Europe close: Stocks edge higher after US-Mexico trade spat averted
Stock markets across the Continent finished the Monday session slightly higher, with investors breathing a sigh of relief after the US and Mexico reached a deal to avoid another trade spat, although the latest headlines around the US-China trade war were somewhat mixed.
"For now, markets are reacting with relief that the US has not opened up yet another front to their trade war. However, this whole debacle also highlights the worrying fact that Trump sees tariffs as an appropriate tool to utilise in any situation where he feels the US has been slighted in some way," said IG's Josh Mahony.
During the previous Friday, Mexico agreed to dispatch 6,000 national guardsmen to its own southern border in order to stem the flow of migrants from Central America and to accept the return of asylum seekers already in the US while their petitions to enter the country were processed.
By the end of trading, the benchmark Stoxx 600 index had added 0.21% to 378.27, alongside a rise of 0.63% for Spain's Ibex 35 to 9,294.10 and a gain of 0.61% for the FTSE Mibtel to 20,484.99.
The German and Swiss stock exchanges were closed for Whit Monday.
In parallel, front month Brent crude oil futures off by 0.50% to $62.97 a barrel on the ICE.
And regarding China, on Sunday US Treasury Secretary Steve Mnuchin said that he had met with the head of the People's Bank of China on the margins of the meeting of G-20 finance ministers and central bankers, in Fukuoka, Japan, saying he had a "constructive" meeting, including a "candid" discussion trade.
Later the same day, in remarks broadcaster CNBC, Mnuchin said: "If China doesn’t want to move forward, then President Trump is perfectly happy to move forward with tariffs to re-balance the relationship."
The US President was widely expected to meet with his Chinese counterpart, Xi Jinping, at the G-20 leaders' summit scheduled for the end of the month, also in Japan.
Following in Mnuchin's wake, and also on CNBC, Trump threatened to enact further tariffs if Xi did not meet with him on 28-29 June.
On the economic front, the news was decidedly downbeat, with the latest Chinese import data pointing to still weak domestic economic conditions, while in the UK the latest data revealed a large drop in economic activity as payback after firms' accelerated stockpiling of goods ahead of the originally planned date for Brexit, at the end of March, came to a halt.
According to China's customs administration, the country´s imports declined at a year-on-year clip of -8.5% in May (consensus: -3.5%) following a rise of 4.0% in April, even as export growth surprised to the upside, rising by 1.1% on the year (consensus: -3.9%).
Meanwhile, in the UK, a reading on monthly gross domestic product from the Office for National Statistics printed at -0.4%, which was considerably worse than the 0.1% dip that most analysts had penciled-in.