LONDON (Reuters) - Europe’s trade-sensitive autos and mining shares climbed on Thursday on news of fresh U.S.-China trade talks, though the broader market lost momentum after central bank decisions and new U.S. sanctions on Russian and Chinese tech firms.
The pan-European STOXX 600 ended the day down 0.15 percent, while Germany’s DAX and the index of biggest euro zone stocks held on to gains of 0.2 percent.
Autos shares rose 1.1 percent after U.S. officials invited China to new trade talks, which the Chinese foreign ministry welcomed.
Carmakers’ shares have been among the biggest victims of trade tensions between the United States and its trading partners.
“You have to be concerned about the impact [of trade tensions on autos] because the evidence is that companies are seeing pressures as a consequence,” said Steven Magill, head of European Value at UBS Asset Management.
“But the share prices appear to be discounting a negative scenario already,” added Magill, who holds Peugeot in his European portfolio.
Tech also rose as chipmakers and Apple suppliers ams, Infineon, BE Semiconductor, and STMicro climbed 1.5 to 5 percent after Apple launched bigger and pricier iPhones.
Tech stocks gave back some gains, however, after Washington imposed new sanctions on a China-based tech firm, its North Korean CEO and a Russian subsidiary, accusing them of moving illicit funding to North Korea in violation of U.S. sanctions.
Dealmaking and results led to some strong stock moves, particularly in the banking sector.
French bank Natixis gained 3.1 percent after it decided to sell several specialized finance businesses to its parent, BPCE, and use part of the 2.7 billion euros ($3.1 billion) in proceeds for acquisitions.
“No major acquisition expected, nothing imminent at the moment, but things could always develop by the time of the special dividend,” wrote KBW analyst Jean Pierre Lambert.
Commerzbank rose 2.5 percent after UBS analysts upgraded the stock to a “buy”.
News that Deutsche Bank is considering an overhaul to loosen the bond between its retail and investment banks, making it easier to merge some or all of the group with rival lenders, helped lift its shares up 2 percent.
Recent reports have suggested mergers between the two German lenders, as well as possible deals involving Italian and French banks, but banks remain the worst-performing sector in Europe year-to-date.
“Despite all the recent rumors around UniCredit and other European banks, cross-border banking M&A will be limited, if any, in the foreseeable future,” said Jauke de Jong, equity analyst at AFS Group in Amsterdam.
Banks nevertheless were the second-best performers, up 0.7 percent, after the Turkish central bank’s decision to sharply raise rates boosted the lira, causing a rally in Turkey-exposed banks BBVA, Unicredit, ING, and BNP Paribas.
Oil storage and distribution firm Rubis fell 10.6 percent after issues with its Iran and Turkey operations bruised first-half profit.
U.S. sanctions against Iran forced Rubis to find a buyer for a recent acquisition in Iran, leading to a 15 million euro writeoff, while the firm’s oil storage facility in Ceyhan, Turkey, also underperformed due to political tensions there, Berenberg analysts said.
German meal delivery firm Delivery Hero also fell 3.2 percent after its first-half results.
French tyre maker Michelin rose 3.6 percent after it confirmed its 2018 financial outlook, saying signs of growth in Europe and North America would offset a slowdown in China.
Adyen shares fell 12 percent after the company placed 2.46 billion shares.
Both the Bank of England and the ECB kept rates on hold, in line with market expectations.
Graphic: Lower euro zone banks earnings estimates - reut.rs/2D3nukP
Reporting by Helen Reid; Editing by Larry King and Gareth Jones