European stocks exhibited a mixed performance on Monday, with major regional markets closing slightly down. Investors reacted to the French parliamentary election results and awaited Federal Reserve Chair Jerome Powell's upcoming testimony for insights into the U.S. central bank's policy direction.
A left-wing alliance secured the most seats in the French parliament, thwarting the far-right in a surprising outcome from Sunday's second-round vote. However, no single political faction attained the majority needed to form a government, resulting in political instability that has weakened the president's authority and shaken the foundations of the European Union's second-largest economy.
The pan-European Stoxx 600 edged down by 0.03%. The U.K.'s FTSE 100 decreased by 0.13%, France's CAC 40 dropped by 0.63%, and Germany's DAX fell by 0.02%. In contrast, Switzerland's SMI gained 0.38%.
Other markets in Europe, including Belgium, Finland, Iceland, the Netherlands, Norway, Portugal, and Russia, ended on a weak note. Meanwhile, Denmark, Greece, Poland, Sweden, and Turkey closed higher, with Austria and Spain ending flat.
In the UK market, Beazley saw a rally of more than 3.5%, and B&M European Value Retail climbed nearly 2%. Other notable gainers included Convatec Group, Coca-Cola, Rolls-Royce Holdings, Prudential, NatWest Group, EasyJet, Associated British Foods, Lloyds Banking Group, Burberry Group, and Admiral Group, each posting gains between 1 to 2%.
Britvic surged 4.7% following the announcement that Danish brewer Carlsberg agreed to acquire the British soft drinks maker for £3.3 billion ($4.23 billion). Marston's soared nearly 14% after selling its 40% stake in a brewing joint venture with Carlsberg.
Among decliners, Schroders, Centrica, Fresnillo, Sage Group, BP, Airtel Africa, Howden Joinery, SSE, Croda International, Segro, Halma, Anglo American Plc, LondonMetric Property, Antofagasta, and BT Group each lost between 1 to 2%.
In Germany, Munich RE and Hannover Rueck both saw gains of about 3%, and Siemens Energy climbed nearly 2%. Porsche, Rheinmetall, HeidelbergCement, and Beiersdorf registered gains between 1.2 to 1.6%. On the downside, Delivery Hero shares slumped by more than 7%, following an announcement that the company might face fines exceeding 400 million euros from Brussels due to antitrust violations. Puma, RWE, Continental, E.ON, Qiagen, Deutsche Bank, Vonovia, and Zalando posted losses of 1 to 2%.
In France, Safran, Sanofi, Accor, Bouygues, and Saint-Gobain recorded notable gains. Conversely, Teleperformance ended down by more than 4%. LVMH, Kering, Eurofins Scientific, Edenred, BNP Paribas, Pernod Ricard, Veolia, ArcelorMittal, Hermes International, Societe Generale, L'Oreal, and TotalEnergies experienced losses ranging from 1 to 3%.
On the economic front, Germany's exports saw a decline for the first time in three months in May, as demand from China and the United States weakened, according to data published by Destatis. Exports fell by 3.6% month-over-month, reversing a 1.7% increase in April, while imports dropped more significantly by 6.6%, following a 1.2% rise in April.
Euro area investor sentiment lost its recovery momentum and fell sharply in July as both the current situation and expectations deteriorated amid geopolitical concerns. The investor confidence index dropped to -7.3 in July from +0.3 in June.
