EU stock markets rise following the mid-term election results; banks are performing strongly in Milan
The blue wave has swept through the US Congress, and President Trump has said he accepts the results. On the Milan Stock Exchange, Intesa shares are rising following record quarterly results. The euro is back above 1.12 dollars
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(Il Sole 24 Ore Radiocor) - European stock markets European stock markets are on the rise, as they await the final tally of votes from the US mid-term elections, which are already signalling a landslide victory for the Democrats. President Donald Trump, speaking to the New York Times, said he would ‘accept those results’, adding: ‘We will cooperate with the Democrats and, in short, we look forward to working with them. We’ll probably reach an agreement’. Market concerns centre on fiscal policy and the possibility of a less favourable climate for artificial intelligence and greater rigidity in the authorisations to be granted during the build-up of AI infrastructure, which the Democrats could slow down.
On the macroeconomic front, European inflation figures and PMI indices are due to be released. Meanwhile, the quarterly results season is in full swing. Consequently, the FTSE MIB in Milan is trading positively, buoyed by banking shares; further behind, but still rising, is the CAC 40 in Paris, the DAX 40 in Frankfurt and the other stock markets across Europe.
Banks up in Milan, Ferrari down
On the Milan Stock Exchange, the banking sector is performing strongly, with Unicredit and Intesa Sanpaolo leading the way: the bank led by Carlo Messina released the results of a record quarter the day before and raised its guidance for 2026. Finecobank and Bca Pop Sondrio. Technology shares are also up, with Stmicroelectronics and Technoprobe , whilst the defence sector slips with Leonardo , Avio and Fincantieri . Selling pressure was also seen on Ferrari following the previous day’s rally in response to better-than-expected results and the upward revision of targets for the current financial year.
The dollar weakens; crude oil and gas prices rise
On the currency front, the dollar is weakening following the Democrats’ victory in the US Congress: the euro/dollar exchange rate has thus returned above the 1.12 mark. “A prolonged budget deadlock would dampen expectations of further US fiscal expansion, which would weigh on US bond yields and the dollar,” comments Lin Li of MUFG Bank. On the energy front, oil is up slightly, with Brent at around $104 a barrel, whilst WTI is trading at around $96. Gas is also rising, trading at around 92 euros per MWh.
Spreads falling; 10-year yields also down
Government bonds performed well on the secondary market following the outcome of the US mid-term elections. Whilst across the Atlantic the 10-year Treasury yield failed to fall below the 4.90 per cent mark as vote projections came in, in Europe the 10-year BTP, maturing on 1 October 2036, showed a slight fall in yield to 4.42% compared with 4.44% at the previous day’s close. The spread over the German Bund narrowed to 111 points from 114 in the previous reference. There was also relief for French OATs, which fell back to 4.90 per cent, representing a spread of 159 points over the Bund.
