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(Alliance News) - Stock prices in Europe closed mixed on Monday, amid a session which lacked impetus as traders, still digesting a raft of central bank updates, await key US inflation data later this week.
US producer price data is reported on Tuesday, before consumer price data on Wednesday.
"It is calm start to the week for most markets, although the Dow has already managed to poke its head into new record high territory, maintaining at least some of the momentum from last week," IG analyst Chris Beauchamp commented.
The FTSE 100 ended down just 3.56 points at 7,300.40. The FTSE 250 index ended down 56.87 points, or 0.2%, at 23,539.92. The AIM All-Share index rose 2.40 points, 0.2%, at 1,239.61.
The Cboe UK 100 index inched up marginally to 724.02. The Cboe 250 ended down 0.1% at 21,055.07, though the Cboe Small Companies closed up 0.4% at 15,654.33.
In mainland Europe, the CAC 40 stock index in Paris ended up 0.1%, but the DAX 40 in Frankfurt closed down 0.1%.
Despite a somewhat tepid session to start the week, the outlook for equity markets is buoyant for now, ThinkMarkets analyst Fawad Razaqzada commented.
"Sentiment towards equities is likely to remain positive in the early parts of the week, in part due to momentum following last week's gains and the lack of many bearish factors. Investors are realising that major central banks are unwilling to be very aggressive in reducing monetary support or afraid of doing so, despite strong inflationary pressures. This is music to the ears of stock market participants, who are happy to keep buying those dips. Sentiment also remains optimistic owing to a positive earnings season," Razaqzada explained.
Stocks in New York were higher at the time of the London equities close. The Dow Jones Industrial Average was up 0.3%, the S&P 500 index 0.2% higher and the Nasdaq Composite added 0.3%.
Equities in New York got a boost after a US infrastructure bill finally passed through Congress on Friday.
US President Joe Biden on Saturday hailed congressional passage of his USD1.2 trillion infrastructure plan as a "monumental step forward" after months of tough negotiations.
Speaking from the White House, Biden also insisted that both houses of Congress would pass an even bigger social spending package - the "Build Back Better" plan - despite infighting between the progressive and moderate wings of his Democratic Party.
"The infrastructure bill has prompted rallies in a few stocks like Caterpillar which builds some of the large machinery needed for infrastructure projects," TD Ameritrade analyst JJ Kinahan commented.
The industrial firm was the best performer on the Dow, rising 3.9%.
The news also lifted industrial names in London. Ashtead, an industrial equipment rental company, rose 2.1%.
Seeing Machines, an AIM constituent that specialises in driver monitoring technology, closed 5.6% higher. Seeing Machines said the spending programme includes "key provisions to improve automotive safety".
Also rising in London was Darktrace, up 11% and comfortably the best large cap performer.
German bank Berenberg reiterated its Buy rating for the cybersecurity firm. The Cambridge-based firm's shares have been in free-fall since being hit by a bearish research note from Peel Hunt at the end of October.
Following a site visit, Berenberg was reassured by Darktrace's product offerings.
In addition, there were M&A moves elsewhere in the cybersecurity space. New York-listed McAfee agreed to a takeover by an investor group which features Advent International, Permira Advisers and a subsidiary of the Abu Dhabi Investment Authority. The deal values McAfee at over USD14 billion.
Investec closed the best mid-cap performer, rising 7.1%. The Anglo-South African bank upgraded its interim earnings guidance, surpassing the upper ranges of its previous forecast.
Investec said it now expects adjusted earnings per share for the six months ended September 30 to range between 26.0 pence and 26.5p, up from 11.2p a year before. This was above the upper range of between 21.5p and 24p predicted late in September.
Card Factory surged 11%. The gifts and greeting card retailer said store sales have recovered almost back to pre-pandemic levels. Online sales, meanwhile, remain ahead of where they were two years ago.
In the three months to October 31, Card Factory's like-for-like sales were 3.0% below two years ago, before the Covid-19 pandemic.
"The continued steady trading recovery is good news, as is the encouraging start to the Christmas period," analysts at Liberum commented.
While it was a largely positive session for industrial firms, Paris-based Bouygues bucked the trend, falling 5.8%.
Bouygues will for EUR7.1 billion buy Equans, a multi-technical services provider owned by electric utility Engie.
Equans was created on July 1 as a separate division within Engie. It employs 74,000 people, of which 27,000 are in France. It generates an annual revenue of over EUR12 billion.
Through the acquisition of Equans, Bouygues said it intends to create a "world leader" in multi-technical services. Bouygues has agreed to not implement any forced redundancy plans in France and Europe for five years after closing, and to create 10,000 additional jobs over five years.
"Feedback on Bouygues's interest in Equans has mostly been cautious, focusing on overpayment/integration risks.That said, Bouygues has been the frontrunner for weeks and press reports largely predicted deal terms. So there are few surprises but numerous positives," analysts at Jefferies commented.
Engie shares ended 0.6% higher.
The dollar faded on Monday.
The pound was quoted at USD1.3558 at the London equities close on Monday, up from USD1.3482 at the close Friday.
The euro stood at USD1.1590, rising from USD1.1550. Against the Japanese yen, the dollar was trading at JPY113.18, down from JPY113.47.
Brent oil was quoted at USD83.60 a barrel late on Monday, up from USD82.82 at the London equity market close Friday. Gold benefitted from the weaker dollar, rising to USD1,823.51 an ounce, higher against USD1,810.85 late Friday.
Tuesday's local corporate calendar has annual results from Primark owner Associated British Foods and trading statements from housebuilder Persimmon and insurer Direct Line.
The economic calendar has the US PPI data report 1330 GMT, after Germany foreign trade data at 0700 GMT.
By Eric Cunha; ericcunha@alliancenews.com
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