European markets choppy; sterling slumps against the dollar

Elliot Smith and Holly Ellyatt

European stocks were choppy on Monday as investors continued to weigh the deteriorating economic outlook in the region.

TICKER	COMPANY	NAME	PRICE	CHANGE	%CHANGE	VOLUME
.FTSE	FTSE 100	*FTSE	7034.53	15.93	0.23	24039583
.GDAXI	DAX	*DAX	12284.19	0	0	0
.FCHI	CAC 40 Index	CAC	5780.04	-3.37	-0.06	4190930
.FTMIB	FTSE MIB	*FTSE MIB	21051.39	-15.16	-0.07	12529459
.AEX	AEX Amsterdam Index	AEX	641.04	1.76	0.28	5074491
.IBEX	IBEX 35 Idx	*IBEX 35	7546.6	-36.9	-0.49	6187179

The pan-European Stoxx 600 dipped 0.3% in early trade, with retail stocks shedding 1.8% to lead losses while tech stocks gained 0.7%.

Concern for the global growth outlook has been increasing as inflation remains high and central banks resort to aggressive interest rate hikes to try to tame rising prices.

Shares in Asia-Pacific fell sharply on Monday as negative sentiment continues to weigh in on markets.

The British pound plunged to a record low on Monday, following last week’s announcement by the new U.K. government that it would implement tax cuts and investment incentives to boost growth. Britain’s internationally-focused FTSE 100 climbed in early trade on Monday amid the currency’s decline.

Investors in Europe are also watching Italy following a snap election on Sunday. The country is on course to elect its first female prime minister and the first government led by the far-right since the end of World War II.

Giorgia Meloni and her far-right Brothers of Italy party top vote in Italian elections, exit poll shows

Italians are on course to elect the country’s first female prime minister and the first government led by the far-right since the end of World War II.

Giorgia Meloni’s Fratelli d’Italia (Brothers of Italy) party are set to gain 26.4% of the vote, according to an exit poll early Monday morning. The party is in a broad right-wing coalition with Lega, under Matteo Salvini, Silvio Berlusconi’s Forza Italia and a more minor coalition partner, Noi Moderati.

This alliance is set to win 44.43% of the vote, according to exit polls, enough to gain a parliamentary majority with the center-left bloc on 26.57%. Early projections from the actual election results are due Monday morning.

Sterling hits record low against the dollar, as Asia-Pacific currencies also weaken

The British pound plunged to a record low on Monday morning in Asia, following last week’s announcement by the new U.K. government that it would implement tax cuts and investment incentives to boost growth. The sterling briefly fell 4% to an all-time low of $1.0382 on Monday in Asia.

Critics say those economic measures will disproportionately benefit the wealthy and could see the U.K. take on high levels of debt at a time of rising interest rates.

— Abigail Ng

CNBC Pro: Morningstar reveals its top high-dividend global stocks — and gives three 30% upside

Morningstar has revealed its pick of global stocks with the highest dividend yields, saying they stand out in an environment where many companies may not be able to maintain their dividends due to “economic strain.”

— Ganesh Rao

CNBC Pro: Dan Niles predicts when the S&P 500 might bottom, and reveals how he’s profited this year

Hedge fund manager Dan Niles has revealed his outlook for the S&P 500 after the Federal Reserve hiked rates by 75 basis points for the third consecutive time.

He shared the level he expects the S&P 500 to fall to, and stressed that “nothing that is safe” for investors right now.

— Ganesh Rao

Stocks prepare to test their lows in the final week of trading for September

Heading into the final week of trading for September, the Dow and S&P 500 are each down about 6% for the month, while the Nasdaq has lost 8%.

Both the Dow and S&P are now sitting 1.2% and 1.6%, respectively, above their lows from mid-June. The Nasdaq is 2.9% above its low.

S&P 500 year-to-date

— Tanaya Macheel

European markets: Here are the opening calls

European stocks are expected to open in negative territory on Wednesday as investors react to the latest U.S. inflation data.

The U.K.’s FTSE index is expected to open 47 points lower at 7,341, Germany’s DAX 86 points lower at 13,106, France’s CAC 40 down 28 points and Italy’s FTSE MIB 132 points lower at 22,010, according to data from IG.

Global markets have pulled back following a higher-than-expected U.S. consumer price index report for August which showed prices rose by 0.1% for the month and 8.3% annually in August, the Bureau of Labor Statistics reported Tuesday, defying economist expectations that headline inflation would fall 0.1% month-on-month.

Core CPI, which excludes volatile food and energy costs, climbed 0.6% from July and 6.3% from August 2021.

U.K. inflation figures for August are due and euro zone industrial production for July will be published.

— Holly Ellyatt

Source : CNBC