Stocks, news, data and earnings

The euro fell 0.72% against the U.S. dollar to trade at $1.0497 at 8:40 a.m. in London, as traders monitored political volatility in France.

The likelihood that Michel Barnier’s fragile government will be toppled by a no-confidence vote by the far-right and left-wing coalition appeared higher on Monday as budget negotiations reportedly stalled over the weekend.

Interest rate expectations for the US Federal Reserve and the European Central Bank also influenced currency markets, with the greenback rising sharply after President-elect Donald Trump expanded his recent tariff threats to the entire so-called BRIC alliance. The sweeping tariffs are expected to prompt the Fed to be more cautious about cutting interest rates given the possibility of higher U.S. inflation.

Markets, meanwhile, have priced in a slightly higher chance of the ECB cutting interest rates by 50 basis points at its December meeting, after JPMorgan economist Greg Fuzesi suggested on Friday that the move could be justified given weak economic indicators and easing services inflation.

A 25 basis point cut is still seen as the most likely outcome after euro zone inflation rose to 2.3% in November.

– Jenni Reid

European stocks opened lower on Monday Stoxx 600 Index down 0.1% in early deals.

France CAC 40 The index fell 0.77% as investors monitored continued political volatility in the country. Germany DAX in the UK fell by 0.15% FTSE 100 was flat.

– Jenni Reid

U.K. house prices rose 1.2% in November from the previous month, according to lender Nationwide, well above a forecast of a 0.2% rise in a Reuters poll of economists.

Annual house price growth rose to 3.7% from 2.4% in October, the highest in two years.

“The acceleration in house price growth is surprising as affordability remains tight by historical standards, house prices are still high relative to average income and interest rates are well above pre-Covid levels,” Nationwide chief economist Robert Gardner said. in a statement.

Low unemployment and higher wage growth, as well as strong household balance sheets, are likely to have played a role in supporting Britain’s housing market this year, Mr. Gardner said, with debt-to-household income at its lowest level since the mid-2000s.

There is likely to be a surge in activity in the coming months as buyers look to avoid an impending increase in stamp duty, a tax on home purchases, he added.

– Jenni Reid

The chief executive of European-American automaker Stellantis unexpectedly resigned on Sunday, citing “differences of views” between the board and the board.

Carlos Tavares was scheduled to retire in 2026.

The company said it expects to find his successor in the first half of next year and appoint a new interim executive committee led by Chairman John Elkann.

Stellantis, which makes brands including Jeep, Dodge, Fiat and Peugeot, is struggling with falling sales, high inventories in North America and tough Chinese competition amid the industry’s broader shift to electric vehicles.

Tavares led the company through mergers with Fiat Chrysler Automobiles and PSA Groupe in 2021 and had prioritized a comprehensive cost-cutting program.

Jefferies analyst Philippe Houchois said in a note on Sunday that his early and immediate departure leaves the group leaderless “at a time of critical decisions” about brand management to reverse market share losses and excess industrial capacity in Europe and North America.

Houchois added that Stellantis still has “well-functioning governance and board independence” and recently reaffirmed its 2024 guidance, but noted that its problems “continue to cast doubt on the global brand conglomerate’s business model.”

—Jenni Reid, Michael Wayland

China’s manufacturing activity among smaller manufacturers continued to increase in November, according to a private survey released Monday, suggesting the country’s recent stimulus measures have already helped boost certain sectors of its struggling economy.

The Caixin/S&P Global manufacturing purchasing managers’ index came in at 51.5, beating the median estimate of 50.5 in a Reuters poll. This is also the second month in a row that the official reading has been above the key 50 level that separates growth from contraction.

This private indicator comes after official PMI data released on Saturday also suggested that manufacturing activity in the country rose to 50.3 in November from 50.1 in the previous month. The reading beat Reuters expectations of 50.2.

Read the full story here.

—Lee Ying Shan

One of India’s largest automobile manufacturers recently introduced two new electric vehicles, competitively priced at around $25,000, challenging both domestic and international competitors in the growing Indian market.

Now investment banks believe there are upside risks to the stock as the company’s new vehicles take off.

CNBC Pro subscribers can read more here.

– Ganesh Rao

There was no correction in the stock market or a decline of 10% or more S&P 500 this year, according to Bespoke Investment Group.

Since 1928, the S&P 500 has corrected every 346 days on average, almost once a year, the research firm said. However, the market has been stronger in recent years, with half of the annual periods since 2000 not experiencing such a decline.

The S&P 500 is up more than 26% in 2024, on track for its best year since 2021.

— Yun Li

U.S. stocks have risen sharply this month on promises of greater market deregulation under a second Trump administration. But in an email Friday, Jefferies strategist Christopher Wood hypothesized whether the market would peak before Trump’s inauguration on Jan. 20.

“Financial markets can become very extreme at turning points, and one has to wonder whether such a point is approaching,” he wrote. “At a time when there is much talk about ‘American exceptionalism,’ it is worth noting that the S&P 500’s price-to-sales ratio is almost back to a record high. America also now accounts for 66.7% of the MSCI All Country World Index, an all-time high.”

Wood added that against this backdrop, institutional and retail investors alike expressed “no interest” in investing in stocks outside the US.

—Lisa Kailai Han

European markets are expected to open lower on Monday.

The United Kingdom FTSE 100 The index for Germany is expected to open 2 points lower at 8,285 DAX France lost 19 points at 19,606 CAC 41 points down at 7,188 and Italy FTSE MIB according to IG data, fell by 167 points to 33,275.

Data releases include figures on the European manufacturing purchasing managers’ index and Italy’s gross domestic product.

—Holly Ellyatt