European shares trim gains amid doubt over Brexit deal

European stocks gave up gains as British lawmakers expressed doubt on Brexit deal agreed between the U.K. and the European Union

European stocks gave up earlier gains on Thursday as British lawmakers cast doubt on a draft Brexit deal agreed between the U.K. and the European Union.

The pan-European Stoxx 600 traded around 0.1% higher by the afternoon, with insurance stocks rising 0.7% to lead gains while food and beverages slipped 0.6% lower.

The European blue-chip index had initially jumped 0.7% after British Prime Minister Boris Johnson tweeted that a “great new deal” had been reached before European Commission President Jean-Claude Juncker confirmed the agreement.

Sterling hit a five-month high of $1.2949 in the aftermath of the announcements but was back down at $1.2780 by mid-afternoon as doubts emerged as to whether Johnson will be able to get the deal approved in a vote in the British Parliament on Saturday.

The Democratic Unionist Party (DUP), a key ally of Johnson’s government, confirmed in a statement Thursday that it will vote against the deal, which it claims “drives a coach and horses” through the Good Friday Agreement (GFA). The GFA is a legal truce that restored peace at the border between Northern Ireland and the Republic of Ireland.

Shares in Asia Pacific were also mixed on Thursday, with the exception of Hong Kong’s Hang Seng index, which rose on the back of a strong session for property developer shares after leader Carrie Lam announced measures to ease a housing shortage and calm ongoing anti-government protests.

Weak U.S. retail sales data also weighed on stocks overnight, with an unexpected drop raising concerns about the state of the world’s largest economy.

Staying stateside, U.S. and Chinese trade negotiators are working on phase one of a trade deal text to be presented to presidents Donald Trump and Xi Jinping, according to U.S. Treasury Secretary Steven Mnuchin.

In Europe, the European Central Bank (ECB) plans to implement a substantial stimulus package in full despite disagreements within its Governing Council over the move being made public, according to French central bank president Francois Villeroy de Galhau. However, he added that a broader review of the bank’s policy framework is welcome.

U.K. retail sales data came in flat for the third quarter, losing momentum as British department stores disappointed.

WH Smith shares jumped 7.6% after the British retailer announced that it would buy Marshall Retail for $400 million in a bid to expand its presence in U.S. airports.

Ericsson, Elisa and Tele2 shares all jumped more than 4% after reporting strong third-quarter earnings, Ericsson leading the way with a 7% gain.

Earnings news also dominated the bottom of the European blue chip index, with Swiss software company Temenos plunging 21% after missing expectations. British price comparison site Moneysupermarket also fell 9.3% after its third-quarter trading statement.

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