Noor Trends News, Technical Analysis, Educational Tools and Recommendations
European equity indices traded in tight ranges on Tuesday, with investors closely watching ongoing trade talks between China and the U.S. for signs of a thaw in their often strained relationship.
As of 03:05 ET (07:05 GMT), Germany’s DAX index slipped 0.2%, while France’s CAC 40 gained 0.1%, and the U.K.’s FTSE 100 rose 0.4%.
U.S.-China Trade Talks Continue
The trade negotiations between the two largest economies in the world are set to continue into Tuesday, with growing confidence that these discussions could lead to a further de-escalation in the trade conflict. After agreeing in May to temporarily reduce tariffs on both sides, President Trump commented that the talks were progressing well, noting that he was receiving “only good reports” from his team in London.
The focus of the discussions is now on China’s restrictions on rare earth minerals, which threaten to disrupt global supplies, and the U.S. restrictions on chip exports to China. A positive outcome could further ease tensions and boost global trade, providing a lift to market sentiment.
U.K. Unemployment Rate Rises
Recent data highlights the broader impact of the trade war, not just on the U.S. and China, but on other major economies as well. In the U.K., unemployment rose to 4.6% in April, its highest level since July 2021. The increase in the jobless rate comes as the country grapples with the economic fallout from the ongoing trade tensions.
In response to the economic slowdown, the Bank of England cut interest rates by a quarter of a percentage point to 4.25% last month. Policymakers indicated that the tariff increases imposed by the U.S. and other countries would weigh on U.K. economic growth and bring down inflation.
Bellway Raises Full-Year Revenue Forecast
On the corporate front, U.K. housebuilder Bellway raised its full-year revenue expectations following a 7.7% increase in forward orders and steady reservation rates during the spring selling season. The company now expects to complete between 8,600 and 8,700 homes for the financial year ending July 31.
Ryanair also made headlines, announcing plans to purchase 30 new spare LEAP-1B engines from jet engine maker CFM at a list price of $500 million. The budget airline expects this investment to reduce its fuel consumption per flight as it continues to expand its fleet.
Oil Prices Edge Higher Amid Trade Talks
Oil prices saw a slight uptick on Tuesday, as traders awaited the outcome of the U.S.-China trade discussions. Crude prices were buoyed by hopes that easing trade tensions could lead to improved fuel demand, especially if a trade deal is reached. At 03:05 ET, Brent futures gained 0.3%, rising to $67.22 per barrel, while U.S. West Texas Intermediate crude futures also increased by 0.3%, reaching $65.45 per barrel.
The potential for a U.S.-China trade agreement has helped alleviate concerns about weak global demand. With trade expected to flow more freely, a boost in economic activity could drive higher crude demand, adding further support to oil prices.
