European stocks trade higher despite concerns for US-China trade talks

  • European markets opened in positive territory on Tuesday despite uncertainty and pessimism over the outcome of trade talks between the U.S. and China.
  • Beijing is pessimistic about the trade deal, one government source told CNBC's Eunice Yoon on Monday. China is concerned after President Donald Trump said there would be no tariff rollback.

European markets traded in positive territory on Tuesday despite uncertainty and pessimism over the outcome of trade talks between the U.S. and China.

The pan-European Stoxx 600 climbed 0.4% in early deals, with basic resources and travel and leisure stocks each rising 0.9% to lead gains as the majority of sectors and major bourses advanced.

The status of trade talks between economic superpowers China and the U.S. remains in focus for global investors. Stocks in Asia were mixed in Tuesday afternoon trade amid concerns over the state of negotiations.

Beijing is pessimistic about the trade deal, one government source told CNBC's Eunice Yoon on Monday. China is concerned after President Donald Trump said there would be no tariff rollback, which Beijing had thought both parties had agreed in principle, Yoon reported.

There were hopes over the weekend that talks, aimed at sealing a "phase one" of a trade agreement, could be progressing with a report by Chinese state media stating that "constructive" trade talks had taken place between Washington and Beijing.

Unrest in Hong Kong is also being closely watched by investors. A Hong Kong University campus stand-off between anti-government protesters and police has now entered its third day. The city's leader Carrie Lam has urged a peaceful solution.

Meanwhile, China's top legislature said Hong Kong courts have no power to rule on a proposed ban on face masks, Reuters reported, citing state news agency Xinhua.

In European news, focus in the U.K. remains on political campaigning. Britain's opposition Labour party will on Tuesday take aim at "obscene" billionaires, pledging a radical redistribution of wealth, Reuters reported.

Stocks on the move

Satellite operator SES plunged more than 21% in early trade after the chairman of the U.S. Federal Communications Commission backed a public auction to free up spectrum for the C-band for 5G, according to Reuters.

British technology company Halma saw its shares rise 7.6% after reporting interim results, while Homeserve also gained 6.3% after posting a rise in first-half profits.

Easyjet stock rose 2.2% after the budget carrier reported annual results at the upper end of its guidance.

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