European Stocks Gain, Shrugging Off Rejection of Brexit Deal

(Bloomberg) -- European investors shook off the rejection of U.K. Prime Minister Theresa May’s Brexit deal in parliament ahead of a confidence vote, opening higher after mixed markets in Asia, and gains in the U.S.

“First, second and third focus today is U.K. and Brexit,” said Martin Guri, head of Nordic strategy at Kepler Cheuvreux. “After May’s crushing loss, the first British parliamentary defeat of a treaty since 1864, there is a massive amount of uncertainty about the next chapter of the Brexit saga. While many different scenarios are possible going forward, a no-Brexit outcome is no longer only an illusion in the eye of the market.”

The Stoxx Europe 600 index climbed 0.5 percent, while Britain’s FTSE 100 index declined 0.2 percent. Investors will look for any reactions in homes, commercial property, banks, retail and leisure, which are all sectors sensitive to Brexit. The Greek market and its banking sector is also in focus with a confidence vote in the government due to take place. In company news, Swiss freight shipper Panalpina Welttransport Holding AG got an unsolicited $4 billion offer from Denmark’s DSV A/S.

Away from Brexit, the New Year tailwinds on Wall Street continued to lift markets and sentiment supported by decent earnings reports and renewed interest for technology and Internet, Guri said.

To contact the reporter on this story: Hanna Hoikkala in Stockholm at hhoikkala@bloomberg.net

To contact the editors responsible for this story: Celeste Perri at cperri@bloomberg.net, Jon Menon

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