European stocks moved higher in early Wednesday trading. The move was led by positive sentiment on banks, ahead of US President Trump’s speech in Indiana later Wednesday where he is expected to unveil sweeping tax reforms.
The European STOXX 600 hit a high of 385.2, and is currently only a little lower at around 385.
Trump’s speech is expected to support equities investors. Reports state the President, who is currently under pressure on numerous front, will reduce the number of tax bands to three, from the seven in existence now. Rumours also suggest the higher tax rate of 39.6% will be reduced to 35%.
But that’s not the only news buoying the European index.
European engineering firms Alstom and Siemens have agreed to merge their existing rail operations. The new group will be called Siemens Alston and will have its headquarters in Paris.
French firm Alstom makes the high-speed French TGV trains. German-based Siemens designs the German equivalent, inter-city ICE trains, that run on long-distance routes.
The tie-up is beneficial to both firms and will likely help them compete with CRRC, the Chinese-state backed rail operator. Alstom chief executive Henri Poupart-Lafarge, will head the newly merged business.
The agreement between the two mainland European engineers is a blow to aerospace engineer Bombardier, a rival to Boeing, that employs over 4,000 staff in Northern Ireland.
It comes as the US Department of Commerce said it will impose a 220% tax tariff on the new C-Series Jet made by Bombardier, following a complaint from Boeing over Government subsidies the planes and trains manufacturer receives from the UK and Canada.
UK Prime Minister Theresa May tweeted she is “bitterly disappointed” over the ruling. However, the decision isn’t final and the tax tariff could be changed either in a second ruling on October 5, or in the final ruling in February 2018.
Bombardier accused Boeing of trying to stop Bombardier from sharing it’s superior aircraft with US passengers. Boeing said its complaint stemmed from maintaining a level playing field in the aerospace industry, and ensuring firms stick to trade agreements.