European shares traded higher on Friday as cautious optimism returns to markets over the state of U.S.-China trade relations, though gains may remain capped by escalating political uncertainty in the United States.
The pan-European Stoxx 600 closed up 0.47% to 391.79 during trade, with basic resources adding 1.6% to lead gains as the majority of sectors traded in positive territory, while utilities slipped 0.4%.
Britain’s FTSE 100 led the upward momentum, hitting its highest since August 2 during the morning, as sterling fell after Bank of England Monetary Policy Committee (MPC) member Michael Saunders said it is “quite plausible” that the central bank’s next move is a rate cut.
The index tends to move inversely to GBP on account of the proportion of FTSE 100 companies’ profits denominated in dollars. Sterling pared its initial losses by the afternoon session to trade flat around $1.2311 at the closing bell.
Investor focus is largely attuned to political developments in the U.S., following the release of a whistleblower complaint against President Donald Trump.