European stocks close lower as traders brace for Trump-Juncker summit
European stocks finished modestly lower Wednesday ahead of a key meeting between U.S. President Donald Trump and European Commission President Jean-Claude Juncker that could provide clarity on trade relations between the U.S. and eurozone.
The Stoxx Europe 600 index SXXP, -0.26% dropped 0.3% to close at 387.17, falling back after a 0.9% rally on Tuesday, which was its biggest advance in a month.
The U.K.’s FTSE 100 index UKX, -0.66% lost 0.7% to 7,658.26, paring back from its highest close since June 14, hit on Tuesday.
Germany’s DAX 30 index DAX, -0.87% ended down 0.9% at 12,579.33 on Wednesday, while France’s CAC 40 index PX1, -0.14% slipped 0.1% to 5,426.41. Losses for the French index curbed by LVMH Moët Hennessy Louis Vuitton SE MC, +1.81% rising 1.8% after reporting a 41% jump in first-half profits.
Check out: European luxury stocks face a 30% drop in an all-out trade war, says UBS
The euro EURUSD, -0.0428% was down at $1.1674, compared with $1.1685 late Tuesday in New York, while the pound GBPUSD, +0.0228% was marginally higher at $1.3151.
Markets closed lower in Europe as investors awaited fresh catalysts after Tuesday’s push higher. Earnings were still in focus, with more than 400 companies in the Stoxx 600 still waiting to release results. Of the 140 companies to have reported so far, 37% have beaten earnings forecast, while 61% have exceeded sales expectations.
Across the pond, U.S. President Donald Trump and Juncker will meet later Wednesday to discuss trade. Trump has imposed tariffs on imports of European steel and aluminum and threatened new ones on cars, sparking concerns about the EU-U.S. alliance. Juncker will at Wednesday’s meeting reportedly argue that Europe is Washington’s friend and not trying to take advantage of its American ally.
“Today’s meeting between U.S. President Trump and EU Commission President Juncker could be decisive for broader risk sentiment. European car maker stocks will likely be in the eye of the storm, in light of U.S. threats for tariffs on EU car imports if the talks fail to bear fruit,” said Andreas Georgiou, investment analyst at XM, in a note.
German business sentiment came in slightly better than expected, with the Ifo business climate index for July printing at 101.7, compared with forecasts of a 101.5 reading. The index was at 101.8 in June.
SEB SA SK, +9.22% rallied 9.2% after well-received earnings from the French small-appliances company.
Telefónica Deutschland AG O2D, +6.97% jumped 8.1% after saying its net loss in the second quarter narrowed, and backing its full-year guidance.
Ryanair Holdings PLC RY4C, +0.64% rose 0.6% after the discount airline said it would cut capacity in Dublin by 20% amid pilot strikes in the Irish capital.
Linde AG LIN, +0.84% advanced 1.2% after the chemical giant said profit rose more than 50% in the second quarter.
Indivior PLC INDV, -7.74% slumped 7.7% after the pharmaceutical company posted a 24% drop in second-quarter pretax profit.
STMicroelectronics NV STM, -8.60% lost 8.6%, even after reporting a jump in second-quarter profit.
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