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European stocks edge higher, Brexit fears briefly ease; DAX up 0.40%

Published 07/08/2016, 03:35 AM
© Reuters. Frankfurt Stock Exchange
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Investing.com - European stocks were steady to higher on Friday, as markets paused ahead of a key U.S. employment report due later in the day and as concerns over the global effects of the Brexit vote seemed to briefly subside.

During European morning trade, the EURO STOXX 50 eased up 0.09%, France’s CAC 40 added 0.10%, while Germany’s DAX 30 gained 0.40%.

Market participants were eyeing the U.S. nonfarm payrolls report due later Friday, for further confirmation of the strength of the job market after upbeat data was released on Thursday.

But investors were still cautious as Britain’s shock decision to leave the European Union continued to fuel uncertainty over the consequences of the U.K. vote on the country’s economy and the global economy as a whole.

In the minutes of the European Central Bank’s last policy meeting released on Thursdaym policymakers said the Brexit vote could have significant negative repercussions for euro zone growth.

The ECB also said it remained ready to boost its stimulus program again if inflation remained below the near-2% target.

Financial stocks were mixed, as BNP Paribas (PA:BNPP) slid 0.32% and Societe Generale (PA:SOGN) rose 0.28% in France, while Germany’s Commerzbank (DE:CBKG) and Deutsche Bank (DE:DBKGn) gained 0.46% and 1.20%.

Among peripheral lenders, Italy’s Intesa Sanpaolo (MI:ISP) and Unicredit (MI:CRDI) rallied 1.44% and 1.88% respectively, while Spanish banks Banco Santander (MC:SAN) and BBVA (MC:BBVA) slipped 0.15% and 0.12%.

Elsewhere, Volkswagen (DE:VOWG_p) saw shares climb 1.11% despite news the German carmaker will have to pay an additional $86 million in penalties to California over its emissions scandal. The company had already reached settlement of $14.7 billion with U.S. officials last week.

In London, commodity-heavy FTSE 100 rose 0.20%, boosted by sharp gains in the mining sector.

Shares in Antofagasta (LON:ANTO) jumped 1.03% and Glencore (LON:GLEN) rallied 1.22%, while Anglo American (LON:AAL) and Rio Tinto (LON:RIO) surged 1.93% and 2.24% respectively.

Financial stocks added to gains, as Barclays (LON:BARC) edged up 0.19% and HSBC Holdings (LON:HSBA) rose 0.38%, while Lloyds Banking (LON:LLOY) advanced 0.63%. The Royal Bank of Scotland (LON:RBS) underperformed however, with shares tumbling 0.98%.

Sports Direct (LON:SPD) was one of the worst performers on the index, with shares plummeting 3.26% after the company posted on Thursday a 0.5% decline in core earnings to £381.4 million for the year to April 24, which was at the bottom end of guidance given in January.

In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.12% gain, S&P 500 futures a 0.12% rise, while the Nasdaq 100 futures indicated a 0.15% increase.

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