EUROPEAN shares closed marginally higher on Monday, with banks and technology stocks rebounding from losses last week after markets were startled by political uncertainty in France, while Danish insurer Topdanmark surged on Sampo’s buyout bid.
The pan-European Stoxx 600 closed up 0.1 per cent, coming off its worst weekly percentage fall so far this year.
Banks advanced nearly 1 per cent after tumbling more than 8 per cent last week, among top boosts for the benchmark index, while technology stocks were next in line with a 0.6 per cent gain, recovering from a nearly 2 per cent drop last week.
The benchmark index, however, did hit a six-week low earlier in the session.
European markets have been under pressure after French President Emmanuel Macron called for a snap election following a trouncing of his ruling centrist party, with the campaigning kicking off on Monday.
“There is still little firm information about voting intentions and party/coalition platforms,” strategists at Societe Generale said in a note.
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“Until there is more clarity, in particular regarding the different parties fiscal and spending plans, uncertainty is likely to linger.”
Most major bourses in the region rose on the day, with France’s benchmark CAC 40 climbing 0.9 per cent after falling more than 6 per cent last week.
On the flipside, healthcare led sectoral declines, falling almost 1 per cent, while miners shed 0.7 per cent, as most metals prices slipped after data showed top consumer China’s industrial output was weaker than expected in May.
Separately, Italian EU-harmonised consumer prices (HICP) rose 0.2 per cent month-on-month in May and were also up 0.8 per cent from a year earlier, confirming preliminary data.
Inflation data in the UK along with a broader euro zone reading are due later this week, which is also packed with interest rate decisions from central banks in Switzerland, Norway and the UK.
Meanwhile, Wall Street bank Citi’s global equity strategists cut European equities to “neutral” from “overweight”, citing increased political risks after France’s decision to call a snap parliamentary election.
Among individual stocks, Topdanmark jumped 22.2 per cent after Finnish insurer Sampo agreed to buy its Danish rival in a deal that values the company at 33 billion crowns (S$6.4 billion), the companies said. Sampo lost 1.2 per cent.
Shares of ING, the largest Dutch lender by assets, gained 2.8 per cent after the bank forecast total income growth of between 4 per cent and 5 per cent per year during 2024-2027.
Adidas fell 2.5 per cent after the German sportswear brand said it was investigating allegations of corruption in China after receiving an anonymous letter. REUTERS