The broad-based major European indices surged higher in Friday trading on reports of a breakthrough to end the trade war between the US and China. A report in The Wall Street Journal said that US Treasury Secretary Steven Mnuchin was considering lifting some or all tariffs on Chinese goods, while CNBC reported that China offered US trade negotiators a six-year increase in imports.
In economic news, the house price index rose 4.3% in both the euro area and the EU in Q3 of 2018 compared with the same quarter of the previous year, according to Eurostat, the statistical office of the European Union. Compared with Q2 of 2018, house prices rose 1.6% in the euro area and 1.5% in the EU.
The highest annual increases in house prices in Q3 of 2018 were in Slovenia (+15.1%), the Netherlands (+10.2%) and Ireland (+9.1%), while prices fell in Sweden (-2.1%) and Italy (-0.8%). Compared with the previous quarter, the highest increases were reported in the Netherlands (+3.3%), Malta (+3.1%) and Croatia (+2.8%), while decreases were seen in Italy (-0.8%), Romania (-0.7%), Finland (-0.4%), Slovakia (-0.3%) and Hungary (-0.2%).
In the UK, UK retail sales fell by more than expected in December after consumers moved up their Christmas shopping to November, according to the Office for National Statistics (ONS). Sales volumes fell 0.9%, more than the 0.8% economists had forecast.
"Following the increased growth in November, where shoppers snapped up more Black Friday offers as they continue to bring forward their Christmas shopping, retail sales weakened in December," said Rhian Murphy, head of retail sales at the ONS, according to the BBC.
In Germany, turnover in the German accommodation and food service activities in November 2018 increased 2.5% in real terms and 5.0% in nominal terms compared with the same month of the previous year, according to the Federal Statistical Office (Destatis).
Compared with the same period the previous year, turnover in the German accommodation and food service activities increased 1.2% in real terms, and 3.4% in nominal terms in the first 11 months of 2018.
And in Italy, construction output grew in the month-on-month series following a contraction in October, rising 0.2% in November, according to the Italian National Institute of Statistics (Istat). Production in construction continued its recent decline in the three-month on three-month series, falling by 0.7% in the three months to November 2018. Compared with November 2017, construction output also fell year-on-year, contracting by 0.1%. When comparing the first 11 months of 2018 with the same months a year earlier, the unadjusted index of production in construction was up 1.6%, while the calendar adjusted index rose 1.0%.
In equities, industrial equipment rental company Ashtead Group, and turnaround firm Melrose Industries led the FTSE higher in London, rising 4.5% and 4.4% respectively, followed by online gambling company GVC Holdings, and supermarket operator Wm Morrison Supermarkets, each of which closed 4% higher. Mining company Antofagasta, and insurance firm Prudential climbed 3.8% and 3.7%, while Royal Bank of Scotland Group, home builder Barratt Developments and Rolls Royce Holdings each closed 3.6% higher.
In Frankfurt, automotive stocks helped the DAX surge higher, led by tire maker Continental, which climbed 4.5%, while automakers Daimler, BMW, and Volkswagen rose 4%, 2.9%, and 1.9% higher. Internet company Wirecard led all gainers, moving 4.8% higher, while chemicals company BASF, adhesives manufacturer Covestro, and pharmaceutical firm Bayer were up 4.1%, 4%, and 3.7%.
And in Paris, IT company ATOS led the CAC into positive territory, climbing 4.9%, followed by semiconductor company STMicroelectronics, which rose 4.4%. Oilfield services company TechnipFMC gained 4%, while Tire maker Michelin was up 3.6% and supermarket operator Carrefour rose 3.7%. Steel and mining company ArcelorMittal was up 3.5%, while hotel operator Accor increased 3.3%, and luxury goods company Kering, and auto parts supplier Valeo each closed 3.1% higher.
The FTSE rose 1.95%, the DAX climbed 2.63%, and the CAC-40 gained 1.70%.
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