Left Menu
Development News Edition

UPDATE 2-Trade talks keep European shares afloat as Sainsbury's, Swedbank sink

Reuters | Updated: 20-02-2019 22:50 IST | Created: 20-02-2019 22:50 IST
UPDATE 2-Trade talks keep European shares afloat as Sainsbury's, Swedbank sink
Trade talks between the world's two biggest economies helped European shares rise on Wednesday, while the threat of a blocked merger sank shares in British supermarket Sainsbury's and a money laundering scandal hit Swedbank.

Germany's trade-sensitive DAX led the way with a 0.8 percent gain and the pan-European STOXX 600 rose 0.7 percent after U.S. President Donald Trump said on Tuesday that trade talks with China were going well. Although autos, which are vulnerable to rising protectionism, jumped 2.4 percent but there were still reasons for investors to remain cautious.

"There's no big material news out there that will give us a sustained uptick to markets," Gary Waite, portfolio manager at Walker Crips Investment Management, said. British supermarket chain Sainsbury's and Swedish lender Swedbank marred the positive picture overall.

Sainsbury's shares sank 18.5 percent after Britain's competition regulator said its merger with Asda should either be blocked or need significant concessions. "Investors are rightly accepting that this deal is dead in the water", commented Neil Wilson from Markets.com.

Britain's retail index fell 2.9 percent with rivals like Morrison losing 5.3 percent. Swedbank shares ended the day 13.6 percent down after Estonia said it was investigating allegations linking Swedbank to suspicious transactions in the country involving Danske Bank.

The top gainers -- Glanbia and Simcorp -- were boosted by strong results. Irish nutrition company Glanbia jumped 12.9 percent after its fourth-quarter results, while Danish software company Simcorp also rose 7 percent after announcing strong results and a share buyback programme.

"Glanbia’s FY results confirm a strong finish to 2018 and were ahead of forecasts at the revenue, EBITA and EPS reporting lines," said Davy Research analysts, adding they upgraded their full-year 2019 EPS forecasts by 5 percent. Fresenius shares jumped 5 percent after it said it expects earnings to grow faster than sales from 2020 after investments dent profit this year.

Air France-KLM took 6.1 percent after it pledged new efficiency gains to offset higher fuel costs this year. Overall, analysts have been overwhelmingly negative on European earnings, downgrading their estimates consistently.

"While the earnings season is OK, if you look at forward looking guidance it doesn't strike me as if there's a reason to be too bullish on markets going beyond the end of this year," said Walker Crips' Waite. (Reporting by Helen ReidEditing by Keith Weir and Alexander Smith, William Maclean)


TRENDING

OPINION / BLOG / INTERVIEW

5G will be the key driving force for COVID-19 recovery: Here's how?

... ...

Canada’s COVID-19 pitfalls highlight need for integrated health information system

In the globalized world of today where outbreaks can spread far and wide within a matter of days, a global-level integrated health information system is ideal but Canadas provincial barriers show that the country lags much behind in deployi...

Pandemic must be impetus, not obstacle, for clean water access

To make matters worse, there are suspicions that the inadequacy of wastewater treatment methods in California, the rest of the USA, and indeed around the world may help to propagate the disease even more widely. ...

3D printing and the future of manufacturing post COVID-19

The on-demand, customizable, and localized manufacturing of product components facilitated by 3D printing has the potential to redefine manufacturing but there are certain technical, mechanical, and legal limitations that, unless ...

Videos

Latest News

Top Democrats say Mnuchin sought coronavirus meeting, showed no movement

The two top Democrats in the U.S. Congress said on Wednesday that the White House sought a new meeting on stalled coronavirus aid talks but showed no sign of moving away from the positions it held when negotiations broke down last week. Whi...

Grizzlies eye play-in berth in finale vs. Bucks

The Memphis Grizzlies will be first on the tee when the Western Conference holds a glorified elimination day Thursday in the NBA bubble near Orlando. The Grizzlies 33-39 will take the court in the early afternoon against the Milwaukee Bucks...

France to bolster Mediterranean military presence over Turkish prospecting

France will increase its military presence in the eastern Mediterranean, President Emmanuel Macron said on Wednesday, calling on Turkey to halt oil and gas exploration in disputed waters that has heightened tensions with Greece. The French ...

Turkish police detain 25 in protest to support women's rights accord

Turkish police on Wednesday detained 25 women protesting against the possibility of President Tayyip Erdogans AK Party pulling Turkey out of an international accord designed to protect women against domestic violence, a police source said. ...

Give Feedback