Europe open: Stocks nudge higher as investors digest US presidential debate

European stocks nudged higher in early trade, recovering from two downbeat sessions as investors digested the outcome of the first US presidential debate, with Hillary Clinton seen to have come out on top versus her rival Donald Trump.

At 0900 BST, the benchmark Stoxx Europe 600 index was up 0.2%, Germany’s DAX was 0.2% higher and France’s CAC 40 was up 0.1%.

At the same time, oil prices retreated after Iran played down expectations for a deal on oil production, calling the oil producers meeting on Wednesday “consultative” and dashing hopes that an agreement will be made. West Texas Intermediate was down 0.7% at $45.61 a barrel and Brent crude was down 1% at $46.90.

Andy McLevey, head of dealing at Interactive Investor, said: “European markets have opened positively in early trading tracking the recovery in Asia overnight as early online reaction indicates Hillary Clinton fared better in the first televised US presidential debate however markets remain some way off recouping yesterday's heavy losses. The focus on the US election is only going to increase as November's election draws ever nearer and investors will need to focus on what the result may mean for markets in general therefore as the race hots up and the two candidates jockey for position the volatility of late looks set to continue.”

Meanwhile, FXTM chief market strategist Hussein Sayed pointed out that the best financial asset proxy to the US presidential race is the Mexican Peso, which rose by more than 1.5% against the US dollar after declining to a new record low yesterday. “The higher the Mexican currency goes suggests higher probability for Clinton reaching the White House as Trump repeatedly raged against globalisation and free trade agreements.”

In corporate news, Commerzbank was in the black following a report in Handelsblatt suggesting it was planning to cut around 9,000 jobs over the coming years as part of its restructuring plan.

Electrolux was higher after an upgrade by Nordea Bank, while Orange was boosted by an upgrade from Credit Suisse.

In London, Legal & General was little changed as it said that following a strong third quarter, its retirement arm was on track to double new business sales in the full year, with customer demand for bulk annuities and lifetime mortgages seemingly unaffected by the introduction of Solvency II regulation, Brexit uncertainty or lower interest rates.

United Utilities edged higher after saying it expects revenue for the first half of this year to be slightly lower than the same period last year, but underlying operating profit to be marginally higher.

Plumbers merchant Wolseley slumped after announcing job cuts and store closures despite a rise in full-year profits.