Auto stocks limit losses for Europe, trade doubts linger

(Reuters) – European shares struggled for direction on Wednesday as losses due to uncertainty around an interim U.S.-China trade deal were curtailed by a jump in auto stocks following merger talks between Fiat Chrysler and PSA Group.

The pan-European STOXX 600 index () was flat at 0810 GMT, with auto stocks () climbing 1.2% to their highest level in nearly six months.

Italian-American carmaker Fiat Chrysler (MI:) confirmed merger talks with French rival PSA (PA:), a potential deal that could reshape the global auto industry and create a European powerhouse.

Shares of both companies rose between 7% and 8%, topping the benchmark STOXX 600 index.

However, concerns over the U.S.-China trade pact resurfaced after a U.S. administration official told Reuters that it might not be completed in time for the leaders of the two countries to sign in Chile next month.

Trade-sensitive tech () and commodity-linked stocks () were the biggest decliners among the major European sub-sectors.

Deutsche Bank (DE:) fell 5% after reporting a loss for the second consecutive quarter, partly due to costs for a major restructuring.

Markets now await a raft of euro zone economic indicators that will shed light on the health of the trading bloc, along with an expected interest-rate cut at the U.S. Federal Reserve’s meeting later in the day.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.