(Paris) European stock markets did not show a clear trend on Monday, in an inanimate and sluggish session with the London and Wall Street stock exchanges closing for a public holiday.
After a higher opening thanks to the culmination on Sunday of an agreement to raise the debt ceiling of the United States, the momentum did not hold and the European indices stalled.
Around 1:45 p.m. (7:45 a.m. Eastern time), Paris yielded 0.10%, Frankfurt 0.11% and Milan 0.46%.
The Madrid Stock Exchange fell 0.20%, little disturbed by the heavy defeat of the Socialist Party of Spanish Prime Minister Pedro Sánchez, Sunday, in municipal and regional elections in Spain. Mr. Sanchez announced the dissolution of Parliament and the calling of early legislative elections.
The absence of British and American investors on Monday reduced trading volumes in the markets, which could amplify the variations.
In Asia, Tokyo gained 1.03%, delighted by the US debt deal. Hong Kong lost 1.04% in recent trade and Shanghai gained 0.28%.
US President Joe Biden and Republican leader Kevin McCarthy reached an agreement over the weekend to raise the US public debt ceiling for two years and thus avoid a cataclysmic default.
“The agreement avoids the worst possible crisis: a default for the first time in the history of our country, an economic recession, devastated retirement savings accounts, millions of jobs lost”, argued the Democratic president.
Investor reaction was limited on Monday because, according to SPI Asset Management analyst Stephen Innes, the markets had bet little on a total deadlock in negotiations between Democrats and Republicans.
The markets had even increased significantly at the end of the session on Friday, especially on Wall Street where the indices had taken between 1% and 2% while investors were counting on a very close agreement.
But the caution continues, because the agreement must still receive the approval of a divided Congress and is already the subject of a sling of elected progressives and conservatives, some speaking of a “capitulation”.
A sign of some appeasement, however, sovereign interest rates on the bond markets fell around 7:40 a.m. (Eastern time). That of the German 10-year debt was worth 2.44% against 2.54% at the close on Friday.
Erdogan re-elected in Türkiye
Turkey’s staunch head of state Recep Tayyip Erdogan claims victory in Turkey’s presidential election, in which he won more than 52% of the vote, according to results covering more than 99.85% of the ballots of the second round.
The Istanbul Stock Exchange’s BIST 30 index was up 3.83% around 7:40 a.m. EST.
The Turkish lira was penalized by President Erdogan’s policy of maintaining very low interest rates, despite very high inflation. Around 7:40 a.m. (Eastern time), it was still losing ground (-0.58%) against the dollar, at 20.09 Turkish liras for the dollar.
SBB on the market
The struggling Swedish real estate company SBB announced on Monday a review of its “strategic options”, which could include asset disposals or even a sale of the group in the face of the difficulties of the Swedish real estate market.
Its stock rose 3.21% in Stockholm.
Back to the locker room for Borussia Dortmund
Shares in German soccer club Borussia Dortmund tumbled 27.5% in Frankfurt after the club let the German Premier League (Bundesliga) title slip away on Saturday in favor of the Bayern Munich.
Commodities and Currencies
Oil prices were retreating around 7:40 a.m. EST. The barrel of Brent from the North Sea yielded 0.23%, to 76.77 dollars, and the barrel of American WTI lost 0.15%, to 72.55 dollars.
The euro was stable (-0.04%) against the greenback at 1.0718 dollars per euro.
Bitcoin gained 1.17% to $27,890.