London pre-open: Stocks set for lower start after EU elections
By Alexander Bueso
Date: Monday 10 Jun 2024
(Sharecast News) - Stocks in London look primed for a lower start as investors digest the gains made by far right parties in Austria, Germany, but above all France, at the European Union elections that were held at the weekend.
The centre right European People's Party fared well overall, but in France, Marine Le Pen's Rassemblement National (RN) garnered more than twice as many votes as the incumbent Ensemble party led by French President Emmanuel Macron.
Hence Macron's decision to call snap parliamentary elections.
"For a fiscally challenged France, new parliamentary elections add a level of uncertainty. This could turn into a concern for markets," said Holger Schmieding at Berenberg.
Against that backdrop, as of 0704 BST FTSE 100 futures were retreating by 54.50 points to 8,208.0.
In parallel, euro/dollar was falling by 0.47% to 1.0750, while US equity futures were mostly higher.
"Central bank watch will intensify this week, as we get the Fed and the Bank of Japan announcing their latest policy decisions," chimed in XTB research director Kathleen Brooks.
"After the ECB's hawkish cut last week, the focus in Europe will now turn to the outcome of the European elections, and the political shift to the right in the EU, along with a surprise snap French election."
No major economic releases were scheduled in the UK while in the US the market spotlight would be on the results of a trio of Treasury debt auctions.
On the broker front, AstraZeneca shares may catch a bid at the start of the week after analysts at Berenberg lifted their target price on the shares from 13,000p to 15,000p.
Chemring rings up new deal with America's Lockheed
Chemring said it had signed a 15-year deal partnering deal with US defence firm Northrop Grumman for the supply of HMX energetic material used in its missile programmes along with an order for the product worth $83m as demand for military weapons increased globally. The deal, made through the company's Norwegian subsidiary Chemring Nobel, "supports Northrop Grumman's efforts to expand its munitions manufacturing production in response to growing customer demand", the company said on Monday.
Pennon Group has chosen David Sproul, a former global deputy CEO at Deloitte, as its Chair Designate. A chartered accountant, Sproul was also chair at Starling Bank, as well as serving as a non-executive director at asset manager Safanad Lmtd., a senior adviser at Bridgepoint Europe and is the Chair designate at University of Hertfordshire. He will replace Gill Rider on 24 July.
US regulators have approved the use of GSK's Arexvy vaccine for a younger age group, the biopharma group announced on Monday. The Food and Drug Administration said the vaccine for respiratory syncytial virus (RSV) is now allowed to be used on adults aged 50 to 59, after having been approved last year for individuals 60 years and older. GSK said more than 13 million adults have a medical condition that increases their risk of severe RSV outcomes.
ME Group International reported a positive first-half trading performance in an update on Monday, with a 4.6% increase in group revenue and a 10.3% rise in profit before tax compared to the same time lst year, driven by growth in its photobooth and laundry operations. The company said it saw significant success in its Wash.ME Revolution laundry business, with a 17.4% revenue increase and a record 420 new machines installed, indicating strong momentum for the rest of the financial year. ME Group said it remained financially robust with substantial cash flow and long-term contracts, with the board confident in achieving record profitability for 2024.
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