European markets have a mixed start to the day

European bourses are having a mixed start to the day with the FTSE and the DAX a touch lower but French markets slightly stronger as they chew over the European Central Bank’s decision Thursday to keep interest rates steady until the middle of next year.

Trump approves China tariffs

The US took its trade argument with China to another level last night when President Trump approved tariffs on about $50 billion worth of Chinese goods. According to a report by the Wall Street Journal the approval followed a 90-minute meeting of senior White House and national-security officials and senior representatives of the Treasury and the Commerce Department. The US is expected to publish the list of affected goods later Friday which are likely to be very similar to the ones published in early April.

Asian investors are already bracing themselves for the fallout which could potentially spread from metals producers onto other industries such as car makers. The Shanghai Composite Index fell to its lowest level in 20 months.

Tesco grows sales

If Tesco is anything to go by the UK high street is recovering from a slump in sales earlier this year. The supermarket chain, which accounts for almost 28% of the UK’s supermarket trade, said its like-for-like sales increased 2.1% in the 13 weeks to 26 May. The company’s sales have been rising for 10 consecutive quarters partially helped by the purchase of food wholesaler Booker last year which owns the Premier, Budgens and Londis store brands .

Euro in a large selloff after ECB comments

The euro was headed for its worst weekly loss in nearly two years after the ECB surprised the market by indicating that it would keep interest rates at record lows into at least mid-2019, even as it pledged to end its massive bond purchase scheme by the end of this year. The common currency slipped to $1.1589 further pressured by a bounce in the US economy indicated by strong retail sales data and optimistic comments from the Fed.

The pound is also beginning to weaken against the greenback, down 0.09% ahead of the Bank of England policy meeting Thursday next week.

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