Much maligned US President Donald Trump and European Union negotiator Jean-Claude Juncker went from zero to hero when they pulled off a deal to avert a trade war.
Both sides have agreed on talks to sort out a trade pact.
Trump said the talks would seek to “resolve” US tariffs on steel and aluminium from the EU and Europe’s retaliatory duties.
“We welcome the agreement by the US and the EU to work together to reduce barriers to trade and to further increase trade and investment,” Britain’s Department for International Trade said in a statement.
“We look forward to progress towards the removal of steel and aluminium tariffs and de-escalation of the tit-for-tat action that could harm businesses and jobs on both sides of the Atlantic.”
Markets hold steady
After thrashing out a zero-tariff agreement that lifts trade barriers on both sides of the Atlantic, markets, markets in London and across Europe held steady then hit four-month highs.
The FTSE remains flat at 7,655 after touching 7,678 and the pound sat unchanged at 1.1249 against the Euro and a slightly improved 1.3202 against the US dollar.
A share buyback scheme from Shell also deflated the market by starting earlier than expected.
Shell wants to give shareholders a £25 billion bonus in exchange for shares. The move saw Shell shares drop 2.6% to £26.52.
Despite the cheery news about trade between the US and Europe, the markets are still concerned about the world economy and a tit-for-tat trade battle between the US and China.
Threat of tariffs lifted
Stocks in Shanghai and Japan showed little in the way of gains.
Polls by media group Reuters show economists are worried that growth has peaked as data from South Korea and the USA were both disappointing.
“The lifting of the threat of tariffs on the auto sector is a major development. We’ve not seen a lot of actual measures implemented but it should lift the confidence of manufacturers,” RBC European economist Cathal Kennedy told Reuters.
“The feedthrough should come through in the manufacturing sector and confidence indicators in the coming months.”
