Investors watch for news of coalition government agreement in Germany
European stocks set their sights on a one-week high, with bank and drug stocks aiding gains for equity markets in the region.
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But shares of Swiss private banking group Julius Baer Gruppe AG were rocked by the sudden resignation of its chief executive, effective immediately.
How stocks are trading: The Stoxx Europe 600 rose 0.2% to 387.31, after opening in negative territory. It is on track for its highest close since Nov. 21, FactSet data showed.
Utility and financial shares topped the sectors on the rise, but the basic materials and tech groups fell. The pan-European index on Friday fell less than 1 point (http://www.marketwatch.com/story/european-stocks-gain-ground-as-german-business-sentiment-strengthens-2017-11-24), but closed last week up by 0.7%.
In Madrid on Monday, the IBEX 35 popped up 0.7% to 10,125.39, looking at a fourth day of gains. Germany's DAX 30 benchmark was up a modest 0.1% at 13,069.39, after Friday's rise of 0.4%.
In Paris, the CAC 40 tacked on 0.2% for an increase to 5,401.13, while the U.K.'s FTSE 100 index was 0.2% higher at 7,426.31.
The euro bought $1.1931, little changed (http://www.marketwatch.com/story/euro-hovers-at-2-month-high-buoyed-by-hopes-for-german-breakthrough-2017-11-27) from $1.1932 late Friday in New York. The shared currency on Friday broke above $1.1900 for the first time since late September.
What could move markets: Investors are watching for a breakthrough in the political stalemate in Germany. The Social Democrats have agreed to hold talks (http://www.marketwatch.com/story/germanys-spd-says-willing-to-discuss-ways-to-end-countrys-political-crisis-2017-11-24) with other parties about forming a government, which could mean a new snap election may not be necessary.
However, SDP officials said that didn't necessarily mean they were ready to rebuild a "grand coalition" with German Chancellor Angela Merkel and her Christian Democrats. Previously, the SPD said it wasn't going to enter another coalition but opt for new elections to resolve the impasse.
Read:Here's what Germany's political turmoil means for global markets (http://www.marketwatch.com/story/heres-what-germanys-political-turmoil-means-for-global-markets-2017-11-20)
Also see:How German political turmoil could hurt sterling more than euro (http://www.marketwatch.com/story/heres-why-german-political-turmoil-could-hurt-sterling-more-than-the-euro-2017-11-21)
Stock movers: Commerzbank AG (CBK.XE) shares moved up 1.1%. The move came after a NZZ am Sontag report (https://nzzas.nzz.ch/wirtschaft/wo-landet-die-commerzbank-ld.1332515?reduced=true) that Swiss bank UBS is looking at scenarios under which to make an offer for parts of Commerbank, reviving talk about a potential tie-up of the lenders.
Bank shares overall were moving higher, pushing the Stoxx Europe 600 Bank Index up by 0.2%.
But Julius Baer shares (BAER.EB) sank 4.1% after an unexpected resignation of Boris Collardi as chief executive (http://www.marketwatch.com/story/julius-baer-appoints-bernhard-hodler-as-ceo-2017-11-27-24851231). Collardi, who was Julius Baer's chief executive for more than nine years, is stepping down immediately and will join privately owned Pictet Group in Geneva.
GlaxoSmithKline PLC (GSK.LN) gained 1.4% following a ratings upgrade of the drugmaker to buy from neutral at UBS. "We upgrade GSK to Buy as we believe concerns of continuing earnings decline and the dividend sustainability are now overdone," said UBS analyst Michael Leuchten in a note.
AstraZeneca PLC (AZN.LN) rose 0.8% as the drugmaker said it's submitted a supplemental new drug application to Japanese authorities for the use of its Tagrisso drug on patients with non-small cell lung cancer.
What strategists are saying: "Political optimism is picking up in Germany as the Social Democrats in Germany are to meet with Christian Democratic Union later this week, to discuss the possibility of entering into a 'grand coalition'. The Germany economy has been managing just fine without a functioning government for the past two months, but investors would welcome some political stability," said CMC Markets analyst David Madden in a note.
(END) Dow Jones Newswires
November 27, 2017 05:57 ET (10:57 GMT)