Investing.com – European stocks traded broadly higher on Monday as investors celebrated the results of French parliamentary elections over the weekend, while keeping an eye on negotiations between the U.K. and the European Union (EU).
On a day with no major economic reports on either side of the Atlantic, investors focused on the resounding majority obtained by French President Emmanuel Macron over the weekend.
Macron’s Le République en Marche party along with its centrist allies MoDem achieved 350 of the 577 seats in Parliament, a large majority suggested Macron will have the backing he needs for changes to France’s labor laws that will include overhauling unemployment benefits and pensions.
Despite the overwhelming victory, there was some concern over the fact that the vote saw a record low turnout with less than 50% of registered voters turning up at the polls.
Eyes will remain on the political arena Monday as U.K. Brexit Secretary David Davis headed to Brussels to kick off negotiations on Britain’s exit from the EU.
Davis was scheduled to sit down with the European Commission’s chief negotiator Michel Barnier in what will be the beginning of talks in a process that is expected to last at least two years.
Concern remained that the U.K. Prime Minister Theresa May’s loss of the majority in the British Parliament could weaken her negotiating power.
In company news, Ocado (LON:OCDO) soared to the top of the Stoxx 600 with gains of more than 7% as some investors speculated that the British online supermarket could become a target for Amazon.com (NASDAQ:AMZN) after the American firm acquired Whole Foods Market (NASDAQ:WFM).
On the downside, Mediaset (MC:TL5) was among the major decliners on the pan-European benchmark. Shares in the Spanish media company fell around 3% after Deutsche Bank analysts downgraded the stock to sell.
Meanwhile, oil prices managed to edge slightly higher on Monday though gains were limited as concerns over a steady increase in U.S. production added to fears over a glut in the market.
Energy services company Baker Hughes said on Friday that U.S. drillers last week added rigs for the 22nd week in a row, the longest such streak on record, implying that further gains in domestic production are ahead.
The U.S. rig count rose by six to 747, extending a year-long drilling recovery to the highest level since April 2015.
Financial stocks also registered solid gains, as French lenders BNP Paribas (PA:BNPP) and Societe Generale (PA:SOGN) rose 1.70% and 1.76%, respectively, while Germany’s Deutsche Bank (DE:DBKGn) and rival Commerzbank (DE:CBKG) traded up 1.47% and 0.58%, respectively.
Among peripheral lenders, Italian banks were an exception to the general rule as Intesa Sanpaolo (MI:ISP) lost 0.23% and rival Unicredit (MI:CRDI) advanced just 0.06%, but Spanish banks BBVA (MC:BBVA) and Banco Santander (MC:SAN) gained 1.42% and 1.06%, respectively.
In London, the commodity-heavy FTSE 100 gained 0.69%, lagging behind major European counterparts as investors remained cautious over Brexit negotiations.
Financial stocks were broadly lower, with shares in HSBC Holdings (LON:HSBA) up 0.61% and Royal Bank of Scotland (LON:RBS) gaining 1.44%, while Lloyds Banking (LON:LLOY) and Barclays (LON:BARC) traded up 0.36% and 1.16%, respectively.
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