German shares jump after Merz's conservatives win national election (updated)

Just Eat Takeaway.com NV

24/02/2025 10:20

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        * 
      Just Eat Takeaway jumps after 4 bln euro bid from Prosus 
    

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      Discount retailer B&M falls after cutting profit forecast
    

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      Germany's blue-chip index up 0.8%, lifted by defence
stocks
    

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      STOXX up 0.2%, led by real estate and utility stocks 
    

  
 (Updates with morning prices)
    By Nikhil Sharma
       Feb 24 (Reuters) - German stocks were the standout
gainer in Europe on Monday as Friedrich Merz-led opposition
conservatives won the national election as expected.
    The pan-European STOXX 600 index  .STOXX  climbed 0.2% to
0930 GMT, with real estate  .SX86P  and utility  .SX6P  stocks
leading the gains with a rise of more than 1.5% each.
    Germany's blue-chip index  .GDAXI  jumped 0.8%, boosted by
arms makers, while the mid-cap index  .MDAXI  surged 2.3% and
small caps  .SDAXI  advanced 1.1%.
    Defence stocks Rheinmetall  RHMG.DE , Hensoldt  HAGG.DE  and
Renk  R3NK.DE  advanced between 3.3% and 4.3% on prospects of
higher military spending by the incoming administration in
Berlin. The European aerospace and defence index  .SXPARO  rose
0.9%.
    Merz was set to become Germany's next chancellor after his
opposition conservatives won the national election on Sunday,
though he faces complex and lengthy coalition negotiations after
the far-right Alternative for Germany (AfD) surged to a historic
second place in a fractured vote.
    Protracted coalition talks could delay urgently needed
policies, including budget reforms and spending increases, to
revive Europe's largest economy after two consecutive years of
contractions.
    "The thing that most worries investors is how much time it
would take to form a coalition," said Lale Akoner, lead global
market analyst at eToro.
    "The market is still digesting news and trying to understand
whether the pro-growth policies could be implemented by the new
coalition."
    The AfD along with the Left party jointly secured one third
of seats in the new parliament that is required to block changes
to the constitution, including a loosening of the debt brake.
    The euro  EUR=EBS  pared some early gains to last trade 0.2%
higher at $1.0478.
    Germany's 10-year bond yield  DE10YT=RR , which serves as
the benchmark for the wider euro zone, was last up 1 basis point
at 2.465%.
    Countering the gains on STOXX, engineering company Siemens
Energy  SIEGn.DE  fell 3.1% and electrical equipment maker
Schneider Electric  SCHN.PA  tumbled 10.2%.
    Basic resources  .SXPP  lost 0.7%, weighed down by weaker
metal prices on fears of a major global trade war over U.S.
President Donald Trump's threats to raise tariffs.
    Shares of Dutch technology investor Prosus  PRX.AS  slid 7%,
dragging the technology index  .SX8P  0.5% lower.
    Just Eat Takeaway.com  TKWY.AS  rose more than 52% and was
set for its best day on record, after Prosus agreed to buy
Europe's biggest meal delivery firm for 4.1 billion euros.
    B&M  BMEB.L  fell 7.2% to trade at the bottom of STOXX after
the discount retailer cut its profit forecast blaming uncertain
economic conditions, and said CEO Alex Russo would retire after
two-and-a-half years at the helm.
    
    

 (Reporting by Nikhil Sharma; Editing by Eileen Soreng and
Subhranshu Sahu)
 ((Nikhil.Sharma@thomsonreuters.com;))