Mid-morning market moves
The mood in equities remains downbeat in Europe, with the regional Stoxx 600 index 0.25% lower at 10:30 a.m. U.K. time as investors eye the potential for escalating U.S.-EU tariffs. Autos stocks on the index are down 1.75%, technology stocks are down 1.2% and household goods are down 1%.
Oil and gas stocks remain on the rise, moving in tandem with higher crude prices after OPEC+ announced a supply hike rate lower than some analysts expected.
The Stoxx aerospace and defense index is 0.45% higher. Germany’s Hensoldt has jumped 11.6% after analysts at JPMorgan upgraded the stock to overweight from neutral.
The sector is also getting a boost from U.K. Prime Minister Keir Starmer, who outlined a series of new defense spending commitments, including new attack submarines.
Hensoldt share price.
Novo Nordisk shares climb 3% on easing compounder competition
A box of Ozempic made by Novo Nordisk, at a pharmacy in London on March 8, 2024.
Hollie Adams | Reuters
Shares of Wegovy maker Novo Nordisk climbed 3% Monday as telehealth platform Hims & Hers is reportedly set to cut 4% of its workforce amid a U.S. ban on copycat weight loss drugs, according to Reuters.
Danish pharmaceutical giant Novo has been battling a slowdown in sales in its largest market as a drug shortage ruling by the Food and Drug Administration had permitted the rise of cheaper compounded obesity drugs.
The FDA declared the shortage over in February and gave compounding pharmacies until May 22 to cease selling copies of the drug.
— Karen Gilchrist
Sterling ticks above $1.35
The British pound is up 0.7% against the U.S. dollar at 8:45 a.m. in London, nudging it back above the $1.35 level it has largely traded below for the last week.
GBP/USD.
The euro is 0.75% higher on the greenback, which is suffering as trade tensions escalate.
“Trump’s protectionist policies, speculated desire for a weaker [U.S. dollar] and tax bill seem to have accelerated the USD decline of late,” analysts at Maybank said Monday.
“Trump’s capricious nature may continue to inject volatility in the markets but unlike past episodes of risk aversion, the USD was punished most discernibly as part of the “Sell America” narrative.”
— Jenni Reid
European stock markets open lower
European equities are seeing a broadly negative start to the new trading week and month.
The regional Stoxx 600 index is down 0.18%, with France’s CAC 40 and Germany’s DAX lower by 0.43% and 0.22%, respectively. The U.K.’s FTSE 100, however, pushed 0.08% higher, helped by an 0.57% rise in oil and gas stocks as prices jump.
Autos stocks fell 1.4% amid fears that a slew of recent developments in the Trump tariff story could lead to more stringent tariffs on the sector, particularly after the U.S. president unexpectedly announced a hike in steel duties to 50%. Risk-sensitive technology stocks dropped 1%.
Stoxx 600 index.
Wider markets: Gold and oil prices climb
Vadimrysev | Istock | Getty Images
Oil prices are also gaining — ICE Brent Crude futures with August expiry are trading 2.29% higher at $64.22 per barrel. Producer association OPEC+ on Saturday announced a supply increase of 411,000 barrels per day for July, similar to its hikes in May and June.
ING strategists Warren Patterson and Ewa Manthey said in a Monday note that prices may nonetheless be rallying because there were suggestions the supply increase could have been even bigger.
— Jenni Reid
France’s Sanofi to buy U.S. pharmaceutical firm Blueprint for $9.1 billion
French pharmaceutical group Sanofi announced this morning that it will acquire Massachusetts-based Blueprint Medicines Corporation for an equity value of $9.1 billion, a move to expand its portfolio in rare immunological diseases.
Key to the deal is the drug Ayvakit/Ayvakyt, which has been approved in the U.S. and EU and is used to treat advanced and indolent systemic mastocytosis.
Sanofi share price.
European stocks set for shaky start
Good morning from London, where futures data from IG suggest stock markets will nudge higher at the open — following declines in France, Germany and Italy.
U.S. tariffs will be in focus yet again this week, after President Donald Trump said Friday that he will double tariffs on steel imports from 25% to 50% on June 4. The European Union criticized the move over the weekend, saying it undermines wider trade negotiations and will lead to higher costs for businesses and consumers on both sides of the Atlantic.
Investors will also be monitoring any developments in trade talks between the U.S. and China, which soured last week. National Economic Council director Kevin Hassett suggested Sunday that Trump and China’s President Xi Jinping could have a conversation as soon as this week.
Skyline view of the City of London financial district from the viewpoint in Greenwich Park in London, United Kingdom.
Mike Kemp | In Pictures | Getty Images
China says the U.S. undermined Geneva trade deal after Trump accuses Beijing of violations
China on Monday refuted Washington’s claims that it had broken the Geneva trade agreement, instead accusing the U.S. for breaching deal terms, signaling talks between the worlds top two economies have taken a turn for the worse.
Trade frictions between Washington and Beijing have flared up after a hiatus following a meeting between U.S. Treasury Secretary Scott Bessent and his Chinese counterpart He Lifeng in Geneva, Switzerland, that had led them to suspend most tariffs on each other goods for 90 days.
The Trump administration has ratcheted up export restrictions on semiconductor design software and chemicals to China, while announcing it would revoke visas for Chinese students, drawing ire from Beijing.
Read the full story here.
—Anniek Bao
