US markets were closed for the Labor Day public holiday on Monday, giving investors a pause after last week’s rally. With Wall Street on hold, attention shifted to Europe, where stocks opened September on a stronger footing.
European markets start higher
The pan-European Stoxx index edged higher, led by gains in defense and health care. The Stoxx Aerospace and Defense index climbed 2.2% after the U.K. government announced its largest-ever warship export deal by value. Norway has ordered £10 billion, or about US$13.5 billion, worth of British-made Type 26 frigates, a contract that will support around 4,000 jobs into the 2030s.
Health care boost from Novo Nordisk
Danish drugmaker Novo Nordisk also provided momentum, with shares up 1.8%. The company reported clinical trial results showing that its weight-loss treatment Wegovy significantly reduces cardiovascular risks compared with Eli Lilly’s rival drugs Zepbound and Mounjaro. Patients continuing on semaglutide, the active ingredient in Wegovy, saw up to a 57% greater reduction in heart attack, stroke, or death than those on tirzepatide. Despite the positive trial outcome, Denmark last week cut its 2024 growth forecast, citing weaker US sales for Novo and pressures from tariffs and generic competition.
Asia mixed as China data improves slightly
In Asia, markets were mixed. China’s manufacturing activity showed slight improvement, with the private-sector “RatingDog” index at 50.5, up from 49.5, while the official PMI remained in contraction at 49.4. Investors are also watching political signals, after India and China described themselves as development partners at a regional security summit.
Australian outlook and commodities
Closer to home, Australian shares are set for a soft open, with futures down 7 points or 0.1% to 8,887. A heavy data week begins with second-quarter current account and export figures at 11:30 a.m. AEST.
In commodities, silver surged above US$40 an ounce for the first time in 14 years. Gold added 0.8% to US$3,476 an ounce, while Brent crude rose 1% to US$68.15 a barrel. Iron ore slipped 1.8% to US$101.65 a tonne. Currencies were steady, with the Australian dollar at 65.52 U.S. cents, while bitcoin traded at about US$109,000. Bond yields showed little movement, with U.S. 10-years at 4.23% and Australian equivalents at 4.31%.
