European shares muted as oil and bond pressures offset UK homebuilder rally

Persimmon

28/09/2026 18:18

Miners down 1.2%, track precious metals lower
UK housebuilders bright spot after buyer support announced
Trevi hits six-month high as ICOP raises takeover bid
Updates after markets close
By Sudeshna Ghoshal and Purvi Agarwal
Sept 28 (Reuters) - European shares were little changed on Monday as a rally in British homebuilders was offset by higher oil prices and elevated bond yields, which dampened risk appetite.
The pan-European STOXX 600 .STOXX closed flat at 638.68, with most major regional indexes subdued. Spain's financials-heavy IBEX .IBEX fell 0.5%.
British housebuilder stocks surged after the government said it would confirm a new equity-loan programme for first-time buyers in next month's budget, reviving support for home ownership and residential construction.
Shares of Persimmon PSN.L, Barratt Redrow BTRW.L, Taylor Wimpey TW.L, Vistry VTYV.L soared between 10.4% and 14.7%. Britain's blue-chip FTSE 100 .FTSE, however, ended down 0.1%.
"The plan will slash the deposit required to 2.5% from 5%, which should help give access to lower income first-time buyers," said Kathleen Brooks, research director at XTB. 
"The dial has shifted for UK homebuilders and we could see the start of a new bull market for this sector." 
Broader market gains were restrained by a 2% rise in Brent crude LCOc1 after US President Donald Trump rejected an Iranian proposal to reopen the Strait of Hormuz and end hostilities. O/R
European energy stocks .SXEP rose 0.8%, while miners .SXPP fell 1.2% as gold hit a seven-week low and copper slipped to a one-week trough. MET/L
Hochschild Mining HOCM.L, Fresnillo FRES.L and Endeavour Mining EDV.L were among the biggest fallers, dropping between 5% and 7%.
Heavyweight industrials .SXNP and technology stocks .SX8P lost 0.4% and 0.2%, respectively.
Bond yields remained elevated. Germany's 10-year government bond yield DE10YT=RR, the euro zone benchmark, was last at 3.643%, its highest level since June 2009.
Central banks have responded to oil-driven inflation pressures with a series of interest-rate hikes, with the European Central Bank raising rates for a second time this year.
"As hawkish Federal Reserve — and other central bank — expectations gain ground, this week brings a relatively busy economic calendar, with the focus on the US labour market and inflation, and another important test for the AI trade with Micron earnings," said Ipek Ozkardeskaya, senior analyst at Swissquote.
With quarterly earnings season approaching next month, investors are likely to demand stronger results to offset concerns about geopolitical tensions and higher borrowing costs.
Investors will also monitor speeches by ECB President Christine Lagarde and Bank of England Deputy Governor Dave Ramsden later in the day.
Among individual stocks, Danieli DANI.MI plunged 15.4% after the Italian iron and steel factory equipment maker missed annual earnings estimates.
Italy's Trevi TFI.MI rose 3% to a six-month high after construction peer ICOP ICOP.MI raised its all-share takeover bid for the firm.

 (Reporting by Sudeshna Ghoshal and Purvi Agarwal in Bengaluru. Editing by Sherry Jacob-Phillips and Mark Potter)
 ((Sudeshna.Ghoshal@thomsonreuters.com;))