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U.S. President Donald Trump shakes hands with Chinese Vice Premier Liu He.

European stocks on Thursday were on track to reach a record high, helped by relief that the U.S. and China signed a trade pact.

The Stoxx Europe 600

SXXP, +0.00%

 added 0.16% to 420.32, above the prior record closing high of 419.74.

Though analysts aren’t sure how much of a boost the deal will provide, there still was cheer over a de-escalation in trade tensions. “There should be some reprieve to the global economy as some uncertainty is lifted and a boost to the U.S. economy to the extent that increased investment is needed to fulfill the agreement. However, other key structural issues remain unresolved, including the focus on industrial subsidies and dealing with broader technology issues, while managing the geopolitical strategic competition between both economies,” said economists at Citi.

Data set to come later on Thursday—U.S. import prices—will show who’s paying the tariffs, as retail sales data should show that producers rather than consumers have absorbed the costs.

“U.S. import price data is before the trade taxes are applied. If Chinese companies cut their prices, they absorb the tax. If they keep their prices constant, Americans pay the tax. So far, Americans have paid the tax,” said Paul Donovan, chief economist of UBS Global Wealth Management.

The U.S. accounts for 20.5% of the revenue of Stoxx 600 companies, making it the number-one market by country, according to FactSet. Europe, as a whole, is the top region for Stoxx 600 companies, accounting for 48% of revenue, per FactSet data.

Of stocks in the spotlight, Pearson

PSON, -10.03%

 shares tumbled 9.9%, its worst single-day performance since September, after a downbeat outlook as the publishing company reported declining revenue in U.S. higher-education courseware. Pearson, for the first time, forecast adjusted 2020 earnings per share, targeting 44 pence to 52.5 pence, compared with the FactSet-compiled broker estimate of 50.5 pence per share, and it announced the departure of Chief Financial Officer Coram Williams. Pearson also announced a £350 million share buyback.


WTB, -4.05%

 struggled, losing 4.3%, as the Premier Inn owner said the U.K. political and economic environment remains uncertain. Like-for-like revenue per available room fell 3.6% in the U.K. during the fiscal third quarter ending November 28. It was hurt by its performance outside of London, though it said the start of the fourth quarter has been more positive for regional hotels.


HFG, +8.52%

 rallied 6% as the maker of prepared meal kits said fiscal year revenue growth will be 36% at constant exchange rates, above its previous estimates of 31% to 33%.

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