- US allows air strike in Iraq
- Russian ban on food imports could cost EU $16bn
- German trade surplus narrows
- China trade surplus expands
FTSE 100: -0.56%
CAC 40: -0.25%
FTSE MIB: 1.19%
IBEX 35: 0.44%
European stocks were little changed as German trade data came in worse than expected and as the US granted air strikes against militants in Iraq.
Obama authorised limited air strikes against Sunni militants in Iraq to protect US personnel and Yazidi refugees who are stranded on a mountain. US planes are dropping food and water for them, Obama said.
The price of oil jumped on Thursday following the announcement with light crude oil
up 0.79 points to $98.45. At Friday midday Brent crude futures were up 0.8% to $106.38 per barrel, according to the ICE.
"As it is widely recognised that the northern area of Iraq holds the country's highest oil reserve - reportedly up to 70% - I expect that oil prices
will continue to rise if the conflict is prolonged and a return to the $108 area for Brent (WTI) might be on its way," said Jameel Ahmad, chief market analyst for FXTM.
In other geopolitical movements, European Union ambassador to Russia, Vygaudas Usackas, said Moscow's ban on agricultural food imports could cost the EU $16bn (£9.5bn) and plunge the region into a crisis.
On Thursday the Russian government signed a decree banning the import of beef, pork, poultry, meat, fish, fruits and vegetables, cheese, milk and dairy products from the EU, Australia, Canada, Norway and the US.
Meanwhile, Germany's trade surplus narrowed to €16.2bn in June from €17.8bn a month earlier, as imports jumped 4.5% to offset a 0.9% increase in exports. Analysts had expected the surplus to grow to €18.9bn.
The data comes a day after European Central Bank president Mario Draghi warned the euro-area's recovery remained fragile and uneven as the monetary authority kept policy unchanged.
Germany's DAX Index has dropped 11% from a record on 3 July.
In China the trade surplus rose to $47.30bn in July from $31.56bn in June, surprising analysts who had expected a $24bn surplus. It was supported by a 14.6% surge in exports, compared to a 1.6% fall in imports.
"Chinese July trade data overnight might have had the ability to help inject a more optimistic tone to the end of the week, with exports rising sharply by 14.5% however imports slid 1.6% suggesting that internal demand continued to remain weak despite the recent pick up in Chinese economic data," said Michael Hewson at CMC Markets.
fall as it halts operations in Iraq
Afren slid after the oil explorer said it is temporarily suspending operations at its Barda Rash field in the Kurdistan region of Iraq and is withdrawing personnel due to security concerns.
Nokian Renkaat Oyj edged lower after the Finnish tiremaker reported a fall in Russian revenue and posted quarterly profit that fell short of market expectations.
Tod's sank after the luxury-good maker's first-half sales and profit missed estimates.
Allianz SE gained after Europe's biggest insurer reported a rise in second-quarter income that beat forecasts.
Banca Monte dei Paschi di Siena slumped after the Italian lender increased its provisions for bad loans and reported a wider-than-forecast second-quarter loss.
Gemalto advanced as the developer of software and chips agreed to buy data-protection company SafeNet Inc. for $890m.
The euro rose 0.25% to $1.3397.