European stocks edge down, oil drops as midterm caution prevails
SPY•European stocks edged lower on Monday after Friday’s technology selloff, while Brent crude fell 4.5% to about $108 on hopes for a deal to end the Iran war. Investors were cautious ahead of US midterm elections and a busy week of central bank decisions and earnings.
1. Stocks and oil move lower
Europe’s STOXX 600 fell 0.10% on Monday, while the MSCI world stocks index was roughly unchanged. Brent crude dropped 4.5% to about $108 as Iranian negotiators left talks with Qatari mediators and a draft proposal circulated; a follow-up meeting was possible.
2. Election and earnings focus
Investors looked ahead to Tuesday’s US midterm elections, Apple’s earnings and the latest Federal Reserve and European Central Bank policy decisions. Markets expect US equities could face pressure if Democrats sweep, as investors weigh the risk of higher corporate taxes and tighter AI regulation.
3. Analysts flag risks
BofA’s Sebastian Raedler said expected weakness in euro area purchasing managers’ index data was a drag on his STOXX 600 forecast, and cited concerns about returns on AI investment. Apple will face scrutiny over its holiday-quarter outlook, CEO comments on AI and revamped Siri, and rising memory-chip costs that analysts expect to weigh on quarterly profit growth.
