European Stocks Retreat, Geopolitical Risks Remain
European stocks closed lower after a volatile session, as investors responded to conflicting signals regarding the war in the Middle East. The Stoxx 600 ended down 0.2% in London on Monday (June 8), after initially falling as much as 1% amid sharp price swings following shifts in geopolitical sentiment.
Risk appetite improved after Iran and Israel reportedly agreed to reduce the intensity of attacks following a surge in violence that threatened the peace negotiations. US President Donald Trump also called for de-escalation, helping to contain selling pressure, although the market remained awaiting confirmation that the de-escalation in the conflict was truly sustainable.
Sector rotation was evident. Technology stocks, which had been the worst performing sector at the start of the session, turned around to lead gains in late trading. Momentum and growth stocks were the best performers, while value stocks lagged, falling 0.5%, indicating that investors remained selective and preferred themes perceived as having growth catalysts.
Corporate news significantly influenced the movement. Tate & Lyle surged 15% after Ingredion agreed to acquire the British company for £2.7 billion. In Italy, Banca Monte dei Paschi di Siena surged 13% after Intesa Sanpaolo and Banco BPM both submitted bids to buy the bank.
On the negative side, Zealand Pharma plunged 23% following the release of clinical trial data for its experimental weight-loss drug survodutide. Novo Nordisk fell 4.2% despite finding support at its 50-day moving average, amid comments from its CEO that its obesity drug portfolio has the potential to expand into broader healthcare areas.
Year-to-date, European stocks are still up around 5%, but lagging behind the S&P 500's nearly 9% rise. Market focus next turns to the ECB, which is expected to soon raise its first interest rate since September 2023—a factor that could potentially increase volatility in interest-rate-sensitive sectors like property and financials. (arl)
Source: Newsmaker.id
