By Sruthi Shankar
(Reuters) -European shares retreated on Monday, after coming close to all-time highs in the previous session on optimism around U.S. monetary policy easing, while shares of JDE Peet’s touched a three-year peak following a buyout deal.
JDE Peet’s surged 17% to its strongest level since September 2022, after Keurig Dr Pepper said it would buy the Dutch coffee company in a 15.7 billion euro ($18.37 billion) deal.
Broader European markets came under pressure following Friday’s surge when U.S. Federal Reserve Chair Jerome Powell pointed to a possible interest rate cut next month, citing rising risks to the job market.
The pan-European STOXX 600 index was down 0.2%, as of 0856 GMT. The German DAX dropped 0.4% and France CAC 40 slid 0.5%. The UK market was closed for a public holiday.
Markets drew little comfort from an Ifo Institute survey that showed German business morale improved unexpectedly in August.
“While financial markets seem to have grown numb to tariff announcements, let’s not forget that their adverse effects on economies will gradually unfold over time,” said Carsten Brzeski, global head of macro at ING.
“…it is hard to see how the export-dependent German economy will be able to get out of seemingly never-ending stagnation in the second half.”
All eyes will be on U.S. tech highflier Nvidia’s quarterly report later this week for signs its AI-fuelled $4 trillion valuation is justified.
Upcoming U.S. and eurozone economic data will also be watched for monetary policy clues.
The European Central Bank is likely to keep interest rates steady next month but discussions about further cuts may well resume in the autumn if the economy weakens, five sources told Reuters.
The ECB left its key rate at 2%, bringing a year-long easing cycle to an end and leading investors to bet on a prolonged pause.
Denmark’s Orsted tumbled 16.3% to a record low after the Trump administration ordered the company to stop far-advanced construction on an offshore wind project near Rhode Island.
Orsted said it would proceed with the planned rights issue despite the order.
Other renewable energy firms including Vestas Wind and Siemens Energy fell 4% and 1.4%, respectively.
Valneva slumped almost 24% after the U.S. drug regulator suspended the French drugmaker’s licence for chikungunya vaccine Ixchiq with immediate effect.
Commerzbank inched up 0.3% after UniCredit said it had increased its voting rights in the German lender to around 26%.
($1 = 0.8545 euros)
(Reporting by Sruthi Shankar in Bengaluru; Editing by Mrigank Dhaniwala and Rashmi Aich)
