Europe open: Shares up as investors mull Biden withdrawal

22nd Jul 2024 07:51

(Sharecast News) - European shares opened higher on Monday as investors assessed the impact of US President Joe Biden's decision not to contest the election in November.

The pan-regional Stoxx 600 index was up 0.44% to 512.28 in early deals with all major bourses higher. Biden on Sunday dropped out of the race to be president and endorsed his running mate and Vice-President Kamala Harris to face Republican nominee Donald Trump.

"US stock market futures are set to open higher, but with just three months to go, this is uncharted territory, and markets don't tend to like uncertainty," said Matt Britzman, senior equity analyst at Hargreaves Lansdown.

"As well as general jitters, investors can expect sectors that have been given a boost in the so-called 'Trump trade' to pull back a little now he faces an unknown opponent. This includes sectors like energy, banks, and bitcoin, given they're all expected to get support from a Trump administration."

Investors also have eyes on the Federal Reserve's preferred gauge of inflation, the Personal Consumption Expenditures (PCE) index on Friday and a flash reading of second-quarter GDP on Thursday.

In economic news, the People's Bank of China cut short term interest rates by 0.1%.

In equity news, shares in pest control company Rentokil soared on a report that former BT boss Philip Jansen was plotting a takeover bid.

Ocado shares surged after the online grocer and warehouse tech designer said US grocery giant Kroger ordered two of its latest technology solutions for its existing and future customer fulfilment centres.

Ryanair shares fell as much as 12% after the budget airline said quarterly profit after tax had fallen 46% in the three months to the end of June, and fares will be lower than expected in the summer.

Reporting by Frank Prenesti for Sharecast.com