LONDON — European stocks closed slightly higher on Tuesday, with mining stocks leading gains as industry giant Anglo American unveiled a merger with Canada’s Teck Resources.
The pan-European Stoxx 600 provisionally closed 0.09% higher after a choppy end to the session. France’s CAC 40 index rose 0.2% while French bond yields ticked upward but remained off recent highs after the ousting of Prime Minister Francois Bayrou on Monday, a move widely expected by markets.
Losing the confidence vote means French President Emmanuel Macron will now have to appoint France’s fifth prime minister in less than two years. Macron is seen as likely to choose another centrist ally to lead a minority government.
‘Merger of equals’
London-listed shares of Anglo American jumped 9% after it was announced that the firm had agreed to merge with Toronto-listed Teck Resources to create one of the world’s top five copper producers. Teck Resources shares traded in Frankfurt closed 14.3% higher.
The new company, which will be called Anglo Teck, will be headquartered in Canada and is expected to be listed on exchanges in New York, Toronto, London, and Johannesburg.
Under the deal terms, Anglo American shareholders will own 62.4% of the combined entity, with Teck shareholders getting the remaining 37.6%.
“Anglo American and Teck believe that the formation of Anglo Teck in a merger of equals will provide exceptional and enduring benefits for Canada, including establishing a global critical minerals champion headquartered in Canada, bringing strengthened Canadian leadership in critical minerals on the world stage,” the companies said in a joint statement.
Elsewhere, Unilever elaborated on the planned demerger of its Magnum ice cream brand on Tuesday.
Shares of The Magnum Ice Cream Company (TMICC) are expected to float in Amsterdam, London and New York in mid-November this year, with Unilever retaining a minority stake in the firm. Over time, that stake will be wound down.
In a presentation at its Capital Markets Day on Tuesday, Unilever said TMICC would be the largest ice cream company in the world, with 21% of global retail market share. From 2026 onward, the company said it expected TMICC’s medium-term organic sales growth to hit 3% to 5% annually.
Unilever shares closed 1.77% lower.
Asia-Pacific markets traded mostly higher Tuesday, while U.S. stocks were little-changed after the Nasdaq Composite hit a new record on Monday.
Investors stateside are keeping a close eye on inflation reports this week: the U.S. producer price index report for August is due on Wednesday morning, followed by the consumer price index on Thursday.
The inflation prints will be coming after weaker-than-expected hiring data on Friday, which helped fuel investor hope that the U.S. Federal Reserve is likely to lower benchmark interest rates at its policy meeting next week.
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