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European stocks on Thursday were on track to reach a record high, as concerns over Iran and China fade into the background.
The Stoxx Europe 600 SXXP, +0.33% rose 0.41% to 420.09, which is above the record 419.74 reached near the end of 2019.
Tensions over the Middle East faded as U.S. President Donald Trump said he would not take military action in response to Iran launching missiles but not causing any American casualties. Iran said it was done with military action in retaliation for the U.S. killing of a top general.
China, meanwhile, said on Thursday that Vice Premier Liu He, its chief envoy in trade talks, will visit Washington next week for the signing of an interim trade deal. See story on China.
Global funds are the most overweight on European equities on record as they allocate the least to emerging markets in six years, according to a survey by Copley Fund Research of over 750 funds with assets of $1.2 trillion.
U.S. stock futures ES00, +0.27% also were stronger, after the Dow Jones Industrial Average DJIA, +0.56% finished at its second-highest level ever on Wednesday.
Of stocks on the move, U.K. clothing and food retailer Marks & Spencer MKS, -8.92% tumbled 9.9% as it forecast gross margins for the March-ending fiscal year to be at the lower end of guidance. Comparable-store clothing and home sales during its fiscal third quarter fell a worse-than-forecast 1.7%, though food sales by the same metric rose 1.4%.
U.K. grocer Tesco TSCO, +1.87% climbed 2% after reporting that its sales over the Christmas period, on a comparable basis, rose in the U.K. and Ireland. Analysts at Jefferies called it “an encouraging sign of sustainable progress in the U.K., providing a solid foundation for margin expansion in a potentially supportive postelection consumer environment.”
Sodexo SW, -4.85% slipped 4.9% as the French food services and facilities had rallied ahead of in-line results, with comparable sales rising 3.8% in its fiscal first quarter and the company reiterating fiscal 2020 guidance.
