EUROPE MARKETS: European Markets Notch Hard-fought Gains Amid China's Economic Pledge

By Emily Horton

Investors were keeping one eye on Brexit vote; Italian equity market lags behind peers

European markets finished higher Tuesday, in an up-and-down session, as Chinese government officials outlined plans to boost the country's sluggish economy.

In the U.K., politicians were preparing to vote on Prime Minister Theresa May's contentious agreement for leaving the European Union in March.

How are the markets trading?

The Stoxx Europe 600 gained 0.4% to close at 348.71, after finishing down 0.5% on Monday.

France's CAC 40 closed 0.5% higher at 4,786.17, the U.K.'s FTSE 100 rose 0.6% to end at 6,895.02 and Germany's DAX (DAX) added 0.3% to 10,891.79.

Italy's FTSE MIB lagged behind regional peers, finishing little changed, down less than 0.1% to 19,165.48.

The euro dropped to $1.1388, compared with $1.1472 late Monday, and the British pound last bought $1.2732, down sharply from $1.2866, in the previous session.

What is driving the markets?

A landmark vote over May's divisive agreement for Brexit was scheduled to take place at 10:30 p.m. local time in the U.K. on Tuesday (around 5:30 p.m. Eastern). Most expect it to be rejected soundly in the worst defeat for any U.K. prime minister in history (http://www.marketwatch.com/story/brexit-brief-uk-prime-minister-faces-historic-defeat-in-landmark-vote-2019-01-15), with more than 100 Conservative politicians currently opposed to its terms.

In China, government officials have stepped up efforts (http://www.marketwatch.com/story/china-to-ramp-up-efforts-to-support-economy-2019-01-15) to spur economic growth amid signs the country's economic slowdown is deepening. Beijing intends to improve credit availability for smaller companies, accelerate infrastructure investment and cut taxes (http://www.marketwatch.com/story/china-to-slash-taxes-keep-currency-stable-to-offset-slowdown-2019-01-14).

In the event that the deal is voted down, May will have three days to come up with an alternative for exiting the European Union on March 29. However, EU leaders have insisted that the deal already agreed is the only one on offer.

Read:May in last-ditch push for Brexit deal votes -- what the City of London is saying (https://www.fnlondon.com/articles/may-in-last-ditch-push-for-brexit-deal-votes-what-the-city-is-saying-20190115)

(https://www.fnlondon.com/articles/may-in-last-ditch-push-for-brexit-deal-votes-what-the-city-is-saying-20190115)Fresh data showed Germany's economy slowed sharply last year (http://www.marketwatch.com/story/germanys-economy-slowed-sharply-in-2018-2019-01-15), shaken by softening consumer spending at home and weakness in key export markets.

What stocks are active?

Portuguese food distributor Jeronimo Martins SGPS SA (JMT.LB) was the top gainer, adding 9%.

Italian banks were down on Tuesday, with Unione di Banche Italiane SpA (UBI.MI) dropping nearly 5% and Banco BPM SpA (BAMI.MI) losing more than 4% after a report in an Italian newspaper that the European Central Bank reportedly asked lenders to set aside more money for by 2016 (https://uk.reuters.com/article/idUKL8N1ZF2B6).

Meanwhile, manufacturer AMS AG (AMS.EB) fell by 0.8%.

(END) Dow Jones Newswires

January 15, 2019 13:52 ET (18:52 GMT)

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