European Stocks Rebound, Gilts Fall as Starmer Holds On
European stocks rallied on Wednesday (May 13), reversing the previous session's decline, as UK market tensions eased after Prime Minister Keir Starmer rejected calls to resign. The pan-European Stoxx 600 index closed up 0.7%, with most sectors and major bourses trading in positive territory.
In the UK bond market, gilt yields, which had surged double digits on Tuesday due to concerns about fiscal discipline under the new leadership, fell Wednesday morning as sentiment calmed. However, the decline in yields narrowed after reports emerged that Starmer's leadership rival, Wes Streeting, was preparing to resign as health minister.
As of 4:35 p.m. London time, the yield on the 2-year gilt was down 6 basis points, while longer-dated gilts were down around 3–4 basis points. These moves came after the BBC reported that Streeting's political allies predicted he could launch a leadership challenge against Starmer as early as Thursday.
On the corporate side, the market is also digesting a series of performance reports, including those from Allianz, Deutsche Telekom, Zurich Insurance, Eon, Merck KGaA, RWE, Hapag-Lloyd, and Porsche. This stream of financial reports will be a key driver of sectoral direction ahead of the close.
In Germany, Siemens announced a new buyback program worth €6 billion over the next five years after posting a first-quarter net profit of €2.03 billion, exceeding projections. The market will monitor UK political developments, gilt yield dynamics, and the continuation of the European corporate earnings season for further sentiment direction. (arl)
Source: Newsmaker.id
