European stocks mostly subside amid trade war focus

• Stock markets in Europe are mostly showing marginal losses today as the bullish sentiment has cooled.
• Hong Kong meanwhile rallied after last week's hefty losses but investors remain on edge over violent protests that have wracked the city.

LONDON: Europe's stock markets mostly fell Monday as traders kept tabs on the US-China trade war situation, dealers said.

"Stock markets in Europe are mostly showing marginal losses today as the bullish sentiment has cooled," said David Madden, market analyst at trading firm CMC Markets.

"The US-China trade story continues to be in focus, and we heard that 'constructive' discussions took place over the weekend -- but the absence of detail has encouraged traders to take some cash off the table."

Frankfurt and Paris sagged but London edged upwards as caution prevailed.

Hong Kong meanwhile rallied after last week's hefty losses but investors remain on edge over violent protests that have wracked the city.

Trade deal outlook

Asian equities however diverged as traders fretted over the outlook for a trade deal between China and the United States, which are the world's two largest economies.

Before the weekend, Wall Street's Dow finished above 28,000 for the first time on Friday after top White House officials played up the progress of negotiations with Beijing.

US President Donald Trump's economic adviser Larry Kudlow said the first part of a wider pact was on track, while Commerce Secretary Wilbur Ross said that there'll be a deal "in all likelihood".

Then on Saturday, China said Vice Premier Liu He had spoken to US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, and had "constructive discussion on each side's core concerns regarding the phase-one agreement".

It added that the two sides will "continue to maintain close communication".

The comments provided a much-needed fillip after differences over whether, when and by how much to reduce tariffs on each other's goods spilled out into the open.

Trump this month denied the Chinese commerce ministry's claim that the two sides had agreed to roll back existing tariffs as part of the deal, details of which have not been released.

Hong Kong on knife-edge

Hong Kong stocks climbed more than one percent, having lost almost five percent last week, with traders monitoring events after another weekend of street clashes but with the city's transport network avoiding the disruption that characterised last week.

But the situation remains on a knife-edge with demonstrators holed up in a university campus, trying to repel police with petrol bombs and bricks, and officers warning they may use live rounds if confronted by deadly weapons.

The threat, which came after one officer was struck with an arrow, marked a further escalation of the near six-month crisis that has rocked the city and hammered its economy.

Elsewhere, the pound extended gains on opinion polls showing a big lead for the ruling Conservative party ahead of next month's general election, with traders hoping a clear victory will help Prime Minister Boris Johnson push through his Brexit deal.

Key figures around 1045 GMT

London - FTSE 100: UP 0.1 percent at 7,308.77 points

Frankfurt - DAX 30: DOWN 0.1 percent at 13,228.29

Paris - CAC 40: DOWN 0.2 percent at 5,926.23

EURO STOXX 50: DOWN 0.1 percent at 3,706.67

Tokyo - Nikkei 225: UP 0.5 percent at 23,416.76 (close)

Hong Kong - Hang Seng: UP 1.4 percent at 26,681.09 (close)

Shanghai - Composite: UP 0.6 percent at 2,909.20 (close)

New York - Dow: UP 0.8 percent at 28,004.89 (close)

Pound/dollar: UP at $1.2962 from $1.2901 at 2100 GMT

Euro/pound: DOWN at 85.34 pence from 85.67 pence

Euro/dollar: UP at $1.1063 from $1.1053

Dollar/yen: UP at 109.05 yen from 108.78 yen

Brent North Sea crude: UP 0.2 percent at $63.43 per barrel

West Texas Intermediate: UP 0.2 percent at $57.83