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* STOXX 600 down 1.6%
* U.S. stimulus rally fades away
* All eyes on U.S. job data
Welcome to the home for real-time coverage of European equity markets brought to you by Reuters
stocks reporters. You can share your thoughts with Thyagaraju Adinarayan
(thyagaraju.adinarayan@thomsonreuters.com), Joice Alves (joice.alves@thomsonreuters.com) and
Julien Ponthus (julien.ponthus@thomsonreuters.com) in London.
BRACING FOR "GARGOYLESQUE" U.S. JOB DATA (1026 GMT)
You know you're in a heavy news cycle when a 2 trillion U.S. stimulus package is yesterday's
news. Yep, all eyes now are on the U.S. job data to be released at 12h30 GMT.
Just to give you an idea of the uncertainty we're facing, the Reuters poll ranges from
250,000 to 4 million unemployment claims.
The wide range of estimates (...) show that we lack historical references to really
understand the impact of this unique and probably massive crisis hitting the economy wrote
Christopher Dembik, head of macro analysis at Saxo Bank.
"The previous record was just a little under 700,000 in 1982 when the United States was
going through the recession caused by the Fed’s contractionary monetary policy", he writes,
adding we are set for "a number of job destruction we have never experienced in a period of
peace".
AJ Bell investment director Russ Mould makes the point that "a spike in claims across the
border in Canada to nearly one million suggests they could be gargoylesque".
What to make of these numbers?
"If we see a number above 2 million, markets will start clamouring for the next government
or central bank bailout", was the take of Jasper Lawler, Head of Research at LCG.
Here's Saxo Bank's chart on previous unemployment jumps.
(Julien Ponthus)
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OPENING SNAPSHOT: DEEP RECESSION FEARS (0837 GMT)
European bourses open in red territory as the fast-spreading coronavirus and fears of a deep
recession overshadowed optmisim from a record $2 trillion U.S. fiscal stimulus package.
The pan-European STOXX 600 index is down 2% with the oil and gas sector
leading the losses, falling 4%.
German shares were hit by a survey, which showed consumer morale in the country
fell sharply.
In the UK, after posting the biggest two-day percentage gain ever, the blue-chip index
dropped 3%.
In terms of single stocks, quite a few names are down 7-9% including Euronext, Carnival and
Virgin Money. Euronext shares slide after Spain's market regulator had authorized a bid by Swiss
exchange SIX to buy the Madrid stock market operator BME.
ABN Amro shares meanwhile are getting hammered it suffered $200 million clearing loss in
coronavirus turmoil.
On a brighter note, Italy's Leornardo is outperfoming most European shares, up
more than 4%, after the defence group said it is extending its training services.
(Joice Alves)
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ON OUR RADAR: CORONAVIRUS LOCKDOWNS HIT HARD (0742 GMT)
Futures are pointing to losses at the open, bringing the two-day rally to an end as
investors are worried about the upcoming a spike in jobless clasims in the U.S. and devastating
European data on consumer confidence in Germany.
Looking at specific sectors, airlines in the UK - easyJet, IAG-owned
British Airways and Virgin Atlantic - are seeking tax breaks to help the industry survive the
pandemic.
Yesterday, Boris Johnson said the govt was in talks with the aviation industry about how
best to support the sector. Another airline, Norwegian Air asked creditors to forego
payments for 3 months.
In the healthcare space, another company is forming partnership as the world desperate
searches for Covid-19 treatments. Novartis said it is joining forces with life sciences
companies to accelerate the development, manufacture and delivery of vaccines and diagnostics.
In Italy, Eni said it is cutting its capital spending by a quarter this year, and
more next.
(Joice Alves)
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GOODBYE TWO-DAY RALLY (0635 GMT)
What a difference a night can make! Futures are pointing to a open in the red for European
bourses as the two-day global equities rally runs out of steam on a spike in U.S. jobless claim.
Financial spreadbetters at IG expect London's FTSE to open 126 points lower at 5,562,
Frankfurt's DAX to open 167 points lower at 9,707 and Paris' CAC to open 61 points lower at
4,372.
Early today, investors across the region will be watching a series of data coming from the
UK or the euro zone including monthly numbers on retail sales and business/ consumer sentiment.
Meantime, oil prices is suffering on the prospect of rapidly dwindling demand due to
coronavirus travel bans and lockdowns.
(Joice Alves)
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(Reporting by Joice Alves, Julien Ponthus and Thyagaraju Adinarayan)
