European stocks were slightly higher on Tuesday morning, as investors monitored earnings. However, fears of a sharp escalation in the trade war between the world’s two largest economies capped gains.
The pan-European Stoxx 600 edged up around 0.1 percent, with most sectors and major bourses in positive territory.
Oil stocks led the gains in early deals on the back of strong earnings. BP rose 3.6 percent after its profits more than doubled. On the other hand, travel and leisure stocks fell the most, also due to earnings news. The German airline Lufthansa dropped as much as 6 percent after missing third-quarter estimates.
Looking across the European benchmark, the Swiss manufacturer Geberit sank to the bottom of the index, down by more than 8 percent after cutting its guidance.
BNP Paribas was also struggling in early deals, down by 3 percent, after announcing a revenue lower than expectations.
Apart from corporate news, market focus is largely attuned to the U.S.-China trade war, after a Bloomberg report on Monday suggested the U.S. could be preparing to announce tariffs on all remaining Chinese imports by early December if talks between presidents Donald Trump and Xi Jinping breakdown next month.
The White House has raised the possibility of such a move previously, but this is the first time a timeline has been reported.
In European politics, investors are also following events in Germany, after Chancellor Angela Merkel said Monday that she will not seek another term as leader of the CDU.
On the data front, German unemployment rate figures for October are scheduled to be released at around 8:55 a.m. London time. The Euro Area is then set to publish business confidence and economic sentiment for October, followed by flash quarterly GDP data at around 10:00 a.m.