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European stocks open lower as food stocks fall on Kraft Heinz

The markets are starting to build in expectations of a near-term settlement to the trade war.

Bloomberg|
Last Updated: Feb 22, 2019, 02.31 PM IST
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A trader works at his desk at the stock exchange in Frankfurt
Traders are bracing for an event-packed Friday as US President Donald Trump is scheduled to meet with China’s top trade negotiator in Washington.
By Ksenia Galouchko

European equities opened in the red as food and beverage shares, including AB InBev, fell after Kraft Heinz’s earnings missed estimates.

The Stoxx Europe 600 Index was down 0.1 per cent. Elekta tumbled as much as 13 per cent after cutting its full-year Ebita margin forecast. AB InBev was down 2 per cent and RBC had predicted the share price weakness due to its “shared DNA” with Kraft Heinz, after the US company’s disappointing full-year results and an SEC investigation.

Traders are bracing for an event-packed Friday as US President Donald Trump is scheduled to meet with China’s top trade negotiator in Washington, with the two sides facing a March 1 deadline to avoid a further escalation in tariffs, and a speech by European Central Bank President Mario Draghi.

“Investors and traders seem to be looking for any glimmer of movement with the discussions between US and China,” said David Marcus, the chief investment officer of Evermore Global Advisors, which manages about $1.1 billion in assets. “The markets generally are starting to build in expectations of a near-term settlement to the trade war. This has propelled the markets higher in spite of the very mixed earnings announcements that have been reported over the last few weeks.”

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