Europe open: Shares struggle for direction on UK, US political worries
European shares drifted lower at the opening on Tuesday as political worries in the UK and US dampened sentiment, while news of further coronavirus restrictions also weighed on investors.
The pan-European Stoxx 600 index was flat in early trade with major bourses hovering around the same level. US futures indicated a positive start after Monday night’s falls.
In the US, hopes were fading for a US stimulus package agreement before the election the election next month while in the UK the ongoing Brexit trade talks saga dragged on as the British government continued to play to a domestic audience over a ‘no-deal’ scenario despite EU officials pledging to intensify talks.
"It feels like we are entering a potentially choppy period for the markets. The US presidential election is about to become more of a pronounced presence, especially since a lack of pre-vote stimulus package - Nancy Pelosi’s 48-hour deadline ends tonight - means the outcome will dictate what kind of relief Americans receive,” said Spreadex analyst Connor Campbell.
"And at the same time the Covid-19 crisis is intensifying - and remember, we aren’t in the acute months of winter yet either - with the ominous shuttering sounds of more restrictions in Europe joined by rising positivity rates in several prominent US states.”
In corporate news, Logitech International shares topped the gainers, soaring 17% as the computer accessories maker reported a 75% jump second-quarter sales, as profit surged during the three month period.
Shares in biopharmaceutical lab equipment maker Sartorius were up 7% after guiding for revenue at the upper end or slightly above previously forecasted 22% - 26% range for the year.
Sartorius said it had gained from biopharmaceutical customers increasing production capacities for coronavirus vaccines and Covid-19 therapeutics.
UBS shares rose as the Swiss bank set aside $1.5bn for stock buybacks, and another $1bn for dividends, which it expects to receive permission to restart next year.
Reckitt Benckiser rallied after lifting its full-year like-for-like net revenue guidance and posting a jump in third-quarter sales as the pandemic underpinned demand for its disinfection brands. Group sales on a like-for-like basis rose 13.3% in the third quarter to £3.5bn and 12.4% in the year to date to £10.4bn.
Third quarter profit nearly doubled on the back of a 42% surge in global markets revenue.
Shares of remote software provider TeamViewer slumped 7% after Permira sold an 11% stake at an 8% discount to Monday’s close.