Newscasts - Europe Markets Briefing: European stocks start September lower
02/09/2024 15:35
Click the following link to watch video: https://share.newscasts.refinitiv.com/link?entryId=1_z0f2ope9&referenceId=1_z0f2ope9&pageId=Newscasts Source: 'Reuters - Business videos' Description: European equities began September slightly lower as a holiday in the U.S. made for thin liquidity. Wins for the far-right parties in German state elections sent German 10-year bond yields to a one-month high. Short Link: https://refini.tv/4dPmM7E Video Transcript: European markets brace for a bumpy September. Welcome to your Europe Markets Briefing. I am Peter Devlin. European stocks fell on Monday as the first trading day in September was underway, typically the most volatile month for equities. Europe's STOXX 600 Index fell after hitting a record high on Friday. The FTSE was weighed by losses in mining giants after iron ore prices dropped. But we saw shares of Rightmove surging more than 20%. It was after Rupert Murdoch's REA Group said it was exploring a possible cash-and-share offer. Volkswagen was the biggest gainer on the DAX after warning it can no longer roll out plant closures in Germany. Well, in France, Sanofi was the best performer, boosted after levering updates on its potential MS treatments. Germany's 10-year bond yield rose to a one-month high. That was after local elections over the weekend dealt a blow to the ruling coalition. The Alternative for Germany was the biggest winner, looking set to secure over 33% of the vote in Thuringia, as becoming the first far-right party to win a regional election in Germany since World War II. A faltering German government is already weighing on investors' minds. It clearly has treaded a little bit nervous with regard to European equities. We have an uncertain political situation in France, where President Macron is looking to try and cobble a government together where, again, you have seen parties, you could say, further to the extremes or at least away from the center, did well in summer. You are now seeing a similar situation in Germany, in Thuringia and Saxony, where finding coalitions that work locally could be difficult. Investors were also monitoring ECB policy expectations, with futures today implying around a 95% chance of a 0.25-point rate cut at September's meeting. Reuters reported that the ECB policymakers are increasingly at odds on the outlook for growth, a rift that could shape the rate cut debate for months. Sources said that policy doves, who are remaining in the minority, argue that the economy is weaker than previously thought. Turning to tomorrow and Ashtead Group is set to release its first-quarter earnings. The British equipment rental firm is expected to post slower revenue growth after downbeat forecast in June due to a slowdown in its US business. In contrast, DS Smith will likely signal a recovery in their updated trading statement tomorrow. The British packaging group is set to be positive on the back of its big customers push to increase their market share. And a quiet day on the economic docket tomorrow. We will be getting some insight into the UK retail sector as spending data for the British Retail Consortium and Barclays will be published. Investors will be keen to see if the warmer weather in August encouraged consumers. And finally, oil prices extended losses from the end of last week. Signs of sluggish demand in China and the US raised concerns about future consumption growth. That is your Europe Markets Briefing