(Bloomberg) -- Good morning. Here's what we are watching ahead of the market open in Europe:
Brexit and Trump
Theresa May kicks off a two-week campaign to get a skeptical Parliament to back her Brexit deal. The last thing she needed was another spanner thrown into the works. U.S. President Donald Trump told reporters on Monday that the U.K. may not be able to trade with the U.S. with the deal in its current form, describing what's on the table now as a “great deal for the EU.” Keep an eye on the impact for U.K. stocks, particularly those making a majority of their money in the U.S.
China, Apple and Trump
Trump also said he'll likely push forward with plans to increase tariffs imposed on $200 billion worth of Chinese goods, also indicating he'll slap tariffs on all remaining imports from China should negotiations this week with Chinese leader Xi Jinping fail to yield a deal. Also in the president's firing line is Apple Inc. Trump suggested a 10 percent tariff could be placed on mobile phones, like Apple's iPhones, which are made in China. Watch all trade-hit sectors plus Europe's selection of Apple suppliers for any impact.
READ: Asia Stocks Mixed on Tariff Talk; Bonds Steady: Markets Wrap
Italy's Budget
Relations look to be softening between Italy's populist government and the European Union over the country's budget plans, boosting Italian bonds and stocks on Monday. The government failed to thrash out a new deficit target in late-night talks on Monday but the signs continue to point to a deal eventually being reached, with Italian press this morning reporting a 2.2 percent budget deficit target for 2019 is likely. Continue to keep a close eye on Italian bonds and Italian banks.
Activist Victory
Europe has seen a marked increase the last year or two in investor activism. In the U.S., agitators scored a big victory on Monday as engineering behemoth United Technologies Corp. said it will split itself in three. The company will divide into listed aerospace, elevators and climate-control businesses in a dramatic overhaul that marks a big win for two activists who pushed for change. Keep an eye on any activist targets in Europe for any read-across.
Ghosn Saga
There is little sign that the wrangling between Nissan Motor Co. and Renault SA over their alliance in the wake of Carlos Ghosn's arrest are heading for a conclusion. Keep watching Renault shares as more about the story leaks out and with the auto alliance due to hold a meeting Thursday in Amsterdam, where discussions about how to fill the leadership vacuum created by Ghosn's departure will be held.
To contact the reporter on this story: Sam Unsted in London at sunsted@bloomberg.net
To contact the editors responsible for this story: Beth Mellor at bmellor@bloomberg.net, Phil Serafino
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