Intel stock extends gains after report of possible U.S. government stake
Investing.com - European equity indices edged slightly lower Monday, with investors cautious ahead of expected talks between China and the U.S. in London, with investors hoping for an end to their protracted rift over trade.
At 03:15 ET (07:15 GMT), the DAX index in Germany dropped 0.4%, the CAC 40 in France slipped 0.1% and the FTSE 100 in the U.K. fell 0.1%.
U.S./China trade talks
Representatives of the two latest economies in the world are expected to get together in the U.K. capital later in the session, with this meeting coming less than a week after President Xi Jinping and U.S. President Donald Trump held a rare, direct call.
Trump announced Friday that Treasury Secretary Scott Bessent will lead the U.S. delegation, while China’s foreign ministry earlier Monday confirmed their participation in the high-level trade talks.
Investors are hoping that the talks will yield a more lasting deescalation in the U.S.-China trade conflict, after both sides agreed to slash their respective trade tariffs in mid-May, albeit temporarily.
There have already been signs of a lessening of tensions, as Boeing (NYSE:BA) has resumed deliveries to Chinese customers after halting deliveries of new planes in April as the world’s two largest economies ramped up tariffs on each other.
Chinese trade data disappoints
The economic data slate is practically empty in Europe Monday, but Chinese trade data illustrated the headwinds facing the country, as growth in exports missed expectations, with Chinese exports to the U.S. plunging over 34% from a year ago, while imports shrank substantially more than expected.
Additionally, Chinese consumer inflation shrank for a fourth straight month, albeit slightly less than expected, while producer inflation fell more than expected.
Back in Europe, there is regional inflation data to digest at the end of the week, after the European Central Bank hinted it was nearing the end of its policy easing cycle after cutting interest rates last week, suggesting that another cut in July was unlikely.
Tesla remains in spotlight
In the corporate sector, the European earnings season has largely come to an end, and the spotlight is likely to remain on Tesla (NASDAQ:TSLA) given the public feud between CEO Elon Musk and President Trump.
Morgan Stanley (NYSE:MS) has retained its “overweight” on the electric vehicle manufacturer, seeing an upside of nearly 39% from the stock’s close on Friday.
Tesla had plummeted nearly 15% last week as both Musk and Trump engaged in personal attacks against each other on social media.
However, “while emotions are running high, we are not convinced the longer-term vectors that drive the stock’s value have changed,” Morgan Stanley said, in a note.
Crude slips lower
Oil prices slipped lower Monday, but have retained most of last week’s gains as traders watched for news from the U.S.-China trade talks in London.
At 03:15 ET, Brent futures slipped 0.5% to $66.14 a barrel, and U.S. West Texas Intermediate crude futures fell 0.4% to $64.30 a barrel.
The prospect of a U.S.-China trade deal have boosted some investors’ risk appetite and supported oil prices amid hopes a deal will boost economic growth and thus demand for energy.
Brent had advanced 4%, and WTI gained over 6%, last week, their first weekly gain in three weeks.