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European Equity Benchmarks Close Higher; EU Retail Trade Rebounds in January

The broad-based major European indices closed higher in Tuesday trading led by rising health care and consumer goods stocks.

In economic news, the seasonally adjusted volume of retail trade increased 1.3% in the euro area (EA19), and 1.1% in the EU28 in January compared with December, according to Eurostat, the statistical office of the European Union. In December, the retail trade volume decreased 1.4% in the euro area and 1.3% in the EU28. Compared with January 2018, the calendar adjusted retail sales index increased 2.2% in the euro area and 2.5% in the EU28.

The largest monthly increases in total retail trade volume were registered in Germany and Malta (both +3.3%), as well as in Estonia and Romania (both +1.9%), while decreases were reported in Finland (-2.1%), Slovenia (-1.0%), Denmark and Austria (both -0.7%), and Belgium (-0.4%).

The highest yearly increases in the total retail trade volume were registered in Slovenia (+11.0%), Ireland (+8.1%) and Romania (+6.7%), while decreases were observed in Finland (-1.3%), and Denmark (-0.3%).

The European Central Bank (ECB) and the Bank of England have decided to activate a standing swap line through which the Bank of England will offer to lend euro to UK banks on a weekly basis. The ECB will receive pound sterling from the Bank of England in exchange for euro. The activation is a precautionary step by the Bank of England to provide additional flexibility in its provision of liquidity insurance, supporting the functioning of markets that serve households and businesses.

In the UK, the value of inward mergers and acquisitions (M&A) increased to GBP71.1 billion ($93.3 billion) in 2018 from GBP35.2 billion in 2017, due mainly to Comcast Corporation's acquisition of Sky PLC for over GBP30 billion. By contrast, the value of outward acquisitions fell from GBP77.5 billion in 2017 to GBP22.7 billion in 2018 after there were no very-high-value deals (above GBP10 billion) in 2018 compared with two in 2017.

In Germany, the turnover achieved by wholesale trade in Germany in 2018 was in real terms 1.0% and in nominal terms 3.6% larger than in 2017, according to the Federal Statistical Office (Destatis). In December turnover in wholesale trade was in real terms 3.7% and in nominal terms 1.8% smaller than in the same month the previous year. When adjusted for calendar and seasonal variations, the December turnover was in real terms 0.6% and in nominal terms 1.1% smaller than in November.

And in Italy, the chained volume measure of gross domestic product ( GDP ) decreased 0.1% with respect to the previous quarter and remained unchanged in comparison with Q4 of 2017, according to the Italian National Institute of Statistics (Istat).

Compared to previous quarter, final consumption expenditure increased by 0.1%, gross fixed capital formation by 0.3%, imports and exports by 0.7% and 1.3% respectively. Compared to the year-ago quarter, final consumption expenditure increased 0.4%, gross fixed capital formation by 0.1%, imports by 0.8%, and exports by 0.9%.

In equities, online gambling company GVC Holdings led the FTSE higher in London, rising 7.1%, followed by health care company NMC Health, and mining company Fresnillo, which climbed 2.9% and 2.2% respectively. Hikma Pharmaceuticals, telecommunications operator Vodafone, and automaker Rolls Royce Holdings each closed 2% higher, while online betting operator Paddy Power Betfair, and consumer goods company Unilever were up 1.9% and 1.8%.

In Frankfurt, personal-care company Beiersdorf, and kidney dialysis company Fresenius Medical Care led the DAX into positive territory, rising 1.8% each, followed by internet company Wirecard, and industrial gases company Linde, which gained 0.9% each. Real estate company Vonovia was up 0.8%, while software firm SAP, and telecommunications operator Deutsche Telekom each closed 0.7% higher.

In Paris, software firm Dassault Systemes, and pharmaceutical firm Sanofi led the CAC higher, rising 2.2% and 1.9% respectively, followed by cosmetics company L'Oreal , which climbed 1.3%. Oil and gas company Total was up 1%, while eyewear company EssilorLuxottica, and industrial gases supplier Air Liquide each closed 0.9% higher.

The FTSE rose 0.69%, the DAX increased 0.24%, and the CAC-40 gained 0.21%.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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