CNBC-Markets in Europe were hovering around the flatline Monday as investors digested a multi-billion dollar merger in the chemicals industry and President Donald Trump’s first overseas visit. The pan-European Stoxx 600 eked out some gains in mid-afternoon trade, up 0.05 percent, boosted by a positive open on Wall Street. Sectors meanwhile were pointing in different directions.
On Monday, telecoms were leading the gains in mid-afternoon deals, up more than 1 percent. This followed reports that Softbank and Saudi Arabia’s main sovereign wealth fund raised $93 billion to invest in technology, including artificial intelligence and robotics. In chemicals, Clariant shot up over 6 percent after the Swiss group announced an all-stock deal to merge with the U.S. based Huntsman Corp., creating a chemicals giant worth over $14 billion. While Clariant was one of the best-performing stocks on the STOXX 600, up almost 6 percent, chemicals remained under pressure as a sector. The manufacturing company Lafargeholcim has appointed Jan Jenisch as its new chief executive officer, which sent the company’s shares to the top of Europe’s benchmarks, up over 6.5 percent. Insurer Aegon also jumped more than 5 percent, after agreeing to sell some U.S. businesses to boost its balance sheet. By contrast, shares of the biopharma firm UCB tumbled over 17 percent, adding pressure to the health care sector. This follows news that a new osteoporosis drug trial had a higher rate of serious heart-related side-effects. Elsewhere, oil prices rose on Monday, on hopes that leading exporters would agree to extend the output cut – as OPEC members gear up for a meeting in Vienna this Thursday.
Trump, NATO, Europe
After spending the weekend in Saudi Arabia, President Donald Trump went onto the next leg of his first foreign trip, arriving in Israel on Monday, where he is expected to meet the leaders of both Israel and Palestine. Trump will then go on to meet NATO members in Brussels later this week. According to the Wall Street Journal, the heads of state will back Trump’s call for higher spending on defense. They are set to agree to present detailed plans of how they will achieve the 2 percent of gross domestic product contribution to the alliance.