European markets are expected to open in the red Friday, pulling back from the previous day’s gains, as investors digest the latest in political and economic news coming from the region.
On the bourses front, the U.K.’s FTSE 100 is expected to open 17 points lower at 7,583, while the German DAX is set to open 18 points down at 13,085 and the French CAC off 11 points at 5,370, according to IG.
Trading is set to be light across the continent in the last session ahead of the Christmas holiday. The FTSE 100 is due to close at 12:30 p.m. with other European bourses closing shortly afterwards.
In Europe’s previous session, markets finished the trading day on a positive note, as investors reacted to news that U.S. Congress had approved an overhaul of the U.S. tax code that looks to cut corporate tax rates.
Following the vote, a number of U.S. companies pledged to spend the savings on higher wages and new construction, providing a boost to markets on Wall Street and overseas.
Meantime, politics is set to shake up sentiment on Europe’s final trading day before the Christmas holidays.
In Spain, election results were front and center, after Catalonia’s separatists appeared set to regain power in the Spanish region, following local elections which took place Thursday. Following the news, the euro slipped against a number of currencies, including the U.S. dollar and British pound.
According to Reuters, Catalan leader Carles Puigdemont announced Friday that the absolute majority win by the separatists was a victory of the “Catalan republic” over the Spanish state. Following the independence vote earlier this year, the news is set to continue to shake up the nation’s political crisis between Catalonia, Spain and the euro zone.
Elsewhere, in stocks news, pharmaceutical company Roche and Ignyta announced Friday before the opening bell, that they had entered into a definitive merger agreement for Roche to fully acquire the biotech firm, for a price of $27.00 per share. Consequently investors will be paying close attention to market reaction surrounding the news at the open.
Looking overseas, investors will be digesting news that the House of Representatives voted Thursday to advance a short-term spending bill in order to fund the government through until mid-January.
Meantime, gross domestic product growth rate data for the U.K. is scheduled to come out in early morning trade.
No earnings are set to be published on Friday.
Source: cnbc
Europe seen opening lower in shortened session, Catalan separatists win election