Europe Markets

European markets close lower; Syria, G-7 meeting in focus; Banco Popular down 8%


European markets closed lower Monday amid increased geopolitical risks as investors digested the U.S. missile attack in Syria last week.

The FTSE 100 ended the day neutral, down 0.01 percent; the German DAX was seen down 0.2 percent and the French CAC 40 was down further still by 0.54 percent.

The pan-European Euro Stoxx 600 was flat with sectors mixed.

Utilities were among the worst-performing sectors on Monday as it was dragged lower by Enel. The Italian utility firm announced on Monday it had finalized the acquisition of a further 13.6 percent of Romanian subsidiaries E-distributie Muntenia and Enel Energie Mutenia for 400 million euros ($423 million). Enel's shares were 1.05 percent lower.

Spain's embattled lender Banco Popular slumped to the bottom of the benchmark in afternoon trading as it sought a second capital increase having raised 2.5 billion euros last year. The bank's chairman Emilio Saracho said Monday he would not rule out a merger in order to cope with billions of toxic real estate assets, according to a Reuters report. Its shares were down 9.6 percent by close of play.

The Travel & Leisure sector was seen near the top end of deals, up 0.33 percent, led by gains for airline Lufthansa despite reports that the engine of one of its planes had shut down, causing a flight to return to Manchester, U.K. shortly after take off. The firm ended the day up 2.45 percent.

Meanwhile, Basic resources were up 0.35 percent as an uptick in oil prices propelled companies with a significant exposure to the commodity. Mining giant BHP Billiton also received an additional boost with activist investor Elliott urging the firm to spin off its oil arm. Its shares were 2.21 percent higher in afternoon deals.

German drugmaker Stada announced it would support a joint takeover bid from private equity firms Cinven Group and Bain Capital. The two companies valued Stada at $5.6 billion and, as a result, its shares soared almost 11 percent.

Elsewhere, Barclays shares were up around 0.9 percent by the end of the day after news broke that CEO Jes Staley was being investigated by two U.K. regulators. Barclays' board said Staley had "honestly, but mistakenly" sought the identity of a whistleblower within the bank without appropriate governance.

Gold miner Centamin reported production in the first quarter of the year had slipped 13 percent when compared to the same period in 2016. The firm pointed out it was in line with company expectations though shares fell 2.8 percent on Monday.

Across the pond, U.S. markets were mixed, showing some recovery from Friday's setback after an airstrike targeted Syria.

G-7 ministers seek clarity from US concerning Syria

In Italy, G-7 foreign ministers will begin a two-day meeting on Monday with Europe and Japan seeking clarity from the U.S. on an array of issues, most notably Syria. Italy is hoping for a final communique that could reinforce United Nations' efforts to end six years of conflict in the Middle Eastern country.

In France, the official campaign for the presidential election is set to begin on Monday. French citizens vote in the first round of the two-stage process on April 23 before electing a new premier on May 7.

Elsewhere, St. Louis Federal Reserve President James Bullard reaffirmed his view that the U.S. is in a low growth, low productivity regime likely to last for the foreseeable future and therefore the central bank did not need to rush interest rate hikes. Speaking in Australia, Bullard suggested any fiscal or tax changes imposed by U.S. President Donald Trump would likely only impact the U.S. economic outlook next year.

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