European stocks rally on U.S. shutdown optimism; Salzgitter cuts guidance

Investing.com - European stocks surged higher Monday, following the global lead after the U.S. Senate voted in favor of a key step towards ending the country’s  longest ever government shutdown.

The DAX index in Germany gained 1.8%, the CAC 40 in France climbed 1.3% and the FTSE 100 in the U.K. rose 1.1%. 

Sentiment boosted by U.S. shutdown news  

Sentiment received a boost on Sunday with the news that the U.S. Senate voted 60-40 to advance a spending bill for consideration, after eight Democratic senators reached a deal with Republican leaders to potentially reopen the U.S. government. 

The prospect of a potential breakthrough in Congress encouraged investors, as the U.S. economy struggled with its longest ever government shutdown, which entered its 40th day on Sunday.

The shutdown sparked disruptions across the country, especially in key sectors such as air travel, prompting White House economic adviser Kevin Hassett to state in an interview that the U.S. economy, widely seen as the global economy’s main growth driver, could contract in the fourth quarter if the shutdown dragged on.

COP30 summit starts in Brazil  

Elsewhere, the COP30 global climate summit kicks off on Monday in Brazil, with the gathering marking three decades since global climate negotiations began, which eventually resulted in the 1992 U.N. climate treaty. 

The conference could turn out to be highly contentious, especially as the Trump government has decided not to send any high-level officials and has announced its intention to withdraw from the treaty.

Salzgitter cuts full-year guidance  

There are more earnings to digest on Monday as what has been a reasonably healthy quarter gradually winds down.

German steel producer Salzgitter (ETR:SZGG) lowered its full-year guidance for the second time this year, warning that business conditions have remained weak despite recent signs of firmer prices.

Reinsurer Hannover Re (OTC:HVRRY) raised its full-year earnings forecast after reporting a 7.7% increase in group net income for the first nine months of 2025.

Diageo (LON:DGE) has appointed Sir Dave Lewis as its new Chief Executive Officer, effective January 1, 2026, the company announced Monday.

Currently serving as chair of Haleon (LON:HLN), Lewis previously served as Group CEO of Tesco (LON:TSCO) from 2014 to 2020, and spent nearly three decades at Unilever (LON:ULVR) in various executive roles.

Crude edges lower

Oil prices slightly declined Monday despite optimism that the end of the U.S. government shutdown was near, potentially lifting demand in the world’s top oil consumer.

Brent futures fell 0.1% to $63.53 a barrel, and U.S. West Texas Intermediate crude futures declined 0.3% to $59.59 a barrel.

Both contracts fell about 2% last week, recording their second consecutive weekly decline, after the Organization of the Petroleum Exporting Countries and their allies, or OPEC+, agreed to increase output slightly in December, but it also paused further hikes in the first quarter, wary of a supply glut.