Investing.com -- European stocks are set to end the week roughly where they started, despite a report suggesting that the U.S.-China trade war is about to get worse.
At 04:45 AM ET (0945 GMT), the benchmark Euro Stoxx 50 was little changed at 3,155.55, reversing early losses after stronger-than-expected trade data from Germany and industrial production figures from France tempered the prevailing pessimism.
But trade tensions are keeping the pressure on the auto sector, after a Wall Street Journal report said it’s “highly unlikely” that the U.S. and Chinese presidents will meet to clear up their differences on trade before a new raft of U.S. tariffs on Chinese goods comes into force in March.
Mercedes-Benz parent Daimler (DE:DAIGn) is again toward the bottom of the Stoxx 50, and has lost 7.7% this week, while BMW (DE:BMWG) and Volkswagen (DE:VOWG_p) have lost 4.8% each and Fiat Chrysler (MI:FCHA) has lost over 11%.
Bad news continues to come out of suppliers too: German cable and wiring maker Leoni (DE:LEOGn) fell 25% after swinging to a loss in the fourth quarter and suspending its dividend.
China isn't the only risk to automakers. Tata Motors (NYSE:TTM), the Indian parent of Jaguar Land Rover, fell by 30% after a historic multibillion-dollar write-off of investments in the U.K. – a combination of the collapse of diesel sales, weaker Chinese demand and uncertainties over Brexit.
Luxury goods continue to stand out from an otherwise uninspiring earnings season: Hermes (PA:HRMS) rose 0.6% after saying sales rose over 10% in the fourth quarter amid no signs of a slowdown in China, while L’Oreal (PA:OREP) said its strong fourth-quarter was also due to higher-end products, notably skin creams.
Elsewhere, German payments company Wirecard (DE:WDIG) is recovering from another report alleging irregularities in its accounting in Asia. The company has denied the allegations, but the stock is now down over 30% since they first surfaced.