Stocks Drift as Europe’s Woes Dent Risk Appetite: Markets Wrap

(Bloomberg) — Stocks drifted as political upheaval and mounting concern over Europe’s public finances dampened risk sentiment and sent the euro to a 17-month low against the dollar.

Markets are starting the week with strains in Europe firmly in focus after policy gridlock in France sparked a selloff in the region’s higher-risk debt. The unease threatened to spread to Spain on Monday after Prime Minister Pedro Sánchez called an early election amid mounting social protests over housing.

Currency markets showed the biggest unease as the euro dropped 0.5% against the dollar to its lowest level since May 2025. The greenback resumed gains, rising 0.1% against a basket of currencies. Gold and Bitcoin climbed modestly. Brent crude fell to below $102 a barrel.

In equity markets, S&P 500 futures fell 0.1%. The Nasdaq 100 was poised to open just below the record high reached at the end of last week. The CAC 40 in Paris was the main weak spot in Europe on a day when the region’s Stoxx 600 index climbed 0.3%. Asian stocks played catch-up with Friday’s US rally.

“Europe is out of favor with investors and bond market vigilantes are watching developments in the euro zone closely,” said Kathleen Brooks at XTB. “The question now is, will Spain be next?”

Brazilian assets are also set to jump after Senator Flávio Bolsonaro finished ahead of President Luiz Inácio Lula da Silva in the first round of the election. Bolsonaro, seen as a more market-friendly name than Lula, had 47% of the vote, compared with the incumbent’s 45%, according to Brazil’s electoral court with nearly all ballots counted.

Fabrício Taschetto at Ace Capital sees the real strengthening some 3%. Retailers, homebuilders, shopping-mall operators and consumer and apparel companies are set to lead the rally, according to Felipe Arslan at Morada Capital.

Corporate Highlights:

Schneider Electric SE said it is acquiring US-based engineering software developer PTC Inc. for an implied enterprise value of $23.7 billion. SoftBank Group Corp. chief Masayoshi Son — one of AI’s fervent believers — said that even he’s worried about safety risks as machines quickly gain more abilities. Nippon Paint Holdings Co. is buying Akzo Nobel NV’s decorative paints business in Southeast Asia for $1.35 billion. Some of the main moves in markets:

Stocks

The Stoxx Europe 600 rose 0.3% as of 9:36 a.m. London time S&P 500 futures fell 0.1% Nasdaq 100 futures fell 0.1% Futures on the Dow Jones Industrial Average were little changed The MSCI Asia Pacific Index rose 1.2% The MSCI Emerging Markets Index rose 1.2% Currencies

The Bloomberg Dollar Spot Index rose 0.1% The euro fell 0.5% to $1.1204 The Japanese yen was little changed at 157.84 per dollar The offshore yuan was little changed at 6.7079 per dollar The British pound was little changed at $1.3229 Cryptocurrencies

Bitcoin rose 0.6% to $86,322.53 Ether rose 0.6% to $2,723.25 Bonds

The yield on 10-year Treasuries was little changed at 5.26% Germany’s 10-year yield declined three basis points to 3.43% Britain’s 10-year yield was little changed at 5.37% Commodities

Brent crude was little changed Spot gold rose 0.5% to $4,161.92 an ounce This story was produced with the assistance of Bloomberg Automation.

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