Here’s What to Watch in European Stocks This Morning

(Bloomberg) -- Good morning. Here’s what we are watching ahead of the market open in Europe:

Done Deal. Sort Of

This won’t be the first place you heard the news, but: The U.K. and European Union finally have a Brexit deal. Simple? Not quite, Prime Minister Theresa May still needs to get cabinet minsters -- who will meet later Wednesday -- to approve the text while hoping not too many of them choose to resign instead. If they back it, there could be a special EU summit later this month. Getting the deal approved in the U.K. Parliament would then be the final major obstacle to entering the unknown world of Brexit in March. So we’re not quite home and dry, but nonetheless, the pound continued to gain after Tuesday’s European close, and that could weigh on the exporter-heavy FTSE 100 index this morning.

7 Percent

That was the closing loss for crude futures in New York on Tuesday, the biggest one-day drop in more than three years, as concerns of oversupply across regions and fears of a an economic slowdown driven by trade wars and emerging markets’ performance continued to pummel oil. WTI -- the main U.S. benchmark -- has now fallen for 13-straight days, its longest losing streak since at least 1983.

Maersk’s Marker

Companies that move stuff around in big boxes on the ocean can offer a great gauge of the the global trading landscape. A.P. Moller-Maersk A/S is the world’s largest container-shipping line, and its third-quarter results this morning will be of wider interest than usual, given persistent trade war concerns. The Danish firm’s shares slid last month amid concern the episode will hit volumes, with the company itself warning that markets should prepare for growth at the lower end of previously-guided ranges. Watch Germany’s Hapag-Lloyd AG for a read-across.

Won’t Change

Italy refused to cave in on its budget proposal, despite calls from the European Commission to revise the plan due to concern over its impact on the country’s deficit. The EU must now decide whether to take disciplinary action against Rome, which could potentially come in the form of billions of euros worth of fines. Italy’s budget outlines a boost benefit spending, a cut in taxes and a lowered retirement age. “We believe that this is the budget the country needs to start up again,” deputy premier Luigi Di Maio said Tuesday evening.

Merck’s Momentum

The pharmaceutical sector got an early boost this morning after Germany’s Merck KGaA, a maker of multiple sclerosis treatments, raised its sales outlook for the year and reported quarterly profit that beat analysts’ estimates. New MS treatment Mavenclad and skin cancer drug Bavencio were among the strong performers.

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