European shares flat as Sino-U.S. trade deal in focus- tech gains

Published 13/01/2020 in Business News, Economy & Finance

European shares flat as Sino-U.S. trade deal in focus- tech gains

(Reuters) – European shares were little changed on Monday as investors shifted their focus to the signing of an interim Sino-U.S. trade deal later this week, while technology stocks rose on a clutch of brokerage upgrades and price-target bumps.

The benchmark European STOXX 600 index was unchanged by 0923 GMT.

The Phase 1 trade deal between the United States and China, due to be signed at the White House on Wednesday, marks the first step toward ending a bruising 18-month trade war between the world’s two largest economies.

Technology stocks .SX8P led gains in the region, rising about 0.4%. German software services provider SAP SE (SAPG.DE), the biggest stock on the index by market capitalization, rose about 0.2% after Citigroup raised its price target.

“It’s part of an ongoing momentum since late last year. You’ve got investors looking to buy themes by growth and technology is seen as a key growth sector,” said Neil Campling, analyst at private bank Mirabaud in London.

He added that technology would see increased buying in the early part of the year, with some help from factors such as waning trade and geopolitical tensions.

British security software maker Avast PLC (AVST.L) was among the top gainers on the index, adding some 2.4% after a JP Morgan upgrade. Swedish telecommunication technology maker Ericsson (ERICb.ST) also rose after a Citigroup upgrade.

Technology conglomerate Siemens AG (SIEGn.DE) rose 0.3% after Goldman Sachs resumed coverage of the stock with a “buy” rating.

Automobile stocks came under pressure after China lowered its annual sales forecast. French manufacturer Renault SA (RENA.PA) led declines on the index.

Renault was also the biggest loser on the STOXX 600, shedding 3.7%.

Carmakers have grappled with weakening global demand for several years now, with slowing demand in the world’s second- largest economy serving to only exacerbate the situation.

The country’s top auto body reiterated predictions that sales will likely shrink for the third consecutive year in 2020.

Print article

Leave a Reply

Please complete required fields