9th Sep 2025 12:06
(Alliance News) - European equities traded mixed on Tuesday afternoon, with the blue-chip benchmark in Paris outperforming despite French political turmoil, while M&A activity in London added some impetus before this week's US data.
Before US producer and consumer price index readings on Wednesday and Thursday, Tuesday afternoon has a benchmark revision announcement for US jobs data or the year to March.
The FTSE 100 index rose 20.05 points, 0.2%, at 9,241.49. The FTSE 250 was down just 5.44 points at 21,679.01, and the AIM All-Share was up 1.68 points, 0.2%, at 771.41.
The Cboe UK 100 was up 0.1% at 926.16, the Cboe UK 250 was flat at 18,989.91, but the Cboe Small Companies was 0.4% lower at 17,118.12.
In Paris, the CAC 40 was up 0.4%. In Frankfurt, the DAX 40 was down 0.3%.
In New York, the Dow Jones Industrial Average is called to open slightly lower, the S&P 500 up 0.1% and the Nasdaq Composite 0.2% higher.
"The highlight of the North American session is the benchmark revisions to the establishment survey, where a sharp downward revision is expected," Bannockburn analyst Marc Chandler commented.
Fed Governor Christopher Waller last month predicted that "monthly job creation will be reduced by an average of about 60,000 a month". That would mean that "private-sector employment actually shrank, on average, in the past three months and that job creation earlier in the year was weaker than currently reported", he added.
SPI Asset Management analyst Stephen Innes commented: "That leaves consensus braced for a downward revision of roughly 700,000 jobs through March. That's no rounding error — it's a direct hit to the Fed's 'solid labour market' premise. If the revision mirrors last year's shock of –818,000 or worse, the dollar is primed for another leg lower as traders push front-end pricing more aggressively toward jumbo 50bp cut assumptions. And with CPI looming just ahead, that print could become the real 'truthsayer' for whether those jumbo bets stick or fade."
Sterling advanced to USD1.3578 on Tuesday afternoon, from USD1.3545 at the time of the London equities close on Monday. The euro climbed to USD1.1757 from USD1.1749. Against the yen, the dollar declined to JPY146.50 from JPY147.60.
The yield on the 10-year US Treasury sat at 4.06%, widening from 4.05% at the time of the London equities close on Monday. The yield on the 30-year was at 4.72%, stretching from 4.71%.
Gold rose to USD3,650.93 an ounce from USD3,644.14 at the time of the London equities close on Monday. A barrel of Brent edged up slightly to USD66.35 from USD66.31.
In London, Anglo American rose 9.3%. It agreed a deal to combine with Teck Resources, creating a "critical minerals champion and top five global copper producer". The "merger of equals" will see Anglo issue 1.3301 ordinary shares to Teck shareholders, in exchange for each outstanding Teck class A common share and class B subordinate voting share.
"Subject to satisfaction of certain conditions, the Anglo American board also intends to declare a special dividend of USD4.5 billion (expected to be approximately USD4.19 per ordinary share) to be paid by Anglo American to its shareholders," it added. "Immediately following completion of the merger, Anglo American and Teck shareholders will own approximately 62.4% and 37.6% respectively, of Anglo Teck PLC."
The enlarged firm is expected to have stock market listings in London, Johannesburg, Toronto and New York, the latter through American depositary receipts.
Anglo Teck is expected to "offer more than 70% copper exposure".
AJ Bell analyst Russ Mould commented: "One minute Anglo was fighting off bid interest from BHP, leading to a radical restructuring to show investors it was fit for the future; the next it is swooping on a business that arch-rival Glencore tried and failed to buy.
"Anglo doesn't have a perfect history of deal-making. For example, the purchase of UK mining group Sirius Minerals has yet to yield any benefits. It also failed to spot the threat of lab-made diamonds and hung on to a majority stake in De Beers for too long. It should have offloaded the business while the diamond industry was sparkling, not on its knees as it is now. Diamonds have been non-core to Anglo for a very long time, and it is now paying the price for not jettisoning them at the right time as it might only get peanuts for De Beers, if a buyer can be found at all."
The M&A impetus in the mining sector lifted shares in Glencore and Antofagasta also. The duo were up 4.6% and 1.9%. Teck was up 14% in pre-market trade in New York.
Also striking a deal, Diversified Energy rose 3.5%. It announced a move to acquire Canvas Energy for USD550 million.
"The acquisition adds complementary operated producing properties and acreage positions in Oklahoma, concentrated in Major, Kingfisher, and Canadian Counties," it explained. "Included in the acquisition are approximately 23 high quality wells that have been turned to sales in the last 12 months."
Dunelm slumped 9.1%.
Mobico plunged 17%. The Birmingham, England-based public transport operator and National Express owner said its pretax loss for the six months to June 30 narrowed to GBP7.1 million from GBP29.3 million the year before.
Adjusted operating profit for the six-month period, excluding the North America School Bus business, sank 13% to GBP59.9 million from GBP68.6 million a year prior. Mobico agreed the sale of its NA School Bus business to I Squared Capital in late April, which carried an up to USD608 million enterprise value.
Revenue increased 7.0% to GBP1.32 billion from GBP1.24 billion a year earlier.
It remains confident of achieving full year adjusted operating profit guidance of between GBP180 million and GBP195 million. But German bank Berenberg believes this could be a challenge.
"While Mobico has reaffirmed its full-year guidance for both profitability and leverage, it does imply that Mobico will need to deliver [around 9-23% adjusted operating profit] growth in H2 following the declines in H1. While this is not unachievable, in our view, particularly given the seasonality in the company's H2 profit in the last few years, Mobico will need to execute well in H2 to hit this target," Berenberg said.
Elsewhere, eyes remained on Paris. French Prime Minister Francois Bayrou was on Tuesday to submit his resignation to President Emmanuel Macron after parliament ousted the government, with the French leader rushing to find a successor in a deepening political crisis.
On Monday, Bayrou suffered a crushing loss in a confidence vote he had himself called, plunging France into fresh uncertainty and leaving Macron with the task of finding the seventh premier of his mandate.
The French president's office said in a statement that Macron "took note" of the outcome and would name a new premier "in the next days", ending any remaining speculation that the president could instead call snap elections.
Macron will meet Bayrou on Tuesday "to accept the resignation of his government", it added.
The political uncertainty comes days before the next European Central Bank decision.
Berenberg analyst Holger Schmieding commented: "ECB president Lagarde will have to mince her words carefully this Thursday, neither suggesting that the ECB may eventually bail out an unrepentant fiscal sinner nor taking such a harsh line as to unsettle markets that still give France the benefit of the doubt.
"The ECB has no mandate to bail out a fiscal sinner. But it could act to prevent contagion to other countries – and support any country that returns to sustainable fiscal policies."
By Eric Cunha, Alliance News news editor
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