Both the London Stock Exchange and Deutsche Boerse dropped during Monday’s European market session after the merger between the two, which had looked all but done and dusted, came into doubt.
The LSE said the deal was unlikely to be approved by the European Commission. The commission insists that the LSE sell its MTS business which it has declined to do. If the failure of the deal – which would have created Europe’s biggest stock exchange -- is officially confirmed, this will be for the third time after two previous attempts back in 2000 and 2005 – ended in failure.
Sterling was under pressure during the session after reports that Scotland could be about to call a second independence referendum. The Times newspaper reported that the British Prime Minister Teresa May is preparing for another vote. The Scottish public rejected independence by a 10-point margin in a 2014 referendum, but now that Britain is leaving the EU, another vote could be on the cards.
In other news, Persimmon reported solid earnings, which demonstrates that despite post-Brexit woes, Britain’s housing sector is in a good position thanks to a deep supply rut.
And on the continent, Eurozone confidence edged up in February, with positive views from industry and the service sector outweighing weakness among consumers and the retail area.
Europe is now looking ahead to US President Donald Trump’s speech to Congress and hoping for more details on his stimulus package.
