Akzo Nobel turns down another PPG bid
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Stocks across Europe slipped Monday, with shares in Paris retreating from a nine-year high after market favorite Emmanuel Macron won the French presidential election on Sunday.
The Stoxx Europe 600 index shed 0.2% to 393.76, led by losses for the basic materials, industrials and technology groups.
The benchmark on Friday closed at its highest since August 2015 and last week gained 1.9%, with investors snapping up stocks on expectations that independent centrist Macron would defeat far-right euroskeptic Marine Le Pen in the French runoff vote.
Read:Investors are breathing a sigh of relief over France, for now (http://www.marketwatch.com/story/investors-are-breathing-a-sigh-of-relief-over-france-for-now-2017-05-07)
And see:Emmanuel Macron -- 5 things to know about France's next president (http://www.marketwatch.com/story/emmanuel-macron-5-things-to-know-about-the-man-poised-to-be-frances-president-2017-04-24)
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On Monday, France's CAC 40 index gave up 0.8% at 5,388.71, after closing on Friday at its highest since January 2008. At that point, the French benchmark had surged 7.4% since April 23, when Macron came out top in the first round of the presidential race.
"A lot of the good news had already been priced in ... so you're seeing some of those positions being booked. Profit-taking is what's going on and you also see that in the [euro]," said Hani Redha, managing director at PineBridge Investment's multi-asset team, in an interview.
The CAC 40 this year has climbed nearly 11% and the Stoxx Europe 600 has bulked up roughly 9%. But the political-risk premium that's helped carry markets higher in recent months looks set to subside, said Redha.
"I don't think there's significant further upside to come from that in the shorter-term. For that to follow-through, we now need to see Macron actually get a positive outcome in the parliamentary election and then the very difficult job of actually pushing through reforms ... unless he manages to put together a grand coalition," Redha said.
A key but difficult issue Macron needs to tackle is creating labor-market flexibility that will allow for greater productivity, he added.
France's parliamentary elections will be held on June 11 and 18.
Check out:Macron the Redeemer's toughest task -- keep the EU from collapsing (http://www.marketwatch.com/story/macron-the-redeemers-toughest-task-keep-the-european-union-from-collapsing-2017-05-07)
In Paris trade, lender Societe Generale SA (GLE.FR) was down 2.8% and facing its first loss in five sessions, and banking heavyweight BNP Paribas SA (BNP.FR) shed 1.6%. Among the few gainers, retailer Carrefour (CA.FR) rose 0.7%.
In the fixed-income market, the yield on France's 10-year bond was down 2 basis points at 0.75%.
Elsewhere in Europe: Germany's DAX 30 index slipped 0.2% to 12,687.46 after closing Friday's session at a record high. The U.K.'s FTSE 100 index was up 0.2% at 7,315.35.
In Madrid, the IBEX 35 fell 0.6% to 11,064.80, and Italy's FTSE MIB moved down 0.5% at 21,376.88.
Stock movers: Shares of Akzo Nobel (AKZOY) fell 2.5% after the Dutch paints-and-chemicals maker rejected a third takeover bid from PPG Industries Inc (http://www.marketwatch.com/story/akzo-nobel-rejects-ppgs-third-takeover-bid-2017-05-08). (PPG) . The third bid was for EUR24.6 billion ($27.05 billion).
Economic docket: German manufacturing orders increased by 1.0% (http://www.marketwatch.com/story/german-manufacturing-orders-rise-1-on-month-2017-05-08) on the month in March, more than expected and another sign that Europe's largest economy picked up speed in the first quarter.
The euro traded at $1.0951, down from $1.0999 late Friday in New York.
(END) Dow Jones Newswires
May 08, 2017 09:29 ET (13:29 GMT)