an improved retail sales figure providing markets with greater confidence that it will only be a 25-basis point move from the Fed."

According to the US Department of Commerce, US retail sales volumes increased at a 0.4% month-on-month clip in June, doubling forecasts.

By the end of trading, the benchmark Stoxx 600 was 0.35% higher at 389.10, while the Dax had gained 0.35% to 12,430.97 and the FTSE Mibtel had edged up by 0.12% at 22,204.08.

Euro/dollar meanwhile was trading 0.38% lower to 1.12165 and front month Brent crude oil futures were down by 0.1% to $66.42 a barrel on the ICE.

Back in Europe, the ZEW institute's economic sentiment index for Germany slipped by 3.4 points in July versus the month before to reach -24.5 (consensus: 22.0).

Commenting on the report, ZEW President Achim Wambach said that there had been no let up in the factors weighing on the outlook for German exports, inlcuding on Iran or the US-China trade dispute, while "no discernible progress has been made in the negotiations as to what Brexit will look like."

On a related note, the IMF's acting managing director, David Lipton, told Bloomberg TV in an interview that central banks around the world should stand ready to help should economic growth slow even more rapidly.

On a more positive note, Eurostat reported that in seasonally adjusted terms the euro area's trade surplus rose from €15.7bn for April to €20.2bn in May (consensus: €17.8bn).


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