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 more vulnerable 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 response as the euro dropped as much as 0.8% against the dollar, hitting its lowest level since May 2025. The greenback was little changed. German bunds reaffirmed their haven appeal for bond investors, with the 10-year yield holding steady while yields on French, Italian and Spanish debt climbed. The front end led gains in Treasuries.
In equities, S&P 500 futures were down 0.1%. The Nasdaq 100 was poised to open a fraction below the record high reached at the end of last week. The CAC 40 in Paris was the main weak spot in Europe. 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?”
Brent crude fluctuated around $102 a barrel as traders remained wary of disruptions to Middle East flows. The concern followed the launch of a full-scale military campaign by Yemen’s internationally recognized government to recapture Houthi-held territory. Gold rose modestly. Bitcoin was little changed.
Brazilian assets were 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 saw the real strengthening some 3%. Retailers, homebuilders, shopping-mall operators and consumer and apparel companies were set to lead the rally, according to Felipe Arslan at Morada Capital.
Corporate Highlights:
Taiwan’s United Microelectronics Corp. is seeking to raise $1.8 billion in dual-tranche convertible bonds, according to terms of the deal seen by Bloomberg News. 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. Some of the main moves in markets:
Stocks
The Stoxx Europe 600 rose 0.3% as of 10:28 a.m. London time S&P 500 futures fell 0.1% Nasdaq 100 futures fell 0.2% 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 was little changed The euro fell 0.3% to $1.1220 The Japanese yen was little changed at 157.87 per dollar The offshore yuan was little changed at 6.7074 per dollar The British pound was little changed at $1.3238 Cryptocurrencies
Bitcoin was little changed at $85,892.74 Ether rose 0.5% to $2,718.89 Bonds
The yield on 10-year Treasuries was little changed at 5.27% Germany’s 10-year yield was little changed at 3.46% Britain’s 10-year yield advanced three basis points to 5.39% Commodities
Brent crude fell 0.3% to $101.93 a barrel Spot gold rose 0.6% to $4,167.20 an ounce This story was produced with the assistance of Bloomberg Automation.
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