German Political Uncertainty Impacts European Markets

On Monday, major European stock markets experienced a downturn following the collapse of the German government as Chancellor Olaf Scholz lost the vote of no confidence. This political upheaval has led to the scheduling of snap federal elections in Germany, the largest economy within the European Union. Simultaneously, economic indicators from the Eurozone and the United Kingdom painted a lukewarm picture for December, with private sector activity showing only modest growth.

In the wake of these events, the DAX index declined by 0.45%, with Vonovia SE seeing a significant 4.12% drop. The FTSE 100 fell by 0.49%, impacted by a 6.36% plunge in Entain PLC's shares. The CAC 40 decreased by 0.74%, with Vivendi SA experiencing a dramatic 68.58% nose-dive. Meanwhile, the Eurostoxx 50 went down by 0.41%, with Stellantis NV losing 4.50% by 5:35 pm CET.

Currency markets were also affected, with the euro holding steady against the dollar at $1.04975 at 5:28 pm CET. Conversely, the pound sterling showed resilience, rising by 0.53% against the U.S. currency to trade at $1.26852.