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Welcome to the home for real-time coverage of European equity markets brought to you by Reuters
stocks reporters and anchored today by Julien Ponthus. Reach him on Messenger to share your
thoughts on market moves: julien.ponthus.thomsonreuters.com@reuters.net
ON THE RADAR: THYSSENKRUP, LVMH AND PSA/FCA (0756 GMT)
AS expected, futures are pointing to a lot of red at the open with Germany’s Dax, Europe's
popular gauge of trade war greed and fear, suffering the most.
The Energy sector is also expected to be under pressure with oil prices retreating due to
the trade tensions.
Fears political risk may hinder growth next year was illustrated this morning by French
perfume maker Interparfums blaming geopolitical and economic uncertainties for slowing growth.
While we wait to see if there will be any surprise in the list of companies Labour will seek
to nationalise should it win the Dec 12 election, Royal Mail and Severn Trent, already targeted,
both published trading updates. The first is seen taking a hit while Severn Trent is expected
to rise.
Another big news development for one of Europe’s stock market darlings is French luxury
group LVMH entering due diligence with U.S. jewellery chain Tiffany & Co after raising its bid
to close to $16 billion.
As a blow to investors hoping for a recovery story, Thyssenkrupp scrapped its dividend after
its full-year net loss widened five-fold. Shares are expected to take a 5% hit at the moment.
While the impact (if any) on the Fiat Chrysler Automobiles/PSA planned merger isn’t clear at
this point, news that General Motors filed a racketeering lawsuit against FCA, alleging that
its rival bribed United Auto Workers (UAW) union officials, may possibly scare off some
investors.
Two different outcomes in financial services: CMC Market is seen rising after raising its
guidance while Investec could disappoint with lower profits.
(Julien Ponthus)
*****
BRING ON THE "LABOUR NATIONALISATION HIT LIST"! (0702 GMT)
Labour will unveil its manifesto this morning at 11h00 GMT in Birmingham.
The event will be closely watched by investors after last week's surprise pledge by Jeremy
Corbyn to part-nationalise BT.
"BT hadn’t believed it was on the Labour nationalisation hit list", Neil Wilson, chief
market analyst at Markets.com commented at the time as the pledge took analysts by surprise.
So whether there will be another surprise target for nationalisation is the multi-billion
pound question that on everyone's mind!
Corbyn seeks to reverse privatisations began by former Prime Minister Margaret Thatcher in
the 1980s, promising to nationalise rail, mail, water, and BT's broadband network to provide
free internet for all.
Coincidence? Royal Mail and Severn Trent both publish trading updates this morning.
Anyhow, in a bid to manage readers expectations, it may be important to stress that given
Labour's perceived low chances of being in power post the Dec. 12 election, the "Labour
nationalisation hit list" may not trigger crazy market price action.
See Friday's LIVE MARKETS-BT nationalisation: Who cares?
(Julien Ponthus)
*****
MORNING CALL: DOWN WITH THE FLOW (0624 GMT)
No reason for European stocks to be spared from the global pull-back really.
Wall Street and Asian markets retreated sharply overnight amid fears the very much hoped-for
"phase one" Sino/U.S. trade deal would be delayed due to fresh tensions between Washington and
Beijing.
Financial spreadbetters expect London's FTSE to open 31 points lower, Frankfurt's DAX down
69 points and Paris' CAC to lose 31 points at the open.
"The US-China trade spat has been rumbling on for over one year, and traders are used to the
back and forth", commented David Madden at CMC Markets, adding that the latest twist in the saga
could be seen as "an excuse to unwind some positions".
(Julien Ponthus)
*****
(Reporting by Danilo Masoni, Joice Alves, Julien Ponthus and Thyagaraju Adinarayan)
