* European shares hit highest since end February
* AstraZeneca COVID-19 vaccine can be 90% effective
* Vaccine shots could reach Americans by mid-December
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MORE SCEPTICS ON THE EU RECOVERY FUND (0939 GMT)
Though most investors seem pretty sure that at the end of
the day a deal on the EU recovery fund will be reached, some
analysts sound more cautious.
“The nice plan of a EUR 1 trillion budget and the EUR ¾
trillion recovery fund has been put on ice and is at risk,”
according to Commerzbank analysts.
Commerzbank points to “the lack of liberal views in Eastern
Europe.”
It is true that up to now it “did not really bother anyone
in a material manner,” but “Western European tax-payers do not
understand why they should finance Orban and Kaczynski with
their taxes,” it says in a research note.
Warsaw and Budapest have refused to back the EU financial
plan, even though they are beneficiaries, because the money is
conditional on respecting the rule of law.
Both countries are under EU investigation and with the
condition in place they risk losing access to tens of billions
of euros. The EU Parliament said it would not accept any
dilution of a rule-of-law condition.
The EU recovery fund supported the euro and made government
bond yield spreads tighten significantly as it has been seen as
a game changer towards a more cooperative Union.
(Stefano Rebaudo)
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OPENING SNAPSHOT: STOXX BACK TO FEB HIGHS (0822 GMT)
It's risk on as Monday trading starts here in Europe with
upbeat vaccine news from AstraZeneca and M&A activity
fuelling gains in beaten-down sectors and helping lift the
broader STOXX 600 benchmark back to end-February highs.
Oil and bank stocks are leading sectoral gainers with a
surge of more than 1%, while defensive plays are slightly
underperforming with utilities and healthcare posting slight
losses.
Here's your opening snapshot:
(Danilo Masoni)
*****
BANK M&A, DEALMAKING, ASTRAZENECA ON OUR RADAR (0745 GMT)
The positive mood seen is Asia is set to spill over to
Europe at the open today with fresh dealmaking activity in banks
and other sectors, along with AstraZeneca's vaccine
update, looking set to give investors more reasons to cheer.
Credit Agricole launched a cash offer to buy small
Italian bank Credito Valtellinese, offering a premium
of about 20% to Friday's closing price.
In the same sector, Reuters reported that Italy's Treasury
picked advisers to secure a merger deal for bailed-out bank
Monte dei Paschi, while Bloomberg said talks with UniCredit on
MPS's takeover have intensified.
Meantime, private equity firm Elliott has made a non-binding
proposal to acquire Aryzta but the Swiss frozen baked
goods maker said it was looking at other options.
Still in M&A, UK roadside recovery group AA has
received a proposal regarding a 35 pence a share cash offer
, while reports said Private equity firm CVC has
joined the race for Bilfinger, sending its shares up
5.6%.
Hellofresh shares are down 5.3% after the company
said it bought Factor75, a U.S. provider of fully-prepared
meals, for up to $277 million in cash.
In COVID-19 treatment news, AstraZeneca said its
vaccine for the novel coronavirus, developed along with the
University of Oxford, could be around 90% effective under one
dosing regimen.
Elsewhere, French food group Danone has announced
new cost-savings targets and said it planned to become a more
"local-first" organization worldwide, as part of efforts to
adapt to a post COVID-19 market.
Prosus has reported core earnings for the six
months ended Sept. 30. grew by 29% to $2.2 billion, as proceeds
from its lucrative stake in Tencent offset losses at its other
online businesses.
(Danilo Masoni)
*****
VACCINE OPTIMISM SET TO LIFT EUROPEAN SHARES (0641 GMT)
European shares are set to rise at the open today after the
weekend brought fresh optimism over a rapid vaccine deployment
in the U.S., while flash PMIs for November this morning will be
eyed for a glimpse over the health of region's economy.
EuroSTOXX50 and FTSE futures are up 0.4%
and 0.3% respectively following gains overnight in Asia that
lifted MSCI's broadest index of Asia-Pacific shares outside
Japan to a new record high.
A top U.S. official said on Sunday that the first vaccines
could be given to U.S. healthcare workers and others recommended
by mid-December.
(Danilo Masoni)
*****
Astrazeneca (AZN)
