Europe open: Markets climb on trade deal hopes, German data eyed

European stocks rose on Friday morning, as comments from US Treasury Secretary Steven Mnuchin increased Sino-US trade optimism, while German consumer sentiment missed expectations.

At 0907 GMT, the pan-European Stoxx 600 was 0.4% higher at 416.70, as Germany's DAX jumped by 0.5% to 13,278.03 and the French CAC 40 rose by 0.3% to 5,992.71. Meanwhile, London's FTSE 100 was up by 0.3% at 7,595.74.

Mnuchin said he was confident that negotiators from Washington and Beijing would be able to sign a phase one trade deal in early January following a "technical, legal scrub".

Oanda analyst Craig Erlam said: "I'm not quite sure what that means exactly, but hopefully this isn't the same "done" as we were told in October because those final details took some time to iron out."

Data from the GfK institute showed that German consumer sentiment inched lower to 9.6 in December, dropping below November's reading of 9.7 and falling short of a predicted increase to 9.8.

Pantheon Macroeconomics analyst Claus Vistesen said: "The headline dip is irrelevant—this gauge is not a good leading indicator—but the details, reported for December, were soft. The overall expectations gauge slipped back below zero, to -4.4 from +1.7 in November, while income expectations slumped, almost full reversing the increase last month.

"A small increase in the willingness-to-buy index was the only bright spot. Overall, the survey points still-decent growth in consumers’ spending, but it also suggests that growth will is slowing, following the already solid increase through the first three quarters of 2019."

Among individual stocks, STMicroelectronics climbed after it announced that it will collaborate with Chinese tech giant Tencent's latest 'internet of things' operation system.

Italian payments group Nexi was also in the green after it agreed to buy Intesa SanPaolo's merchant acquiring business for around €1bn.

Spain's Enagas climbed for a second day in a row following news that Zara founder Amancio Ortega has bought a 5% stake in the business.

Royal Dutch Shell was lower after it warned that it will be hit by impairment charges of up to $2.3bn in the fourth quarter, while the company also trimmed its fourth quarter production sales guidance.