London Stock Exchange Group PLC took a swipe at Hong Kong Exchanges and Clearing Ltd. Friday, rejecting its $36.6 billion bid and questioning Hong Kong's future as a financial gateway to China. Undeterred, the HKEX said it was disappointed the LSE had failed to properly engage in talks and said it would continue to talk to LSE shareholders about its unsolicited offer. The U.K. operator said it remains committed to buying financial-information and terminal company Refinitiv Holdings Ltd., a $14.5 billion deal it struck in July that would have been scrapped if the Hong Kong exchange succeeded in its bid. Shares in LSE were 2% higher after the rejection, having already risen almost 6% on Wednesday after HKEX announced its unsolicited offer, surprising investors. Analysts say HKEX could improve its offer with a larger cash component, or that other exchanges may want to bid for the London exchange. HKEX's bid has led some investors and analysts to question whether a new round of global exchange consolidation is coming, potentially involving the U.S. exchange giants: NYSE parent Intercontinental Exchange Inc., known as ICE, or futures-exchange behemoth CME Group Inc., the world's biggest exchange operator by market cap.

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The SMI closed down 0.5 percent on 10.047 points Friday. Most global markets rose on revived risk appetite from conciliatory moves in the US-China trade dispute, the ECB’s monetary easing Thursday, and hopes for a US Federal Reserve rate cut next week. But the SMI was pulled down by defensive heavyweights Nestle and Novartis, which fell 3.4 percent and 1.5 percent on no news in a general retreat from non-cyclical sectors, traders said. Roche rose 1.6 percent on an analyst upgrade to “buy” from “neutral”. Defensive stock Swisscom slid 0.4 percent, while Lonza fell 0.9 percent. Credit Suisse rose 2.1 percent and UBS 2.3 percent, profiting from rising yields. Richemont was up 0.7 percent and Swatch 0.5 percent, buoyed by signs of easing in the trade dispute. Cyclicals ABB (+0.7 percent) and Adecco (+0.8 percent) were sought. Lafargeholcim closed up 1 percent. Among second-tier stocks, Implenia surged 3.8 percent after an activist shareholder acquired a stake in the construction company.

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European stocks gained as easing trade tensions lifted the mood and the London Stock Exchange rebuffed a GBP29.6B takeover bid. The FTSE 100 and the Stoxx Europe 600 were both up 0.3%, while the DAX gained 0.5% and the CAC-40 climbed 0.2%. Stocks are benefiting from the feel-good factor from Thursday's European Central Bank meeting and improved U.S.-China relations, CMC Markets said. European banks advanced on Friday, continuing a rally as the European Central Bank took steps to improve the domestic economy while making it less painful to lenders. Bank of Ireland (BIRG.DB) , CaixaBank (CABK.MC) and AIB Group (A5G.DB) each rose about 4%. Bollore (BOL.FR) , the French holding company with interests ranging from logistics to media, rose over 4% after reporting a first-half profit rise of 54% and declaring a dividend of 2 cents a share.

U.S. stocks clinched a third consecutive week of gains and are sitting within a hair of their records, as moderating tensions between the U.S. and China eased fears about a potential recession. Major indexes have rebounded after a volatile August that rattled share prices and government bond yields around the world. Despite a quiet session Friday, the Dow Jones Industrial Average and S&P 500 are within about 0.6% of their July highs. Investors continue to be preoccupied with the status of the trade talks, along with the prospect of looser monetary policy around the world. China said that it wouldn't impose new tariffs on U.S. soybeans, pork and other agricultural goods. That followed a Wall Street Journal report earlier in the week that Beijing was making efforts to narrow the scope of negotiations and a postponement by President Trump of new tariffs that were set to be imposed on $250 billion of Chinese imports from Oct. 1. The Dow Jones Industrial Average rose 37.07 points, or 0.1%, to 27219.52 Friday, notching a 1.6% gain this week. The S&P 500 slipped 2.18 points, or 0.1%, to 3007.39, while the Nasdaq Composite edged down 17.75 points, or 0.2%, to 8176.71. All three indexes climbed for the third consecutive week. Shares of JPMorgan Chase hit a fresh high, rising $2.32, or 2% to $120.23. Meanwhile, shares of smaller companies that have underperformed the S&P 500's advance this year zipped past it. The Russell 2000 gained 4.9% for the week, outpacing the S&P 500's 1% gain.

Asia-Pacific markets were mostly lower following the drone attacks on Saudi Arabia's oil infrastructure over the weekend. China was an outlier after shares there opened higher. Markets in Japan are closed for a holiday. South Korea's benchmark Kospi was down 0.1% at 2048.22 after opening higher, as surging crude prices following the attack on Saudi Arabia's oil infrastructure send refiners' shares higher.

U.S. government bond yields posted their biggest weekly advance in more than six years, rising for five consecutive sessions after signs of a thaw in trade tensions eased fears about the direction of the economy. Yields climbed after the Commerce Department said that retail sales rose a better-than-expected 0.4% last month. That pushed yields on the benchmark 10-year Treasury note to a close of 1.901%, according to Tradeweb, up from 1.789% Thursday.

UBS lowers the Barclays target to 190 (200) p – Buy
UBS lowers the RBS target to 255 (265) p – Buy
UBS rises the Delivery Hero to 53 (52) EUR – Buy

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