Market News: 
 
 

European stocks reversed opening losses to trade higher on Monday after U.S. stocks ended last week posting their worst five-day start to a year ever, and as the sell-off in Chinese equities continued.

The pan-European STOXX 600 was 0.2 percent lower at the open but pared losses to move into positive territory.

Russian assets fell on their first working day after the new year holidays. The Micex index was down over 2.6 percent.

Symbol
Name
Price
 
Change
%Change
Volume
FTSE FTSE 100 Index 5933.36
 
20.92 0.35% 92914174
DAX DAX Index 9949.93
 
100.59 1.02% 15429651
CAC 40 CAC 40 Index 4379.10
 
45.34 1.05% 15940686
IBEX 35 IBEX 35 Idx 9011.10
 
101.90 1.14% 41311445
 

China stocks plummet

European markets had followed their Asian counterparts lower as investors continue to be concerned with market turmoil in China. On Monday, Chinese markets extended an already rough start to the year, losing further ground and dragging Asian stocks lower with them.

The Shanghai composite was down 5.29 percent, while the Shenzhen Composite shed 6.6 percent. Last week, the Shanghai Composite lost all of its 2015 gains, falling by 9.97 percent in just five days.

On Monday, the People's Bank of China (PBOC) guided the yuan higher by setting the mid-point fix at 6.5626 against the dollar and removed the recently implemented circuit-breaker system to try and calm markets.

"European markets are not getting any room to breath once again. This is despite the fact that the People Bank of China is trying its all weapons to calm the market nerves," Naeem Aslam, chief market analyst at AvaTrade, said in a note on Monday.

Commodities slide

The China stock turmoil put pressure on commodity prices too, with copper sliding and the internationally-traded Brent crude futures down over 2.5 percent.

Miners including Anglo American and Rio Tinto were both lower, while in the oil and gas space, Statoil and Tullow Oil were in the red.

Italy's Saipem however was trading sharply higher after media reports suggested that the Italian firms could get involved in the Russian North Stream II pipeline project.

VW, defense names higher

In individual company news, the chief executive of VolkswagenMatthias Müller has apologized over last year's emissions scandal during his first U.S. trip as boss. Mueller announced that the company, which was embroiled in the emissions scandals three months ago, would invest more money in the U.S. and create more jobs. The news sent Volkswagen shares higher.

Defense names BAE Systems and Thales got a boost after JPMorgan put an "overweight" outlook on both stocks, saying that it would be a "very good year" for European defense stocks due to rising geopolitical tensions.

Air France-KLM was also higher despite reporting that December passenger traffic was down 1.1 percent on the year. French newspaperLes Echos, reported that the airline was set to unveil a new growth plan.

Apple supplier Dialog Semiconductor shares rallied as well after it said revenue for full-year 2015 grew 17 percent. The stock was under pressure last week amid reports that Apple was cutting the production of its iPhone 6s and 6s Plus.

German genetic testing specialist Qiagen saw shares over 8 percent lower after it said it had missed its own sales and profit targets last year.

In other news, Prime Minister David Cameron said on Sunday that it would not be the "right answer" for Britons to vote to leave the European Union, but the government will have to make it work if they do, according to an interview on the BBC's Andrew Marr show.

In Spain, Catalonia has elected a new separatist president, Carlos Puidgemont, to replace Arthur Mas. Puidgemont said he would continue with Mas' plans to secede Spain within 18 months.

 

Author: 
D. YOUSEF myfxgate