European stock markets are in the red as the US-China trade tensions and fresh Chinese data erode investors’ confidence. In Frankfurt German car makers bore the brunt of slowing demand from China where sales of personal cars have declined by 17% on the year. This was not major news for the car manufacturers, as they have been feeling the pinch for months, but it was a confirmation of how negative the situation was.
The DAX declined nearly 1% while the FTSE held better with a decline of only 0.2%. In London Centrica was among the lead gainers showing a surprise revenue increase of 50% in the first quarter, pulling up fellow utility National Grid on its coat tails.
An overnight increase in oil prices proved supportive of oil majors but had a negative effect on travel companies.
Oil recovers after weekend decline
China trade tensions are casting a dark cloud over the oil market with the prospect of Chinese imports declining and lower demand from this key market. Although prices nudged higher in early London trade this could prove only a brief respite in a market that looks as if it is about to turn.
Sterling trading is somewhat lifeless, reflecting the lack of progress on the political front marked by an unclear outcome of the UK cross party talks on Brexit. The GBP could be treading water for the better part of the week ahead of European elections on 23 May which are seen as an indirect vote on Brexit.
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