European stocks open higher; ARM rallies 45% after Softbank bid 

European stocks traded higher led by a rally in ARM shares after Softbank tabled a $32 billion offer for the U.K. semiconductor giant and as investors digest a number of geopolitical events including the failed coup in Turkey.

The pan-European STOXX 600 was up 0.68 percent.

Softbank announced Monday that it would pay £17 per sharefor ARM, a 43 percent premium on Friday’s closing price, in an all-cash deal. Shares of ARM rallied over 46 percent. Other chipmakers including Dialog Semiconductor and Austria Microsystems were trading higher.

As well as the major corporate news, investors are also digesting the geopolitical scene as some stability returned to southeastern Europe after an unsuccessful coup against Turkish President Recep Tayyip Erdogan late on Friday.

The attempted coup sent the Turkish lira tumbling against the dollar and the euro.

Turkey widened a crackdown on suspected supporters of the coup on Sunday, taking the number of people rounded up in the armed forces and judiciary to 6,000, Reuters reported.

In other news, France will begin a third day of mourning on Monday for the victims of the Bastille Day attack in Nice that killed 84 people. More details have emerged about the killer Mohamed Lahouaiej Bouhlel, who was reportedly linked to the militant group Islamic State.

Tensions are also running high in the U.S. after three police officers were shot dead in Baton Rouge by a gunman in an ambush-style assault on Sunday. President Barack Obama condemned the killings and called for a measured response ahead of the party conventions.

On Monday, foreign ministers are due to meet in Brussels under a cloud of geopolitical tension. New British Foreign Minister Boris Johnson will face his European counterparts for the first time in his new role, and following the Brexit vote, for which he was a key campaigner.

Miners fall

The basic resource sector underperformed the broader market as a stronger dollar weighed on metal prices and brokers cut their outlook on a number of stocks.

Credit Suisse cut its outlook on Glencore from “outperform” to “neutral” but raised its price target for the stock along with Anglo American, Rio Tinto and BHP Billiton. All of theses stocks were trading in negative territory.

Elsewhere, the banks were once again in focus. Banca Monte dei Paschi di Siena was trading lower after Moody’s downgraded the bank’s subordinated ratings and estimated a 2-5 billion euro capital shortfall at the troubled Italian lender.

Spain’s BBVA was trading lower after Credit Suisse cut its price target for the stock.

Source: CNBC

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