European Markets Clung To Small Gains After Early Strength Recedes

( - The European markets got off to a positive start Friday, but pared their early gains over the course of the morning. The markets settled into a sideways patter in the afternoon and ended the session with small increases. Traders have been keeping a close eye on the UK as they host a visit from U.S. President Trump

The British pound weakened Friday, after Trump remarked that Prime Minister Theresa May's current 'soft-Brexit' proposal with the EU would probably "kill" any future trade deals with the United States.

In an interview with The Sun, Trump said that PM's "soft Brexit" strategy would "affect trade with the United States, unfortunately in a negative way."

"If they do a deal like that, we would be dealing with the European Union instead of dealing with the U.K., so it will probably kill the deal," Trump told the paper.

The pan-European Stoxx Europe 600 index advanced 0.17 percent. The Euro Stoxx 50 index of eurozone bluechip stocks increased 0.26 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.21 percent.

The DAX of Germany climbed 0.38 percent and the CAC of France rose 0.43 percent. The FTSE 100 of the U.K. gained 0.14 percent and the SMI of Switzerland finished higher by 0.49 percent.

In London, Ryanair Holdings rose 0.38 percent after it received EU approval to buy a 75 percent interest in Austrian airline, Laudamotion, in which it already owns 24.9 percent.

Ashmore Group rallied 0.86 percent. The specialist Emerging Markets asset manager reported a drop in assets under management despite net inflows in its fourth quarter.

Recruitment firm Hays jumped 8.58 percent after its Group net fees for the fourth quarter increased 14 percent on a headline basis and 15 percent on a like-for-like basis against the prior year.

China's exports increased more-than-expected in June and its trade surplus with the U.S. reached a record high in the midst of escalating trade disputes between the two countries.

Data from the General Administration of Customs showed that exports increased 11.3 percent year-on-year in June, bigger than the expected 9.5 percent, but slower than the 12.6 percent rise seen in May.

At the same time, annual growth in imports slowed to 14.1 percent. Economists had forecast a sharp growth of 21.3 percent after May's 26 percent increase.

Consequently, the overall trade surplus surged to $41.61 billion in June from about $24.9 billion in May. The surplus with the U.S. came in at record $28.97 billion, Reuters and Bloomberg reported, citing their own calculations.

Germany's wholesale price inflation accelerated further in June to the highest level in nine months, data from Destatis showed Friday. Wholesale prices climbed 3.4 percent year-on-year in June, faster than the 2.9 percent increase seen in May.

A report released by the Labor Department on Friday showed an unexpected decrease in U.S. import prices in the month of June, although the report also showed a slightly bigger than expected increase in export prices during the month.

The Labor Department said import prices fell by 0.4 percent in June after climbing by an upwardly revised 0.9 percent in May.

The pullback surprised economists, who had expected import prices to inch up by 0.1 percent compared to the 0.6 percent increase originally reported for the previous month.

Meanwhile, the Labor Department also said export prices rose by 0.3 percent in June following a 0.6 percent increase in May. Economists had expected export prices to edge up by 0.2 percent.

Reflecting concerns about the potential impact of tariffs, the University of Michigan released a report on Friday showing an unexpected deterioration in U.S. consumer sentiment in the month of July.

The preliminary report said the consumer sentiment index dipped to 97.1 in July from the final June reading of 98.2. Economists had expected the index to come in unchanged.

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