Brent tops $97 as German politics, yields pressure European stocks
European stocks ended near flat while Brent climbed above $97, German Bund yields rose and Germany’s AfD won a major state-level vote, deepening political uncertainty.
While American markets were closed for Labor Day, European equities ground to a near-flat close on Monday, masking a surge of political uncertainty underneath. In Germany, the AfD obtained a landslide victory in Saxony-Anhalt, marking the first political win for a far-right party since the Second World War. The AfD took roughly 44% of the vote — its first major state-level win — falling short of an absolute majority but handing Chancellor Friedrich Merz's CDU its worst-ever result in the state since reunification. 3951% set last week.
18%. 85%. The geopolitical picture remains complicated. Brent crude climbed above $97 on fresh US-Iran tanker strikes.
The US struck three Iranian oil tankers over the weekend, destroying one, and Tehran responded by threatening a new restricted zone outside the Strait of Hormuz, warning that ships face strike risk near Oman's Khasab. The Financial Times reported a Saudi Aramco facility was hit in fresh strikes. 4%. 63.
63 a pound. 30. The energy squeeze is no longer confined to oil. 8% on the month.
3% in August against a 2% target. Traders are pricing roughly a 90% probability of another hike by year-end. Markets are also leaning toward a Federal Reserve hike after August nonfarm payrolls came in at 162,000 against expectations near 56,000, with Friday's US CPI the week's decisive print. 50, the best performer in the DAX, as strong signals from South Korean memory-chip makers rippled through the sector following the launch of OpenAI's GPT-6 Astra model.
3% and STMicroelectronics NV (NYSE: STM ) rose 4% on the same AI enthusiasm. The AI-electrification trade travelled with it. 4%. Energy was the other winner as crude pushed higher.
5%, helped both by oil and by news. 3%. In healthcare, Novartis AG (NYSE: NVS ) fell more than 3% after its cholesterol drug failed to meet expectations in a closely watched study. 9% one of the heaviest drags on the German index given its weighting, consistent with rate-sensitive software de-rating as yields climbed.
S. m. ET. Attention then turns to Thursday's ECB decision and Friday's US CPI report, with Treasury auctions through the week testing demand at multi-year-high yields.