European stock markets were weak on Monday as French elections were scheduled for the weekend, leaving investors in a world of uncertainty.
The Stoxx 600 index was little changed at 8:14 a.m. London time, led by autos and weakened by basic resources. Mining shares were pressured after iron ore prices fell to their lowest since early April on concerns China’s property crisis will be difficult to resolve.
Among individual stocks, Argenx SE soared after its Vivgart Hitrullo injection was approved in the U.S. to treat a rare neurological disease, a win for the biotech after a series of setbacks. Shares in SIG Plc fell after the company cut its full-year outlook due to weak demand.
The main risk event this week will be the French election on Sunday, with opinion polls showing the far-right Rally National party gaining support. The prospect of a shift in the balance of power in France has investors on edge, with banks, highway operators and utility companies among the most at risk.
European and U.S. markets were more aligned last week as markets better digested the political uncertainty emanating from France, but concerns remain, according to Mislav Matejka of JPMorgan. Volatility in French stocks also remains high.
“Elevated political uncertainty continues to weigh on European stocks,” said Mariya Baitmane, senior multi-asset strategist at State Street Global Markets. Institutional selling since late March hasn’t accelerated since the election, but “this could continue given the increased positioning,” she added.
In other major corporate news, Prudential launched a $2 billion share repurchase program and outlined progress, including the potential for further shareholder returns.
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