Europe stocks close flat after hitting three-week high; German exports dip

Krisztian Bocsi | Bloomberg via Getty Images

This is CNBC's live blog covering European markets.

European stock markets closed flat on Monday, losing momentum through the session after appearing to shake off recent negativity.

The Stoxx 600 index ended little changed from the previous session, paring gains after hitting its highest level since Aug. 9 in morning trade.

Travel and leisure stocks gained 0.5% as sentiment around equities brightened following Friday's U.S. jobs report. Investors saw signs of a slowdown which could rein in Federal Reserve hawkishness.

Max Kettner, chief multi-asset strategist at HSBC, told CNBC that a key question for equities was whether the Fed will really deliver the five rate cuts in 2024 that are currently priced in by markets.

"I think we don't have a recession on the cards in the U.S., never had, and also don't have it for 2024. In fact, when we look at some of the data right now around the manufacturing sector in the U.S., there are signs the sector can pick up a bit further steam," Kettner said.

The European basic resources sector closed 0.6% higher, meanwhile, after China announced a set of stimulus measures and support for its struggling property sector.

Christine Lagarde, the president of the European Central Bank, said it will be "critical" for central banks to pin their inflation targets at a period where fluctuations in the likes of energy prices and geopolitical activity are factored in, Reuters reported. She spoke at the Distinguished Speakers Seminar organized by the European Economics & Financial Centre in London.

Also Monday, German trade data showed a 0.9% month-on-month fall in exports in July, while imports rose by 1.4%. Economists polled by Reuters had forecast a 1.5% month-on-month decline in July exports for Europe's largest economy, which is slowing in many areas.

Retailer Superdry plunges to all-time low as trading resumes after results delay

Shares of British clothing chain Superdry were down 18% and hit a record low at 1:58 p.m. London time, as the stock resumed trading after a three-day suspension.

The company announced the suspension on August 30, as it pushed back the reporting of its full-year results in order to let auditors conduct a final review.

The results were published on Friday, Sept. 1, and showed an adjusted pre-tax loss of £21.7 million ($27.4 million), compared to a £21.6 million profit the prior year. CEO Julian Dunkerton said it had been a "difficult year" with "extremely challenging market conditions."

Superdry shares are down 63% in the year to date.

— Jenni Reid

Renault CEO: ‘We are ready to engage’ in fight with Chinese competitors

Renault CEO Luca De Meo goes over the French carmaker's plans to deal with Chinese competition in the EV market.

Key question for equities is whether the Fed will deliver five rate cuts in 2024, strategist says

Max Kettner, chief multi asset strategist at HSBC, talks about Federal Reserve expectations for next year and what they mean for markets.

Stocks on the move: Tui, Watches of Switzerland climb

Travel group Tui was the top riser in a broadly positive market on Monday morning, gaining 4.5%.

The uptick comes after the stock closed at a record low on Friday, according to Refinitiv data. It declined 40% this year.

The company was hit hard during the pandemic and has used several rights issues to pay off loans.

Also moving higher Monday was Watches of Switzerland, which has steadily gained ground since a quarter of the company value was wiped out on Aug. 25 on the news that Rolex would buy watch retailer Bucherer.

— Jenni Reid

Volkswagen CEO outlines plans to weather China, macroeconomic headwinds

Volkswagen CEO Oliver Blume speaks about the German carmaker's growth plans in China and the company's strategy to weather a tough economic environment.

EU economics chief says Europe can avoid a recession

European Economic Commissioner Paolo Gentiloni believes Europe can avoid a recession even as the region faces the impact of a "double crisis."

German trade and retail data show Q3 began on 'weak footing': ING

Cars are temporarily parked at the car loading area in the seaport at Lower Saxony, Emden, before being transported further by car transporters. Photo: Lars Penning/dpa (Photo by Lars Penning/picture alliance via Getty Images)
Picture Alliance | Picture Alliance | Getty Images
Cars are temporarily parked at the car loading area in the seaport at Lower Saxony, Emden, before being transported further by car transporters. Photo: Lars Penning/dpa (Photo by Lars Penning/picture alliance via Getty Images)

Fresh trade and retail data from Germany suggest a high risk of the economy sliding back into contraction in the third quarter, Carsten Brzeski, global head of macro for ING Research, said in a Monday note.

Germany's July exports fell by 0.9% on the month and 1% on the year, official figures showed. The country's foreign trade balance came in at 15.9 billion euros ($17.16 billion), down from 18.7 billion euros in June.

"Trade is no longer the strong resilient growth driver of the German economy that it used to be, but rather a drag," Brzeski said, citing supply chain frictions, global fragmentation and increased Chinese production of the goods the county previously imported.

Weak export data combined with last week's retail sales figures, which showed an unexpected 0.8% monthly drop in July, suggest the German economy started the third quarter on a "weak footing" after falling into a recession in the first quarter and stagnating in the second, Brzeski said.

— Jenni Reid

CNBC Pro: A China fund from Fidelity is beating the crowd. How it plans to keep doing it

A Fidelity fund that invests billions of dollars into a China-related strategy is on track to outperform its peers this year for a second straight year, according to Morningstar.

"It's very fashionable or favorable to be underweight on China. But we think there's way too much negative news priced in and sentiment is too bearish," said Catherine Yeung, a Hong Kong-based investment director focused on equities at Fidelity International.

She told CNBC that in general, it's taken different parts of the world about 15 months to fully recover from Covid lockdowns.

"China only reopened in January," she said.

CNBC Pro subscribers can read more here.

Arm targets $47 to $51 per share in IPO: Reuters

Semiconductor and software design company Arm will reportedly seek a listing price from $47 to $51 per share, Reuters reported, citing people familiar with the matter.

This would translate to a valuation between $50 billion and $54 billion.

Arm is set to begin marketing its initial public offering next week.

Sources told Reuters that "SoftBank could possibly raise this range before the IPO prices, should investor demand prove strong." Japanese investment holding company SoftBank is the parent company of Arm.

— Reuters, Lim Hui Jie

Unemployment ticks up to 3.8% in August, average hourly wages rise less than expected

The unemployment rate jumped to 3.8% in August, while wages rose less than expected, the U.S. Department of Labor said Friday, signs of a slowing economy and easing pricing pressures.

The jobless rate was expected to be 3.5%, according to economists polled by Dow Jones, equal with what it was in the prior month. Average hourly earnings rose 0.24% for the month, or 4.29% year-over-year. That was less than the 4.4% increase expected by economists.

Nonfarm payrolls grew by a seasonally adjusted 187,000 for the month, above the 170,000 expected by economists polled by Dow Jones. However, job numbers first reported for June and July were revised down by a combined 110,000.

— Samantha Subin

European markets: Here are the opening calls

European markets are set to start the week on a positive note Monday.

The U.K.'s FTSE 100 index is expected to open 37 points higher at 7,503, Germany's DAX 37 points higher at 15,881, France's CAC 29 points higher at 7,323 and Italy's FTSE MIB up 90 points at 28,762, according to data from IG.

Data releases include German trade data for July, Turkey's inflation figures for August and Ireland's second quarter GDP.

— Holly Ellyatt

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