* Europe's STOXX 600 up 0.2% as defensive stocks gains
* Investec falls after profit warning
* London lags as sterling bounces on renewed Brexit optimism
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*Welcome to the home for real-time coverage of European equity markets brought to you by Reutersstocks reporters and anchored today by Josephine Mason. Reach her on Messenger to share yourthoughts on market moves: josephine.mason.thomsonreuters.com@reuters.net
OPENING SNAPSHOT: DEFENSIVE GAINS (0739 GMT)
Early selling in euro-zone bourses is easing now, helping Paris, Milan, Madrid and Frankfurtoff their earlier lows and almost lift the euro-zone STOXXE benchmark into positiveterritory as cautious investors buy into defensive stocks even as concerns linger about thehealth of the bloc's economy and U.S.-China trade talks.
Real estate stocks that benefit from lower interest rates and healthcare, utilities andretailers are leading the gains.
London's lagging the broader region, down 0.3% as major exporter stocks fall due to thestronger sterling amid fresh hopes the country can avoid a hard Brexit while Rolls Roycetumbles after the company delayed again its Trent 1000 engine. In contrast, optimism aboutBrexit and the stronger domestic currency are boosting housebuilders and supermarkets.
Among individual moves, a profit warning from Investec has pushed the FTSE250-listed investment bank down 5.1% and Signify is sliding 6% after Philips announcedplans to sell its remaining stake in the world's biggest maker of lights.
(Josephine Mason)
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LONDON ON THE BACKFOOT (0700 GMT)
The major European stock futures are on the backfoot this morning as investors lock inprofits amid broader caution about US-China trade talks, government stimulus and spikes inovernight lending rates in the United States.
London futures are leading the charge lower, down 0.7% after sterling rallied to atwo-month high as hopes the country will avoid a no-deal Brexit build again after EuropeanCommission President Jean-Claude Juncker said a new Brexit deal could still be reached beforethe Oct. 31 deadline and the backstop could be potentially replaced.
Brace for volatility with the expiry of contracts for stock index futures, stock indexoptions, stock options, and single stock futures, known as quadruple witching day.
In corporate news, Rolls Royce shares are expected to come under pressure after thecompany warned of further delays its Trent 1000 engines.
Among the midcaps, shares in Investec could fall as much as 10% after theinvestment bank warned that profits for the first-half of the year will be lower than last yearon higher costs as it restructures its business and grapples with "challenging" marketconditions.
Thomas Cook is facing fresh uncertainty after its banks ordered the world's old touroperator company to find an additional 200 million pounds ($251 million) of funding in order toguarantee its survival.
Other UK headlines:
Rolls Royce says it's facing another delay to its Trent 1000 engine
Royal Bank of Scotland appoints Alison Rose as CEO
Thomas Cook confirms lenders' request for extra 200 mln stg in rescue deal
Keller CEO Michaelis to step down, reaffirms FY outlook nL3N26B1ME
Rolls-Royce Delays Single-Digit Level Return Of AOGS On Trent 1000
(Josephine Mason)
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ON OUR RADAR: SUPERMARKETS, AIRLINES (0558 GMT)
It's relatively quiet on the corporate front, but supermarkets and airlines are catching afew early headlines.
Casino is in talks to sell its French discount store chain Leader Price to Germanlow-cost rival Aldi, the latest move by the French retailer to cut debts.
There are more ructions in the airline and travel sector: French budget airline XL Airwayshas become the latest example of low-cost airlines running into financial trouble amid sectorovercapacity as it suspended ticket sales and.
Meanwhile a rescue deal for Thomas Cook is facing fresh uncertainty after the travelfirm was hit with a demand for extra funds and a panel of bankers delayed a decision that mighthave won credit investors over to a deal.
Here are your early headlines:
Thomas Cook hit with extra funding demand, threatening rescue
Mediaset strikes deal to fend off Vivendi's withdrawal risk
Philips to sell remaining 10.7% stake in Signify for 357 mln euros
Belgian police search home of new KPN CEO - reports
France's CNP and Brazil's Caixa seal $1.7 bln insurance deal
Casino in talks to sell discount chain Leader Price to Aldi
Air France and easyJet drop Aigle Azur bids as liquidation looms
(Josephine Mason)
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ENDING A 'STRANGE' WEEK (0521 GMT)
If it stays under pressure today, the euro-zone STOXXE benchmark will register itsfirst weekly drop in five reflecting the disquiet from the drone attacks on Saudi Arabia, tradetensions, central bank stimulus and the spikes in overnight lending rates that roiled bondsmarkets and briefly derailed the rally in banking stocks.
The pan European STOXX 600 is proving a little more robust, on track for a 1.2%rise, its fourth straight weekly gain.
As Michael Hewson, chief market analyst at CMC Markets UK says: "It's been a bit of astrange week for equity markets."
The lack of any escalation (in Saudi Arabia) so far appears to have tempered a goodproportion of this week’s surge higher, in the oil price, prompting equity markets to recoverfrom their lows, nonetheless there remains a significant amount of unease as to what mightunfold over the course of the next few days and weeks."
"As a result of this uncertainty equity markets have struggled to push on significantly fromthe gains, we’ve seen over the course of the previous three weeks, with US markets struggling topush on beyond their previous record highs from July."
IG financial spreadbetters expect London's FTSE to open 30 points lower at 7,327,Frankfurt's DAX to open 21 points lower at 12,437, and Paris' CAC to open 10 points lower at5,649.
(Josephine Mason)
*****(Reporting by Danilo Masoni, Josephine Mason and Thyagaraju Adinarayan)