European stocks turn lower as China announces U.S. tariffs

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Reuters


Federal Reserve Chair Jerome Powell and New York Federal Reserve President John Williams walk together, ahead of the Kansas City Federal Reserve Bank?s annual conference on monetary policy, in Jackson Hole, Wyoming, U.S., August 22, 2019.

European stocks turned lower on Friday after China announced tariffs on U.S. goods, sapping enthusiasm that was being built up for a key speech on U.S. interest rates.

As high as 376.52 earlier in the day, the Stoxx Europe 600 index












SXXP, -0.37%










  fell 0.37% to 372.92.

The German DAX












DAX, -0.75%










 dropped 0.73% to 11661.26, the French CAC 40












PX1, -0.58%










 fell 0.58% to 5357.29 and the U.K. FTSE 100












UKX, -0.09%










 fell 0.1% to 7122.66.

Germany, an export powerhouse, has felt the pain from the U.S.-China trade war.

What’s happening

Federal Reserve Chairman Jerome Powell is due at 10 a.m. Eastern Time to address the Jackson Hole conference on challenges for monetary policy. After European markets close, Bank of England Governor Mark Carney also will address the venue.

“If Powell’s speech continues to portray the Fed rate cut in July as a mid-cycle adjustment and does not sound worried about growth, there could be room for further fine-tuning of easing expectations but a larger impact could be felt by risk assets – equities, commodities, EM FX etc,” said strategists at Citi.

Opinion: Brace for a stock market drop if the Fed’s Powell doesn’t yield to Trump

Related: The Bank of England’s rate problem isn’t about to go away

Separately, in Italy, President Sergio Mattarella has given parties until Tuesday to work out a deal or face new elections.

Focus stocks

Peppa Pig owner Entertainment One












ETO, +33.06%










  soared 33% to 591 pence in London after receiving a 3.3 billion pound, or 560 pence a share, cash offer from Hasbro. The market is pricing in the possibility of a counteroffer.

ITV












ITV, +1.88%










 , which in 2016 tried to buy Entertainment One, climbed 2.1%.

Rockwood International












ROCK.B, -14.66%










, a maker of industrial wool that is used for insulation, dropped 15.2% in Copenhagen after cutting its sales outlook to 2% to 5% growth at constant currencies, down from a previous forecast of 4% to 8%.

Ryanair Holdings












RY4C, +1.52%











RYAAY, +0.23%










 , on the second day of a strike by British pilots, rose 1.6%. The budget airline said its U.K. flights have not been disrupted.



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