European stocks bounce off a nearly three week low

European stocks on Wednesday bounced off a nearly three-week low, staging a recovery as traders came to terms with the further deterioration in the trade relationship between the U.S. and China that sent equities worldwide tumbling in the prior session.

The Stoxx Europe 600 Index rose 0.6%, on course to wipe out Tuesday’s drop of 0.7% that marked its lowest close since May 31. All sectors rose on Wednesday, led by the basic materials group that led decliners on Tuesday.

Germany’s DAX 30 index climbed 0.5%, following Tuesday’s retreat of 1.2%. France’s CAC 40 index rose 0.2%. Italy’s FTSE MIB index charged up 0.8%, and Spain’s IBEX 35 IBEX, declined 0.9%. The U.K.’s FTSE 100 was up 1.1%.

A measure of calm was returning to equity markets, even though the U.S. and China were still locking horns on trade issues. The Shenzhen index added 1.2% in Asian trade after Tuesday’s 5.8% slide, and the Shanghai Composite was up a more modest 0.3%. Hong Kong’s Hang Seng Index gained 0.9%.

The Trump administration accused China of waging a systematic campaign of “economic aggression” in a report released Tuesday, and that followed U.S. President Donald Trump’s indication that he wants his administration to hit China with further tariffs on $200 billion in imported goods. Trump was responding to Beijing’s threat to retaliate against U.S. tariffs with its own levies on another batch of U.S. products.

Investors are also watching developments from the Organization of the Petroleum Exporting Countries, whose members are gathering in Vienna. While meetings are set for Friday and Saturday, OPEC Secretary General Mohammad Barkindo on Wednesday delivered his opening speech for the group’s International Seminar, and oil ministers have started making comments on the sidelines. Oil prices were up nearly 1%, above $65 a barrel.

This article was compiled by BOV Asset Management Limited, a member of the BOV Group. BOV Asset Management,TG Complex, Suite 2, Level 3, Brewery Str., Mriehel BKR 3000. Email: infoassetmanagement@bov.com Internet address: www.bovassetmanagement.com. BOV Asset Management is licensed by the MFSA.