European stocks advanced Monday, extending a two-week rally, helped by what appeared to be a pause in the ongoing trade skirmish between the U.S. and China, the world’s two biggest economies.
How markets are moving
The Stoxx Europe 600 SXXP, +0.50% added 0.5% to 376.58, building on last week’s gain, which was the equity gauge’s second weekly rise in a row.
The pan-European benchmark is on track for its highest close since March 16, more than two weeks ago.
Germany’s DAX 30 DAX, +0.88% rose 0.8% to 12,332.73, while France’s CAC 40 PX1, +0.46% tacked on 0.4% to 5,280.69. The U.K.’s FTSE 100 index UKX, +0.18% edged up 0.2% to 7,195.30.
The euro EURUSD, -0.0244% traded at $1.2296, up modestly from $1.2283 late Friday in New York.
What’s driving markets
Worries about a global trade war have persisted for weeks. While the Trump administration exempted most countries from recent U.S. tariffs on imports of steel and aluminum, its targeting of Chinese goods has fanned fears.
Yet concerns appeared to be ebbing on Monday, as U.S. officials on Sunday softened some of the rhetoric, noting that any penalties on Beijing aren’t imminent and there is ample time to work out a deal and step back from a possible trade war.
President Donald Trump himself struck a hopeful note in a tweet Sunday, as he suggested China and the U.S. can reach an accord, absent a trade war.
Meanwhile, some Chinese officials on Monday talked tough, saying frictions were the fault of the U.S., and negotiations were not possible under current conditions, according to media reports.
Read: Here’s how a ‘trade skirmish’ could become a global ‘trade war’
And see: U.S. soybeans would be China’s biggest weapon in a trade war
What strategists are saying
Trump’s tweet “suggested the war of words and threats of tariffs to date have just been part of the negotiating process,” said Sue Trinh, head of Asian foreign-exchange strategy for RBC, in a note.
“Attention now turns to China’s response, if any,” she added, noting that Chinese President Xi Jinping is due to deliver a speech Tuesday.
Read: Here’s how a ‘trade skirmish’ could become a global ‘trade war’
Stock movers
Shares in Deutsche Bank AG DBK, +3.42% DB, -3.14% rose 2.6% following news the German lender has replaced its British chief executive, John Cryan, with the senior German head of its retail bank, Christian Sewing.
The switch signals a less ambitious future after years of grim financial results and sputtering attempts to regain a spot among global investment-banking powerhouses.
Novartis AG’s stock NOVN, +0.59% added 0.6% after the Swiss pharmaceutical company said it plans to buy U.S.-based gene-therapy company AveXis Inc. AVXS, -3.09% for $8.7 billion.
Rolls-Royce Holdings PLC RR., +1.54% shares rose 1.5% after the company agreed to sell its German fuel-injection systems supplier L’Orange to Woodward Inc. WWD, -2.24% for an enterprise value of 700 million euros ($859.5 million).
Economic data
A reading on eurozone investor confidence in April is due at 9:30 a.m. London time, or 4:30 a.m. Eastern Time.