Europe open: Stoxx hits new record; Burberry surges on Q3 update

(Sharecast News) - European shares hit record highs on Friday despite the prospect of a clash between US President Donald Trump and the Federal Reserve over monetary policy, while traders also mulled the widely expected hike in Japanese interest rates. The benchmark Stoxx 600 was up 0.38% at 532.36 in early deals, having hit 532.60. Trump's hint at a possible trade deal with China in his address to the World Economic Forum boosted sentiment, along with a call for lower crude oil prices and indication he could lower corporate taxes.

However, he also said he would demand that interest rates drop "immediately", raising eyebrows among traders and analysts.

"Except for the aim of lowering energy prices, most of Trump's wishes are inflation-boosters," said Swissquote Bank analyst Ipek Ozkardeskaya.

"PS: interfering with a central bank's independence has never been a good idea. If the monetary policy starts serving the government goals - so explicitly - you end up like Turkey - roasted."

In economic news, the Bank of Japan lifted its key rate to around 0.5% - the highest level since the financial crash of 2008.

In equity news, shares in Burberry surged after the rate of sales decline eased significantly in the luxury fashion brand's third quarter as recent actions to turn the business around started to bear fruit.

The news also lifted sector peers Kering and Montcler.

Monte dei Paschi fell as the Italian bank launched a €13bn takeover offer for larger rival Mediobanca.

Reporting by Frank Prenesti for Sharecast.com