European stock markets opened slightly higher on Monday, reversing some of last week’s losses as select corporate stories helped offset a gloomy geopolitical backdrop.
As of 0706 GMT, the pan-European STOXX 600 index rose 0.2% to 545.87 points, signaling a fragile but positive start to the trading week amid escalating tensions in the Middle East.
Key Corporate Movers: Kering Soars, Renault Slides
The standout performer was Kering SA, the French luxury conglomerate and parent of Gucci, which jumped 7.2% after reports suggested that Luca de Meo, the turnaround architect of Renault, is likely to become its next CEO.
The market interpreted the possible appointment as a major strategic win for Kering, which has been struggling to reignite growth at Gucci amid slowing demand from China and a cooling luxury market in Europe.
In contrast, Renault shares tumbled 5.6%, hit by investor concerns about losing a proven leader and a separate development where Nissan is reportedly planning to reduce its stake in the French automaker. The move marks a potential shift in one of the auto industry’s longest-standing alliances.
Geopolitical Tensions Remain in Focus
Meanwhile, geopolitical developments in the Middle East continued to weigh on sentiment.
Iranian missile strikes on Tel Aviv and Haifa in the early hours of Monday escalated fears of a broader regional conflict, building on a cycle of retaliatory attacks that began last week.
Markets remain cautious, with geopolitical risk now priced in alongside concerns over evolving US tariff policies, particularly those targeting Chinese electric vehicles and clean energy products.
Sector Watch: Energy, Travel and Leisure in the Green
The energy sector was among the session’s best performers, up 1.1%, as oil prices edged higher in reaction to the increased tensions in the Middle East — home to some of the world’s most critical oil transit routes.
The travel and leisure sector also posted a 1% gain, partly recovering from last week’s risk-off sentiment.
Entain, the owner of Ladbrokes, surged 5.2% after its US sports-betting joint venture with MGM Resorts, BetMGM, raised its full-year revenue and earnings guidance. The upbeat forecast suggests sustained demand in the high-growth US digital gaming market despite economic headwinds.
Broader Market Outlook: A Cautious Balance
While today’s uptick suggests some confidence returning to the European bourses, volatility remains elevated as traders weigh corporate fundamentals against geopolitical uncertainty.
Investor focus this week will likely remain on:
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Central bank commentary from the ECB and the Fed
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Any further developments in the Israel-Iran conflict
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Key economic data out of the eurozone and the US
With luxury stocks, energy, and travel providing a degree of insulation, the STOXX 600 may hold its ground, but any surprise escalation or adverse policy signal could trigger renewed selling.