LIVE MARKETS-Europe before the bell: Buy the rumour, buy the fact

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EUROPE BEFORE THE BELL: BUY THE RUMOUR, BUY THE FACT

It's all going to be about Germany at the open - an unoriginal thought, but true, after the election left Frederick Merz set to become Germany's next chancellor, and with slightly-less-fraught coalition negotiations ahead than many had feared.

Slightly-less-fraught still means quite fraught of course, but in the short term, markets seem to like it, with blue chip DAX futures up 1%, FDXc1 and mini-MDAX midcap futures up 1.24%. FSMXc1

Both have been performing well this year. The DAX hit an all-time peak early last week, though it did retreat slightly in the days ahead of the vote.

The euro is also around 0.4% higher on the dollar, and up around 0.2% on the pound, EUR=EBS, EURGBP=D3 and safe-haven bond prices are down slightly, leaving the 10-year Bund yield up 2.5 basis points on the day around 2.48%. DE10YT=RR

Merz will have to negotiate with centre-left Social Democrats (SPD) of outgoing Chancellor Olaf Scholz to form a coalition, but the failure by two smaller parties to meet the 5% vote threshold to enter the German parliament, means the two in combination can form a majority and Merz will not need to rely on a third party.

In company news, Dutch technology investor Prosus PRX.AS said on Monday it intends to buy Just Eat Takewaway.com TKWY.AS to create a "European tech champion" of food delivery. Traders are calling Just Eat shares to open up over 50%, and also see a boost for those of rivals.

In other merger news, Italian oil services company Saipem SPMI.MI said on Sunday it will merge with Norwegian rival Subsea 7 SUBC.OL in a deal valued at about $4.63 billion.

(Alun John)