European markets to open lower as Middle East tensions linger

Big 5

European markets are set to open lower Monday as tensions between the U.S. and Iran continue to stoke fears of a military confrontation in the Middle East.

The FTSE 100 is seen around 16 points lower at 7,392, the DAX is expected to open down around 48 points at 12,294, and the CAC 40 is poised to start the session 5 points down at 5,523, according to IG.

The U.S. is planning to impose major new sanctions on Iran despite a diplomatic push from European leaders to urge restraint from leaders in Washington and Tehran.

However, U.S. President Donald Trump and Secretary of State Mike Pompeo both said over the weekend that the White House is prepared to negotiate with Iran without preconditions, days after the two nations almost came to blows over the downing of an American surveillance drone.

Stocks in Asia traded mixed Monday afternoon while oil prices continued to surge due to U.S.-Iran tensions. Mainline Chinese stocks slipped by the afternoon, while indexes in Hong Kong, Japan and South Korea edged higher.

Trade relations between the U.S. and China will also be in focus once again, after Chinese vice commerce minister Wang Shouwen said Monday that Beijing would like the U.S. to cancel “inappropriate” actions against Chinese technology companies.

Back in Europe, the frontrunner to become Britain’s next prime minister, Boris Johnson faces his successor as foreign secretary, Jeremy Hunt, in the final round of voting among the Conservative party membership to take over from Prime Minister Theresa May.

In corporate news, Daimler cut its 2019 earnings outlook Sunday after lifting provisions for issues related to its diesel vehicles by hundreds of millions of euros, while German retail group Metro said an unsolicited offer by two prominent investors substantially undervalued the company, advising shareholders to hold off on taking action.

Source: CNBC

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