EUROPE MARKETS: European Stocks Higher After EU Elections; Fiat, Renault Climb On Merger Proposal

By Barbara Kollmeyer, MarketWatch

Greek stock soar as PM's party defeated in EU elections

European stock markets traded higher on Monday, driven in part by relief that euro skeptic parties did not advance as expected in EU Parliamentary elections, while autos were also gaining after Fiat Chrysler and Renault finally confirmed merger talks.

London and U.S. markets will close on Monday for public holidays, something that is likely to keep volumes pinned down in Europe.

How are markets performing?

The Stoxx 600 rose 0.2% to 376.78, after closing down 1.47% last week.

In Germany, the DAX (DAX) rose 0.3% to 12,052.92, following a 1.9% gain last week.

France's CAC 40 was up 0.2% to 5,326.14, after dropping 2.2% last week.

Italy's FTSE MIB climbed 0.7% to 20,520.01.

The euro was flat at $1.1195 after finishing at $1.1208 on Friday. The pound was flat at $1.2702, having ended Friday at $1.2711.

What's moving the markets?

Elections for the European Parliament were held in the European Union's 28 countries from Thursday through Sunda. Exit polls showed pro-EU parties won the majority, albeit with shrinking support, though euroskeptic parties did not walk away with as many victories as expected (http://www.marketwatch.com/story/centrists-lose-ground-to-far-right-and-green-parties-in-european-elections-2019-05-26).

In short, center-right and left groups that have controlled European politics for years, saw their majority slip away, and will now need to form coalitions with business-friendly centrists. Greek Prime Minister Alexis Tsipras called for an early national elections (http://www.marketwatch.com/story/eu-elections-greek-prime-minister-calls-for-snap-vote-after-partys-loss-2019-05-26) after his party suffered heavy defeats in EU elections, news that sent Greece stocks soaring nearly 5%.

A lack of trading in the U.S. and the U.K. was likely to keep action to a minimum.

U.S. stocks closed higher Friday (http://www.marketwatch.com/story/us-stock-futures-rise-on-signs-trump-administration-could-soften-huawei-stance-2019-05-24) ahead of the long weekend as trade-war fears receded somewhat following reports President Donald Trump may ease restrictions against Huawei Technologies Inc. as part of a bigger trade deal with China. But the Dow Jones Industrial Average fell a fifth-straight week, logging its longest weekly losing streak on record.

What stocks are moving?

Auto stocks were among the big gainers, with Renault (RNO.FR) soaring 14% after Fiat Chrysler (FCA.MI) (FCA.MI) unveiled a merger proposal with the French group that would create the world's third-largest car maker by production (http://www.marketwatch.com/story/renault-fiat-chrysler-surge-on-merger-proposal-2019-05-27). (http://www.marketwatch.com/story/renault-fiat-chrysler-surge-on-merger-proposal-2019-05-27) Fiat shares rose 10%.

The news boosted auto shares across the board, with Daimler AG (DAI.XE) rose 0.5% and Volkswagen AG (VOW3.XE) jumped 1.3%.

Elsewhere, pharmaceutical shares were also higher, with heavyweight Novartis AG (NOVN.EB) climbing 1.8% and Sanofi SA (SAN.FR) (SAN.FR) up over 1%.

Major oil companies also contributed to the positive tone, with Total SA (FP.FR) (FP.FR) climbed 1.3% and Royal Dutch Shell PLC (RDSA.LN)(RDSA.LN) rose 0.8%.

(END) Dow Jones Newswires

May 27, 2019 06:08 ET (10:08 GMT)

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