European stock markets closed slightly higher yesterday as a steady showing in Asia gave way to a slow day on Wall Street.
London’s benchmark FTSE 100 index edged higher, while indices in Frankfurt and Paris had edged a bit further into positive territory.
German investors were cheered by a rebound in industrial orders in September, while the French services sector posted growth in October on the back of stronger foreign demand.
London’s FTSE 100 rose 0.1% to close at 7,396.65 points; Frankfurt’s DAX 30 was up 0.2% at 13,179.89, while
Paris’ CAC 40 was up 0.3% at 5,866.74.
In New York, the Dow was 0.2% lower in midday trading, after the US Bureau of Labor Statistics said third-quarter productivity had fallen by 0.3%, the biggest drop since 2015, while unit labour costs increased by 3.6%.
“Markets are back in consolidation mode on Wednesday,” noted Craig Erlam, senior market analyst at Oanda trading group.
Analysts at the Charles Schwab brokerage said that “US stocks are taking a breather following a recent rally back to all-time highs, with the upward momentum being stalled by the first drop in nonfarm labour productivity in nearly four years.”
Meanwhile, “we are still seeing plenty of trade war headlines with China, it seems, looking to capitalise on (US President Donald) Trump’s desire to secure a phase-one agreement,” Erlam noted.
Signs of trade talk progress also helped support the Chinese yuan, which was hovering slightly above seven to the dollar, having broken below that level on Tuesday for the first time since May.
Chief market analyst Neil Wilson at Markets.com was among those who suspected the effects of a possible trade talk advance might have run their course.
“One can’t help but feel the market is already pricing in all the good news, and ignoring the bad,” Wilson said.
“A deal seems to hinge on the US removing the tariffs it’s placed on China — for all the optimism, this would be a stretch,” he commented.
Elsewhere, oil prices — which reached six-week highs on Tuesday on trade and economic hopes — bobbed up and down throughout the day, and were lower in late European trading.
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