Peter Nurse 

Investing.com – European stock markets will open lower on Monday due to cautious trading in the beginning of a holiday-shortened work week. Investors are digesting French political uncertainty and the upcoming ECB policy setting meeting, as well as ongoing conflict with Ukraine.

The contract in Germany was 0.3% less at 2:05 AM ET (605 GMT) and in France 0.4% lower at 0.4%. In the U.K, the contract fell 0.2%.

Sunday was the final round of the. Emmanuel Macron (France’s leader) and Marine Le Pen (far-right challenger) qualified for the runoff election on April 24, respectively. 

An unexpected victory for Le Pen could set off shockwaves throughout Europe, given her anti European Union stance. According to opinion polls, the race for the second round is very close with Macron leading but Macron within the margin of error.

Investors will look for direction on future monetary policies at the European Central Bank’s latest meeting, which is scheduled to take place Thursday. The Eurozone has a record 7.5% annual growth rate and shows no sign of peaking.

Policymakers will be reluctant to tighten policy amid uncertainty over the impact of the war in Ukraine on the bloc’s economy, but the more hawkish members of the ECB’s governing council will continue to push for interest rate hikes this year.

Meanwhile, war in Ukraine has continued, with the Austrian-born Chancellor Karl Nehammer scheduled to meet Russian President Vladimir Putin on Monday. The meeting would mark the first time the Russian leader has met with an EU counterpart since ordering the invasion of Ukraine late February.

U.K. growth was moderated by 0.1% gain in February, which is a decrease from the 0.8% rise seen the previous months. 

In corporate news, the German car industry is likely to be in the spotlight after BMW’s (DE:) CEO Oliver Zipse said, in an interview with newspaper Neue Zürcher Zeitung published on Monday, that a shortage of semiconductors is likely to remain a problem for the industry into 2023.

Oil prices fell Monday, continuing recent weakness as China’s lockdowns continue as it worsens, weighing on demand from the world’s largest crude importer.

Shanghai recorded more than 26,000 COVID new cases Sunday. This is a record that shows the difficulties the country faces in stopping the spread.

China’s COVID Zero strategy is being defended, but there are no clear indications of when or how this economic important region will be freed from these restrictions. 

At 2:05 AM ET futures had fallen 1.8% to $96.47/barrel while contract prices fell 1.7% at $101.04. Last week was the second consecutive loss week for both benchmarks.

The price fell 0.2% to $1941.10/oz and traded 0.1% lower at 1.0888.