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European stocks retreated slightly on Wednesday morning, marking a pause after a strong session in the United States which saw the S&P 500 hit a new high.
The pan-European Stoxx 600 index fell 0.2%, with basic resources losing 0.8% on lead losses while food and beverages edged up 0.3%.
Market participants in Europe have broken with positive sentiment on Wall Street, where the S&P 500 and Nasdaq Composite set records. The S&P 500 hit a record high on Tuesday, wiping out all of its losses due to the market sell-off caused by the coronavirus pandemic. It confirms the start of a new bull market.
The larger stock index climbed 0.2% to 3,389.78, a record close. The Nasdaq Composite also hit a record high, climbing 0.7% to 11,210.84.
Meanwhile, investors continue to monitor developments in the US-China trade war.
President Donald Trump said on Tuesday that he had postponed trade talks with China and did not wish to speak with China at this time. White House Chief of Staff Mark Meadows later told reporters there were no new high-level talks planned between Washington and Beijing.
The world’s two largest economies agreed to a first “phase one” trade pact in January, but geopolitical tensions have increased and there are doubts whether China can honor its commitments under the the agreement.
In Europe, UK inflation unexpectedly surged to a four-month high in July at 1.0%, beating expectations of 0.6%, which would have been unchanged from June.
On the earnings front, Maersk, the world’s largest shipping company, beat second-quarter profit guidance on Wednesday and said it expected demand to pick up in the third quarter, but warned against a “significant drop” during the year. Maersk shares rebounded 5.6% at the start of trading.
Royal Unibrew was the biggest winner on the Stoxx 600, its shares rising 11% after the Danish brewer raised its outlook after a strong performance in June.
At the other end of the blue-chip European index, German utility RWE fell 4.2% after a stock issue.
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