European Markets Close Higher On Trade Deal Optimism

(RTTNews) - European markets ended higher on Monday amid hopes the U.S. and China will sign a phase one trade deal by the end of this year.

There is renewed optimism about a U.S.-China trade agreement after a tabloid run by China's ruling Communist Party discounted "negative" media reports and said the economic superpowers are "very close" to a phase one deal.

The state-backed Global Times said on Twitter that China also remains committed to continuing talks for a phase two or even a phase three deal with the United States.

U.S. national security adviser Robert O'Brien said an initial trade deal was still possible by the end of the year.

U.S. President Donald Trump and Chinese President Xi Jinping have also recently made positive comments about a potential trade deal despite reports of complications arising that could delay the agreement until next year.

Investors were also tracking political news from the U.K., earnings and other corporate news for direction.

The pan European Stoxx 600 ended up 1.02%. The U.K.'s FTSE 100 ended stronger by 0.95%, Germany's DAX gained 0.63 and France's CAC 40 ended up 0.54%, while Switzerland's SMI closed 0.96% up.

Among other markets in Europe, Austria, Belgium, Czech Republic, Denmark, Greece, Ireland, Italy, Netherlands, Norway, Poland, Russia, Spain and Sweden ended on a firm note.

Iceland and Turkey declined, while Portugal and Ukraine ended flat.

In the U.K. market, NMC Health gained about 6.5%. Marks & Spencer, Kingfisher, Ashtead Group, Spirx-Sarco Engines, Direct Line Insurance, InterContinental, Burberry Group, Johnson Matthey, Hargreaves Lansdown, Coca Cola, Prudential, Severn Trent, RBS and Buncy gained 2 to 5%.

In France, ArcelorMittal gained nearly 3%. Atos and STMicroElerctronics gained about 2.3% and 1.7%, respectively.

Louis Vuitton shares gained about 2% after the company reached a deal to acquire jeweler Tiffany & Co. (TIF) for $135 per share in cash.

Auto stocks Renault and Peugeot and bank stocks Credit Agricole, BNP Paribas and Societe Generale closed weak.

In Germany, Infineon rallied 2.6%. RWE, Continental, MTU Aero, Bayer, Wirecard and Fresenius gained 1.5 to 1.8%.

Shares of Thyssenkrupp declined sharply following a rating downgraded of the stock by BNP Paribas.

In economic news, German business confidence rose to a four-month high in November, suggesting that the economy is set to continue to expand moderately in the fourth quarter.

The business confidence index rose to 95.0 in November from 94.7 in October, survey data from ifo institute showed Monday. The reading was in line with expectations.

The institute said the German economy is showing resilience. The largest euro area economy is likely to grow 0.2% in the fourth quarter, the think tank said.

Companies' assessment of the current situation was slightly better, the survey showed. The current situation index gained marginally to 97.9 from 97.8 a month ago, but below the forecast of 98.0.

At the same time, companies' expectations were less pessimistic than in October. The corresponding index climbed to 92.1 from 91.6 in the previous month.

UK retailers expect sales volume to grow in December as festive season begins, the Distributive Trades survey from the Confederation of British Industry showed Monday.

The retail sales balance rose to -3% in November, the highest in seven months and above the expected level of -11%.