Trade progress, Powell boost European stocks Tesla Germany share falls

Trade progress, Powell boost European stocks Tesla Germany share falls

LONDON (Reuters) – European shares climbed on Monday after a market-friendly speech by U.S. Fed Chairman Powell and signs of progress on a U.S.-Mexico NAFTA trade deal, which boosted car stocks.

A notable laggard was the Germany-listed stock of U.S. electric carmaker Tesla, which fell more than 3 percent in early deals on the Tradegate exchange, after Chief Executive Elon Musk called off his bid to take the company private.

The pan-European STOXX 600 rose 0.2 percent by 0725 GMT, with Germany’s DAX up 0.4 percent, following stronger Asian trading after Powell kept to the Fed’s forecast for gradual interest rate hikes.

British markets were closed for a public holiday.

Traditional auto stocks were the best performers, up 0.7 percent after President Donald Trump said on Saturday that a trade deal with Mexico was near.

Jesus Seade, who will serve as chief negotiator for Mexico’s next government, said the issue of auto sector rules is basically resolved in discussions with U.S. Trade Representative Robert Lighthizer.

BMW, Volkswagen (VOWG_p.DE), and Daimler rose 1 to 1.4 percent. The German carmakers rely on smooth trade between Mexico and the U.S. to sell vehicles made in Mexican manufacturing plants into the U.S. market.

Metro shares surged 17 percent after Ceconomy announced it may join family-owned Haniel in selling a stake in the German retailer to an investor group led by Czech billionaire Daniel Kretinsky.

Lundin Petroleum shares climbed 4.1 percent after Norway’s Equinor increased its resource estimate for the Johan Sverdrup oilfield, in which Lundin has a 22.6 percent stake.

Equinor, which has a 40 percent stake in the field, gained 0.9 percent.

Another strong boost to the STOXX came from Swiss drugmaker Novartis, its shares up 0.5 percent after it received European approval for Kymriah, its gene-modifying therapy for blood cancer.

Reporting by Helen Reid; editing by John Stonestreet

News Source ReutersNews

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