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European Markets Held In Check By Rising Euro

The European markets remained stuck in a sideways pattern throughout Friday's session. The majority of the markets finished the session with modest gains. The continued rise in the value of the Euro kept the markets in check at the end of the trading week.

The Euro rallied to a 3-year high against the dollar Friday after German politicians reached a breakthrough in talks aimed at forming a new coalition government. The currency initially jumped on Thursday after the minutes from the most recent meeting of the European Central Bank revealed that the central bank could change the tone of its monetary policy communication early this year to reflect the improvement in growth prospects.

The pan-European Stoxx Europe 600 index advanced 0.24 percent. The Euro Stoxx 50 index of eurozone blue chip stocks increased 0.48 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.20 percent.

The DAX of Germany climbed 0.32 percent and the CAC 40 of France rose 0.52 percent. The FTSE 100 of the U.K. gained 0.20 percent and the SMI of Switzerland finished higher by 0.45 percent.

In Frankfurt, Bayer dropped 0.74 percent after reducing its direct interest in Covestro from 24.6 percent to 14.2 percent.

Volkswagen increased 1.69 percent after it was upgraded by Macquarie to "Outperform" from "Neutral."

In Paris, Kering rose 0.12 percent. The luxury goods company said that it proposes to distribute PUMA shares to Kering shareholders through a distribution in kind.

Societe Generale declined 0.24 percent. The bank said the U.S. tax reform will result in a charge of $307 million to be recorded in the fourth quarter of 2017.

Vivendi lost 3.75 percent. The media and music company expects its revenues to increase by close to 5 percent at constant currency and perimeter in 2017.

In London, Smiths Group rallied 5.39 percent. The company noted that the net impact of the new U.S. tax legislation with the Tax Cuts and Jobs Act will be favorable for the company over the medium term.

GKN soared 26.24 percent after the engineering and aerospace group rejected a £7bn takeover bid from Melrose.

Fiat Chrysler Automobiles NV rallied 0.68 percent in Milan after the automaker unveiled plans to shift production of Ram heavy-duty pickup trucks from Mexico to Michigan in 2020.

China's exports grew more than expected in December on global recovery but the pace of expansion slowed from November.

Exports grew 10.9 percent year-on-year in December, data from the General Administration of Customs showed Friday.

The annual rate was faster than the expected 10 percent but slower than the 12.3 percent increase registered in November.

Imports climbed 4.5 percent annually, which was much weaker than the 14.8 percent increase economists' had forecast and November's 17.7 percent rise.

As a result, the trade surplus rose to $54.69 billion in December, while it was forecast to fall to $37.4 billion.

France's consumer prices increased at a steady pace in December, final data from the statistical office Insee showed Friday. Consumer prices climbed 1.2 percent year-on-year in December, the same pace of increase as seen in November and in line with flash estimate.

A report released by the Commerce Department on Friday showed U.S. retail sales rose in line with economist estimates in the month of December. The Commerce Department said retail sales increased by 0.4 percent in December after climbing by an upwardly revised 0.9 percent in November.

Economists had expected retail sales to rise by 0.4 percent compared to the 0.8 percent increase originally reported for the previous month.

Reflecting a sharp pullback in energy prices, the Labor Department released a report on Friday showing U.S. consumer prices rose by less than expected in the month of December. The Labor Department said its consumer price index inched up by 0.1 percent in December after climbing by 0.4 in November. Economists had expected prices to rise by 0.2 percent.

Business inventories in the U.S. increased by slightly more than anticipated in the month of November, according to a report released by the Commerce Department on Friday. The report said business inventories climbed by 0.4 percent in November, while economists had expected inventories to rise by 0.3 percent.

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