European markets faced headwinds as France's CAC 40 dropped 1.4% and the EUR/USD weakened following PM Lecornu's resignation, exacerbating political instability, while Citigroup downgraded UK equities to "underweight" amid persistent contraction in UK construction. Corporate news reflected mixed trends, with Aston Martin cutting its 2025 volume outlook and Mondi issuing a profit warning due to weak demand, though AstraZeneca reported a significant survival benefit for its Datroway drug in a breast cancer trial and Shawbrook Group announced plans for a London IPO.
AMD shares surge after AI chip deal with OpenAI Investing.com -- British stocks edged lower on Monday, mirroring the broader European markets, although France’s CAC 40 lagged behind, declining following Prime Minister Sebastien Lecornu’s sudden resignation. The blue-chip index FTSE 100 fell 0.2% and the British GBP/USD dropped 0.1% against the dollar to around 1.3470. DAX index in Germany gained 0.1%, the CAC 40 in France dropped 1.4%. France faces fresh political turmoil as PM Lecornu resigns Lecornu stepped down from his position just one day after announcing his new cabinet. The resignation came as both political allies and opponents threatened to overthrow his government within hours of the cabinet appointments. The political turmoil adds to France’s ongoing governmental instability. Lecornu, a close associate of President Emmanuel Macron, had only been appointed to the prime minister role last month. In response to the political developments, France’s CAC 40 index dropped sharply. The EUR/USD also weakened following the news, reflecting investor concerns about political stability in one of Europe’s largest economies. U.K. construction activity falls at slower pace UK construction activity remained in decline during September, though the pace of contraction eased to its slowest in three months, according to data released by S&P Global’s UK Construction Purchasing Managers’ Index (PMI). The index rose to 46.2 in September from 45.5 in August, reaching its highest reading since June. However, it stayed below the 50.0 mark that separates growth from contraction for a ninth consecutive month, signaling that the sector continues to face challenging conditions. Citi downgrades U.K. stocks to Underweight Citigroup has sharply reduced its rating on U.K. equities to “underweight” from “overweight,” citing a less supportive outlook for the FTSE 100 as market conditions begin to broaden. In a note published Friday and reported by Reuters, the bank projected the FTSE 100 to reach 9,300 by the end of 2025 and 9,700 by mid-2026, suggesting only limited upside from current levels. Aston Martin cuts 2025 volume outlook on weaker demand Aston Martin Lagonda Global Holdings PLC (BS:AMLl) has reduced its 2025 volume forecast, now expecting a mid-to-high single-digit percentage decline compared to 2024 levels due to weakening demand in North America and Asia-Pacific regions along with ongoing tariff pressures. The British luxury automaker delivered approximately 1,430 wholesale units in the third quarter of 2025, falling short of both the 1,641 units delivered in the same period last year and its previous guidance that volumes would remain broadly similar. Mondi issues profit warning as weak demand hits 3Q results In other corporate news, Mondi PLC (LON:MNDI) issued a profit warning after reporting weaker-than-expected third quarter results. The paper and packaging company posted quarterly EBITDA of €223 million, down from €274 million in the second quarter. Excluding a €20 million forest fair value gain, EBITDA was €203 million, 15% below analyst expectations. Mondi attributed the disappointing performance to weak demand, which led to extended maintenance shutdowns in softer markets. While packaging segments remained relatively stable compared to the second quarter, the uncoated fine paper business showed significant weakness, with challenging market conditions expected to persist through year-end. Ferrexpo lifts Q3 output Meanwhile, Ferrexpo PLC (LON:FXPO) reported third-quarter production of 1.51 million tonnes, representing a 3.3% increase from the second quarter but 29% lower than first-quarter levels. The iron ore producer has scaled back operations to just one pellet line due to ongoing suspension of VAT refunds by Ukrainian tax authorities, with withheld funds now totaling $47 million. AstraZeneca drug delivers survival benefit in breast cancer trial In pharmaceutical news, AstraZeneca PLC (ST:AZN) and Daiichi Sankyo’s Datroway has shown a statistically significant improvement in overall survival for patients with metastatic triple-negative breast cancer who cannot receive immunotherapy. The TROPION-Breast02 Phase III trial demonstrated the drug improved both overall survival and progression-free survival compared to chemotherapy as a first-line treatment, marking the first time any therapy has shown a survival benefit in this specific patient population. Shawbrook Group plans London IPO Shawbrook Group, a UK digital banking platform, announced Monday its intention to proceed with an initial public offering on the London Stock Exchange’s Main Market. The high-growth lender, which has expanded its loan book from £1.4 billion in 2013 to £17.0 billion as of June 2025, plans to issue new shares alongside existing shares sold by current owner Marlin Bidco Limited. Should you invest $2,000 in AZN right now? With AZN making headlines, savvy investors are asking: Is it truly valued fairly? In a market full of overpriced darlings, identifying true value can be challenging. InvestingPro's advanced AI algorithms have analyzed AZN alongside thousands of other stocks to uncover hidden gems. These undervalued stocks, potentially including AZN, could offer substantial returns as the market corrects. In 2025 alone, our AI identified several undervalued stocks that later surged by 50% or more. Is AZN poised for similar growth? Don't miss the opportunity to find out. European markets are exhibiting divergence driven by significant country-specific factors. France's CAC 40 index underperformed with a 1.4% drop, directly linked to heightened political instability following the prime minister's resignation, which also weakened the EUR/USD. The UK market faces a challenging outlook, underscored by Citigroup's downgrade of UK equities to "underweight" with a forecast of limited upside for the FTSE 100. This bearish sentiment is supported by weak underlying economic data, as the UK's construction PMI for September, at 46.2, marked a ninth consecutive month of contraction despite a slight easing in the pace of decline. Corporate news reinforces this cautious tone, with Aston Martin (AMLl) cutting its 2025 volume forecast on weakening international demand and Mondi (MNDI) issuing a profit warning after its Q3 underlying EBITDA fell 15% below consensus due to soft market conditions. Adding to the risk-off environment, Ferrexpo (FXPO) continues to operate with severely scaled-back production due to a $47 million VAT refund dispute with Ukrainian authorities, highlighting significant geopolitical risk. In contrast, positive idiosyncratic stories are emerging, most notably AstraZeneca (AZN), which reported a statistically significant overall survival benefit for its drug Datroway in a Phase III breast cancer trial. Additionally, the planned London IPO of high-growth digital lender Shawbrook Group, which expanded its loan book to £17.0 billion, indicates that investor appetite for specific growth assets persists despite the broader market headwinds.
AI-powered research, real-time alerts, and portfolio analytics for institutional investors.
Request a DemoOverall Sentiment
moderately negative
Sentiment Score
-0.30
Ticker Sentiment
