Source: Sharecast
The Stoxx 600 finished 0.3% lower, with marginal gains in London outweighed by mild declines in Frankfurt, Paris, Milan and Madrid.
Nevertheless, Wall Street stocks started Wednesday’s session with solid gains after US and Chinese officials were said to have reached a "framework" trade agreement in London.
Donald Trump said the deal with China was "done, subject to final approval with President Xi and me". He added that "WE ARE GETTING A TOTAL OF 55% TARIFFS, CHINA IS GETTING 10%."
“The talks ended today with no real change to the Geneva agreement, reinforcing the view that the whole tariff drama has been mostly performative,” said Chris Beauchamp, chief market analyst at IG.
“55% tariffs on Chinese goods are not to be sniffed at however, but how much of this will be mitigated by some fancy shipping footwork remains to be seen.”
Helping the buying pressure in New York was the eagerly awaited US consumer price index for May, which showed that inflation increased slightly less than expected, rising by just 0.1% over the month.
In the UK, sentiment was boosted by chancellor Rachel Reeves’ spending review, which was largely well received by markets, with the FTSE 100 finishing within a whisker of its record closing high.
Major announcements included a 3% average increase in the NHS budget over the next three years, increases to spending on defence and transport, and a major investment into social housing.
Market movers
UK housebuilding stocks were performing well, such as Vistry and Bellway, after the spending review revealed £39bn of investment into affordable and social housing – the biggest cash injection in 50 years.
“This comes on top of existing plans to remove red tape around planning permission to make it easier for housebuilders to develop new homes and flats. There is a clear tailwind for the housebuilding sector and the cherry on top would be a further decline in interest rates so more people can afford to get on the housing ladder,” said AJ Bell head of financial analysis Danni Hewson.
Alos in London, healthcare property investment and management firm Assura advanced after it agreed to an increased and final 52.1p-a-share offer from KKR and Stonepeak valuing the company at around £1.7bn.
In Madrid, shares in Zara-owner Inditex came under pressure after second-quarter numbers from the retail giant disappointed. Sales at the Spanish business grew 1.5% in the three months to 30 April to €8.27bn, or by 4.2% once the impact of currency fluctuations were stripped out. Analysts had been expecting sales closer to €8.36bn.