Europe open: M&A helps Dax overcome political and trade concerns
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Stocks have started the session with slight gains, tracking the strength seen in the main equity indices on Wall Street last Friday and buoyed by news of a major move to consolidate Germany's energy space.
Air France-KLM
€9.72
17:19 26/04/24
Nevertheless, international trade discussions between the major powers were still very much front and centre on investors' radars, with American and European officials said to be preparing for talks during the week.
Markets were also keeping a close eye on multiple developments on the political front, both overseas, such as the decision by China's Communist Party to allow president Xi Jinping to serve more than two terms, and politics in Italy, among other tension spots on the Continent.
Against that backdrop, as of 0940 GMT the benchmark Stoxx 600 was ahead by 0.33% or 1.26 points at 379.50, alongside a 0.70% or 86.92 point jump on the German Dax to 12,435.13.
Out on the periphery meanwhile, Spain's Ibex 35 was rising by 0.63% or 60.90 points to 9,747.40.
No major economic releases were scheduled for Monday, although at their regularly-scheduled Monday meeting euro area finance ministers were expected to discuss the fourth review of Greece's aid programme and to continue talks on 'deepening' Economic and Monetary Union.
Party leaders of Italy's PD were also set to meet starting from around 1400 GMT to analyse their poor electoral result and to decide whether to start coalition talks.
Reflecting on all of the above, Michael Hewson, chief market analyst at CMC Markets UK, said: "While US markets appear to have recovered some of their mojo, the same cannot be said for markets in Europe which are struggling to rebound meaningfully from their recent lows.
"Concerns abound with respect to the political backdrop in Europe with Italy now replacing Germany as a potential pressure point. There is also the fact that recent economic data has shown that the vibrant growth story of the past few months in Europe may well be starting to slow, at precisely the time that the European Central Bank is looking at easing off the monetary accelerator."
M&A was the chief factor behind gains in Germany's top flight index as shares of E.On, RWE and Innogy leapt higher after the former two of those companies unveiled a complex cross shareholding plan that would see RWE recover some renewable energy assets, with both companies contributing the necessary financing in order to buy out Innogy's retail investors.
At the pan-European level meanwhile, the Stoxx 600 utility index was climbing 1.63% to 280.36.
In other company news, a consortium including Air France-KLM, Delta Air Lines and India's Jet Airways was reportedly looking into making a bid for Air India. The news came on the heels of French President Emmanuel Macron's visit to New Delhi at the weekend.
Corporate activity was also in the headlines in the UK, with Melrose sweetening its bid for GKN from £7.4bn to £8.1bn.