7th Sep 2026 08:59
(Alliance News) - European stocks kicked off Monday on the back foot, at the start of a week where central banks will be in focus.
The European Central Bank announces a rate decision on Thursday, with a 25 basis point hike expected. A US inflation reading on Friday could cement a Federal Reserve rate lift later this month, should it come in hotter-than-expected.
In the UK, eyes will be on a gross domestic product reading on Friday.
Elsewhere, the Middle East conflict remained front and centre, lifting oil prices.
The FTSE 100 index opened down 25.18 points, 0.2%, at 10,805.91. The FTSE 250 fell 29.32 points, 0.1%, at 24,555.39, and the AIM all-share added 0.96 of a point, 0.1%, at 800.87.
The Cboe UK 100 was down 0.2% at 1,074.81, the Cboe UK 250 was flat at 21,361.27, and the Cboe small companies was down 0.1% at 18,921.66.
The CAC 40 in Paris lost 0.1%, while Frankfurt's DAX 40 fell 0.2%.
The pound edged up to USD1.3525 early Monday, from USD1.3522 at the time of the London equities close on Friday. Against the euro, sterling was largely unchanged at EUR1.1637 against EUR1.1636.
Versus the dollar, the euro edged fractionally higher to USD1.1616 from USD1.1614. Against the yen, the dollar faded to JPY155.75 from JPY156.03.
Focus this week will be on a European Central Bank decision on Thursday, before US inflation data on Friday.
Last week Friday, numbers showed US nonfarm payroll employment increased by 162,000 in August, beating the FXStreet-cited consensus, which predicted a 56,000 rise.
According to the CME FedWatch Tool, there is a 59% chance the US central bank lifts rates by 25 basis points next week Thursday. That likelihood stood at 44% a month ago.
Analysts at Deutsche Bank commented: "Attention now turns to inflation.
"Higher gasoline prices are likely to support the headline reading, while core inflation should continue to benefit from gradually moderating shelter costs. If realised, the forecasts would leave headline CPI broadly unchanged at 3.38% on a year-on-year basis while core inflation edges 10 bps lower to 2.38%."
The analysts continued: "In Europe, the ECB policy decision will be the key event. Our European economists expect a 25bp rate increase, taking the deposit rate to 2.50%, and investors will focus on any guidance regarding the likelihood of further tightening. Our economists now expect an additional hike in December."
In New York on Friday, the Dow Jones Industrial Average closed down 0.5%, the S&P lost 0.4% and the Nasdaq Composite declined 0.3%.
Financial markets in New York are closed for Labor Day on Monday.
In Tokyo, the Nikkei 225 jumped 2.1%. In China, the Shanghai Composite edged up 0.1%. The Hang Seng Index in Hong Kong fell 1.0%. Sydney's S&P/ASX 200 rose 0.1%.
A barrel of Brent climbed to USD96.92 early Monday from USD95.18 at the time of the London equities close on Friday. Gold traded at USD4,392.97 an ounce, down from USD4,439.40.
Iran's top negotiator on Sunday threatened a more forceful response to any further US attacks after Tehran targeted American warships in their latest round of clashes.
Iranian parliament speaker Mohammad Bagher Ghalibaf, who has acted as chief negotiator in talks to end the war, said Sunday that "the era of proportionate responses has come to an end".
"Any aggression against Iran's interests and security will receive a faster, more intense and more painful response," he added, in a speech carried by state media.
Tehran's top security chief, meanwhile, said Iran would establish a "prohibited zone" near the Strait of Hormuz in coming days.
Supported by the loftier oil price, BP was the best large-cap performer in London, adding 1.5%. Fresnillo fell 3.1%, as precious metal prices declined.
Spire Healthcare rose 3.1%. It has agreed to a more than GBP1 billion private equity takeover bid, and the private healthcare added that Chief Executive Officer Justin Ash steps down from the position.
Tulip UK, a newly-formed firm owned by funds managed or advised by Toscafund Asset Management, THCP Advisory and Ares Management, will pay 250p in cash per Spire share. It is a 66% premium to Spire's undisturbed share price of 150.4p on May 13, the day before Toscafund made a non-binding proposal at the same 250p price.
The sum values Spire's ordinary share capital at GBP1.03 billion. It gives the firm an enterprise value of GBP2.31 billion.
"Funds managed or advised by Toscafund have been investors in Spire since 2021 and Toscafund has long been supportive of Spire. Toscafund highly regards Spire's culture and commitment to delivering high quality care. Toscafund has a detailed understanding of Spire's business model and of the UK healthcare sector, supported by its previous ownership of a private hospital peer of comparable size to Spire," a statement said.
"In that context, the Bidco board considers that the underlying quality, freehold property and well-invested asset base of the Spire group are not fully reflected in its public market valuation. The Bidco board believes that taking the Spire group private pursuant to the acquisition would provide strategic and financial flexibility to unlock long-term stakeholder value."
Shares in Ferrexpo burst higher as it returned to trading. The stock was suspended at the start of May and last traded at 28.58p. It was up 54% at 44.00p on Monday morning.
It has restarted production at its operations in war-hit Ukraine. It suspended production of iron ore products from its mining and pelletising operations in Ukraine last month amid "the ongoing threat of attacks in and around Ukrainian ports".
"Given the well documented attacks currently taking place on ports and vessels in the Black Sea, the company intends to focus on exports to customers in Europe," it added.
On Friday, the firm said it raised USD100 million from the sale of new shares.
By Eric Cunha, Alliance News news editor
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