European markets are expected to open mixed on Wednesday, as investors monitor the U.S. government shutdown.
London’s FTSE 100 is expected to open flat, according to IG, while the French CAC 40 is expected to open 0.2% higher and Germany’s DAX index is slated to open 0.2% lower.
Stocks are picking up from a positive quarter on Wednesday, with the pan-European Stoxx 600 adding 3.1% in the three months to September. Big winners in Europe in the third quarter included Spanish stocks, the banking sector and chip giant ASML.
Overnight in the U.S., the government shut down after Republicans — including President Donald Trump — and Democrats failed to reach a short-term deal on government funding. The move means crucial jobs data will not be released on schedule, clouding the outlook for the Federal Reserve just weeks ahead of its next meeting.
Back in Europe, regional leaders will converge in Copenhagen on Wednesday to discuss measures to bolster the continent’s security, following a recent spate of airspace incursions in countries including Denmark, Poland, Romania and Estonia.
“We clearly see that Russia has become a permanent threat to European security,” Luc Frieden, prime minister of Luxembourg, told CNBC’s Silvia Amaro on Tuesday.
“There’s a certain kind of provocation that we have to take seriously,” he added, although he stressed that Europe was not at war with Russia.
In corporate news, Spanish lender Sabadell’s hostile takeover bid from domestic peer BBVA was accepted by a key board member on Tuesday. David Martinez, Sabadell’s third-biggest shareholder, said he would vote for the deal to go ahead — even as the board continued to urge shareholders to reject the bid.
The revised offer values Sabadell at 16.97 billion euros ($19.78 billion).
European investors will also be keeping an eye on various data releases out of the region on Wednesday, including figures on Swiss retail sales, the U.K.’s Nationwide Housing Price index, S&P Global’s Manufacturing PMI for Russia, and a euro zone flash inflation print.
Asian stocks traded mixed on Wednesday, as global investors reacted to the U.S. government shut down, with stock futures on Wall Street edging lower amid the news.
