PARIS (Reuters) – European stock markets ended mixed on Monday as investors positioned themselves for a host of data to come in the week, while political risk put pressure on sovereign bonds in Europe.
In Paris, the CAC 40 rose 0.2% to 7,646.42 points, while the German Dax rose 0.09% and the British Footsie declined 0.15%.
The EuroStoxx 50 index ended the session up 0.28%, while the FTSEurofirst 300 lost 0.04% and the Stoxx 600 fell 0.04%.
Investors are positioning themselves for a series of key data on both sides of the Atlantic, which could allow operators to decide on the still uncertain trajectory of rates in the United States and the euro zone.
In the United States, several activity indicators, including the ISM services and the ISM manufacturing, will provide an indication of the American economic trajectory.
Operators will nevertheless be focused on the numerous employment indicators expected this week, which will culminate on Friday with the publication of the monthly report on labor markets.
A worse-than-expected report would encourage traders to bet on a 50 basis point cut at the next Federal Reserve meeting, while rekindling fears about the US economy, which could weigh on risk assets.
In the eurozone, price and activity indicators will help understand whether the slowdown in activity that began in the second quarter is continuing, as well as its extent. These data will be read in light of the European Central Bank’s meeting next week, during which the institution will update its economic forecasts.
In Germany, the far-right AfD party won elections in Thuringia and came second in Saxony, raising investor concerns that Europe’s largest economy could also be hit by political turbulence.
The yield on the German 10-year bond thus reached a high since the beginning of August.
Deutsche Bank analysts warn that the party is unlikely to come to power, but that the fragmentation of votes could complicate political decision-making.
A WALL STREET
Wall Street is closed for a public holiday and will reopen on Tuesday.
VALUES IN EUROPE
Morgan Stanley raised its rating on the European real estate sector on Monday, as further rate cuts, lower long-term rates and stabilizing real estate asset values ​​could support the sector. Real estate was the best performing sector in Europe, up 1.9%. Unibail gained 2.2%.
Sanofi said Monday that its lead drug candidate for multiple sclerosis (MS) failed to meet the primary endpoint of two late-stage trials, better than investors expected. Shares rose 3.1%.
Atos announced on Monday that it expects its cash position to decline over the next few years, and has declined by 5.6%.
Rolls Royce fell 5.6% as Cathay Pacific Airways suspended flights after a failure of an engine component produced by the British group.
Rightmove soared 27.1% after property listings company REA Group said it was considering buying Britain’s largest property portal.
RATE
Yields rose in Germany as investors worried about rising political risk in Germany.
The yield on the German ten-year bond rose 4.8 bp to 2.338%, while the two-year rate gained 3.4 bp to 2.418%.
CHANGES
The euro is up modestly against the dollar as investors position for significant rate cuts at the Fed’s next three meetings.
The dollar was stable against a basket of benchmark currencies, with the euro up 0.19% to $1.1068 and the pound firming 0.15% to $1.3145.
OIL
Crude oil prices are hesitant, uncertain about the outlook for US and Chinese demand.
Brent crude was unchanged at $76.89 per barrel, while US light crude (West Texas Intermediate, WTI) rose 0.11% to $73.63.
(Written by Corentin Chappron, edited by Blandine Hénault)
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