European stocks pared some of their earlier highs Friday afternoon, although sentiment remained propped up by a strong uptick from the commodities space.
The pan-European Stoxx 600 steadied, trading up 0.2 percent during afternoon deals with almost all sectors in positive territory. Major bourses however were mostly lower.
Europe’s basic resources index was the top sectoral gainer Friday, up almost 2.5 percent, on the back of strong imports data in China. The world’s largest steelmaker, ArcelorMittal, led the gains in the sector, up more than 6.5 percent.
Elsewhere in commodities, oil prices rose almost 1.5 percent each, boosted by the China data. Tullow Oil rose 3.2 percent.
Looking at individual stocks, Provident surged to the top of the European benchmark Friday as the beleaguered British subprime lender announced a recovery plan for its home credit unit. The company is currently struggling with a staff shortage and remains on course to post a loss of up to £120 million ($159 million) in 2017. Its shares were up over 13 percent in afternoon deals.
The world’s third-largest maker of crop chemicals, BASF, announced Friday that it had agreed to buy Bayer‘s seed and herbicide business for 5.9 billion euros ($7 billion). Bayer has been attempting to persuade competition authorities to approve its planned $66 billion acquisition of Monsanto. Bayer’s shares were around 1 percent higher Friday.
Meanwhile, GKN tumbled to the bottom of the index after the British engineering firm said “disappointing” trading in aerospace in the third quarter and two external claims would result in weaker-than-anticipated full-year profits in 2017. Its shares slipped 10 percent on the news.
U.K. investors will be monitoring the ongoing stalemate between British officials and their European counterparts after the fifth round of Brexit talks finished this week. Speaking on Thursday, the European Union‘s chief negotiator Michel Barnier said there is a “disturbing deadlock” over the amount the Britain should pay before it leaves the bloc.
The lack of progress means that discussion over a future trade agreement has been postponed, likely until the European Council meets in December. On Friday, the British pound bounced back in trade, while the FTSE 100 came under pressure.
In Washington D.C., a convening of G-20 finance ministers and central bank governors continues, with European Central Bank (ECB) board members Vitor Constancio and Sabine Lautenschlaeger set to speak. In an address in the U.S. capital Thursday, ECB President Mario Draghi defended the institution’s policy of keeping interest rates low.
Sticking with the U.S., stocks traded higher in early trade on Wall Street as investors digested the latest set of corporate earnings.