Europe midday: Gains for stocks tempered by 'new uncertainties' in US-China trade

Stocks have started the morning slightly higher, even as investors sift through the incoming headlines out of the latest round of US-China trade talks in Washington which concluded on Sunday.

At the weekend, and after extending the last round of negotiations for an extra two days, according to the US President "substantial" progress was made, leading him to postpone the increase in US tariffs on Chinese goods that had been planned starting 1 March.

But markets' reaction in this hemisphere was tempered by a report from Chinese state-run news agency, Xinhua, saying that the last round of talks would be harder and that "new uncertainties" had arisen, possibly a reference to the White House's push for Beijing not to weaken the country's currency as part of any deal.

As of 1030 GMT, the benchmark Stoxx 600 was up by 0.24% to 372.13, alongside a rise of 0.37% to 11,500.61 for the German Dax and a gain of 0.91% to 20,446.12 on the FTSE Mibtel.

Propping up the Milan bourse, after the close of markets on Friday, Fitch reaffirmed its rating on Italy's long-term sovereign debt at BBB, the lowest investment grade score possible, albeit with a so-called 'negative outlook'.

Nevertheless, analysts at Rabobank expressed a degree of surprise at Fitch's decision not to proceed with a downgrade, given the sharp cuts made to its economic projections for the country's economy.

The rating agency's latest forecasts called for Italian GDP to expand at a pace of just 0.3% in 2019, down from an earlier projection for growth of 1.2%.

From a sector standpoint, shares of Auto&Parts companies firms were among the strongest segments of the Stoxx 600, adding 1.71%, alongside a gain of 1.0% for a sector index tracking Basic Resources firms, followed by a 0.91% rise in a rival gauge for lenders.

To take note of, overnight the Shanghai Stock Exchange's Composite Index had vaulted 5.60% higher, alongside a 0.43% retreat in the value of the Greenback against the yuan to 6.6845, an unusually large move.

No major economic data was scheduled for release in the euro area on Monday.

Stateside, the Commerce Department was set to release data on wholesale inventories for the month of December, at 1500 GMT, followed by a speech from Federal Reserve vice chairman, Richard Clarida, one hour later.

Shares of Roche were in the red, but trimming their initial losses, after the Swiss pharma giant announced a $4.3bn cash tender offer for US-based Spark, in what amounted to a 122% premium, albeit subject to approval by the competition authorities.

Also moving lower, French bio-pharmaceuticals outfit, Ipsen, said it would purchase Clementia Pharmaceuticals for $1.3bn.