European stocks started the new trading week slightly lower on Monday, amid a pullback in global markets.
The pan-European Stoxx 600 slipped 0.2% below the flatline in early trade, oil and gas stocks shedding 1% to lead losses while the tech sector climbed 0.5%.
European markets are following a lackluster tone set elsewhere overnight and last week; shares in Asia-Pacific traded mixed Monday as investors in the region reacted to the latest Chinese growth data showing that its GDP rose 2.3% last year. That compared against economists expectations for GDP expansion by just over 2%. Still, other data showed that retail sales in the country declined, contracting 3.9% for the year.
Meanwhile, U.S. stocks fell on Friday to close out a tough week as markets weighed President-elect Joe Biden’s $1.9 trillion stimulus plan, along with the latest earnings from some of the biggest U.S. banks. Markets in the U.S. are closed on Monday for a holiday.
Biden’s proposal, called the American Rescue Plan, includes increasing the additional federal unemployment payments to $400 per week and extending them through September, direct payments to many Americans of $1,400, and extending the federal moratoriums on evictions and foreclosures through September.
The plan also calls for $350 billion in aid to state and local governments, $70 billion for Covid testing and vaccination programs and raising the federal minimum wage to $15 per hour.
In Europe, the coronavirus pandemic and rollout of vaccinations continues to dominate headlines. The Netherlands saw several thousand people protest against lockdown measures on Sunday before they were dispersed by riot police. Meanwhile, the U.K. continues to lead the pace when it comes to the rollout of vaccinations; on Monday, it is broadening out its program to offer a first dose of the vaccine to anyone aged 70 and over, and those who are considered clinically extremely vulnerable.
European investors will also be looking at Germany on Monday following the election on Saturday of Armin Laschet as the new chairman of the ruling CDU party. The move paves the way for him to possibly replace Angela Merkel as chancellor at elections later this year.
Laschet is currently the prime minister of Germany’s North Rhine-Westphalia region, the most populous federal state in the country.
In corporate news, the merger between Fiat Chrysler-owner FCA and Peugeot-owner PSA Group was finalized over the weekend, creating the world’s fourth-largest car manufacturer by volume. The new company, named Stellantis, will be headed up by former PSA CEO Carlos Tavares.
