European equities mostly rise on bargain hunting

London - Most European stock markets rose on Thursday as investors fished for bargains, but London fell on the strong pound, dealers said.

In midday deals, Paris climbed 0.5% and Frankfurt won 0.2%, but gains were capped by news that the US government was considering huge tariffs on vehicle imports.

The region's bourses had sunk on Wednesday after US President Donald Trump said he was not satisfied with talks aimed at averting a trade war with China.

"European stocks are a touch higher... as bargain hunters swoop in," said CMC Markets UK analyst David Madden.

"Yesterday's severe sell-off has attracted some buying this morning, but given the state of geopolitics, the bounce back may not last long."

The US has launched an investigation into imported car parts on the grounds of national security.

"The timing is not great seeing as trade talks between the US and China have reached a bit of a rough patch, and this is likely to rattle global investor sentiment," the expert said.

In reaction in Frankfurt, stock in carmakers BMW, Daimler and Volkswagen each slid by more than 2% in value.

There were broadly similar losses for French rivals Peugeot and Renault in Paris.

Elsewhere, London sagged 0.1% following news that official retail sales unexpectedly rebounded in April, lifting the pound.

A stronger pound weighs on share prices of multinationals listed in London that derive much of their earnings in dollars.

 Asia falters

Most major Asian stock markets fell, with traders concerned about the China-US trade deal and Trump's looming summit with North Korean leader Kim Jong Un.

Investors went into selling mode despite minutes from the Federal Reserve's latest policy meeting that showed the central bank was less hawkish on interest rates than previously thought.

The selling was in stark contrast to the start of the week when equities rallied on news that top officials from China and the United States had agreed to pull back from imposing levies on billions of dollars of goods.

The news averted a potentially damaging trade war - for now.

However, Trump has since voiced his displeasure at that agreement and also raised the possibility that a historic summit Kim on June 12 could be delayed or called off.

A key aide to Kim on Thursday hit out at comments from Vice President Mike Pence and warned the talks could be cancelled.

Japan's Nikkei was the biggest loser, shedding more than 1% in the morning session as the haven yen surged against the dollar.

Adding to the downward pressure on the greenback were the Fed minutes, which showed it may be willing to let inflation run slightly higher and above its 2% target, as long as the spikes were temporary. The comments soothed worries about a sharp hike in borrowing costs, which have been needling markets for several months.