Europe open: Stocks in the red; Generali gains but Essentra slumps

European stocks fell on Monday as investors got to grips with the first day of trading since Donald Trump took office, with the dollar under pressure across the board.

At 0845 GMT, the benchmark Stoxx Europe 600 index was down 0.7%, while Germany’s DAX and France’s CAC 40 were 0.9% weaker. Meanwhile, oil prices edged lower, with West Texas Intermediate down 0.7% to $52.85 a barrel and Brent crude off 0.5% to $55.21.

Accendo Markets’ Mike van Dulken pointed out that the dollar has been selling off since Friday, inspired by President Trump’s inauguration speech, in which he adopted “a very nationalist, protectionist rhetoric that risks rocking the globalisation boat and thus spurred safe haven demand.

“The result is unwelcome strength in peer FX majors like GBP, EUR and Yen which hurts sentiment towards exporters, whose goods are that little bit less competitively priced and international profits now worth that little bit less.

“In focus today with a dearth of macro data, will be the continued fallout from Donald Trump’s inauguration speech and the start of his first full week in office. All eyes will be firmly focused on his renegotiation of the North American Free Trade Agreement, due to begin today, as well as desire to ditch Obamacare.”

In corporate news, Italian insurer Generali racked up healthy gains following a report that Intesa Sanpaolo could take a stake in the company, possibly with Germany’s Allianz.

Housebuilder Bovis Homes rallied following a Sunday Times report that one of its larger shareholders has suggested Berkeley Group mount a bid for the company.

Paddy Power Betfair was in the red after saying it would not hit its top-end targets after Donald Trump's unexpected US election win and several other punter-friendly sporting results at the end of the year cost it around £40m. However, the FTSE 100 group said it still expected to make underlying earnings before interest, tax, depreciation and amortisation around the mid-point of its November guidance of £390-405m.

Essentra, a maker of cigarette filters and plastic packaging, tumbled after it warned that it expects profit will be below expectations to a due to a more challenging than previously anticipated Health & Personal Care Packaging unit, which has been experiencing operational issues.

Insurer Admiral was lower as Deutsche Bank cut its stance on the stock to ‘sell’.