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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@tr.com), Joice Alves (joice.alves@tr.com), Julien Ponthus
(julien.ponthus@tr.com) in London and Danilo Masoni (danilo.masoni@tr.com) in Milan.
"WORST PRE-MARKET CALLS EVER!" #HEARDINTHENEWSROOM (0921 GMT)
There are mornings when stocks open roughly the way you expect them to and then there are
days like today!
There was a broad assumption across brokers for instance that sensor specialist ams AG
would surge at the open after an upbeat Q4. Well it did go up very briefly but soon
enough, it was falling deep into negative territory. The update on the rights issue to help
finance its Osram takeover may have given some investors cold feet, a trader noted.
Take Daimler! There's was quite a consensus across morning calls that it would
open just slightly in negative territory after slashing its dividend in another profit warning.
But the car maker made it to the top of Germany's DAX with a 1.7% rise before falling back
down again to the bottom of the German blue chip index.
Another funny one was TUI. While it did report strong demand for holidays that
would help it offset the impact of the grounding of the Boeing 737 MAX, no one expected the
European travel company to surge over 10% to claim the top of the STOXX 600. People were
actually looking at a 1-2% tick upwards at it happened and in these time of coronavirus
epidemic, it's not a given to take big bets on the sector.
Here's AMS first hour of trading, followed by that of Damler:
(Julien Ponthus and Thyagaraju Adinarayan)
*****
OPENING SNAPSHOT: STOXX AT RECORD, TUI TAKES OFF (0824 GMT)
European stocks notched fresh record high levels with clear risk-on moves across the board
as investors once again took comfort from stimulus measures even as death toll from coronavirus
crossed 1,000.
China/coronavirus plays, such as travel & leisure index, autos and miners
are the top gainers. Among travel companies, Tui's blow-out 2019 results are
driving the European travel company's shares 10% higher. The move also boosts easyJet.
Once again, the highly volatile NMC is at the bottom of the STOXX 600 index after
soaring yesterday on buyout approaches from private equity firms KKR and GK Investment.
Deutsche Telekom and Delivery Hero were other significant movers as
expected on news we highlighted in the previous blog.
Here's your opening snapshot:
(Thyagaraju Adinarayan)
*****
CARS IN REVERSE GEAR, TECH SHINES, BRITISH RETAILERS MIXED (0750 GMT)
European stocks are seen opening sharply higher at record high levels, following gains in
Asia and the United States overnight, as Chinese stimulus measures are helping investors keep up
their risk appetite even as the country reported its 1000th death from coronavirus.
Stock futures are rising between 0.6% to 0.9% amid a downpour of corporate headlines.
Autos in focus after Daimler axes its dividend as 2019 profits more than halved,
sending its shares 1% lower in premarket trade. French tyremaker Michelin meanwhile
forecast slightly lower profits in 2020 even without the impact of the coronavirus crisis in
China.
AMS, which supplies sensors to Apple iPhone, is seen rising 5% to 7% reported
fourth-quarter revenues above its own forecast and the upbeat results are likely to boost shares
of peers Dialog Semi, Infineon and STMicro among others.
In telcos, Deutsche Telekom is rising 3% in premarket trade after sources say
that U.S. judge is expected to rule in favor of merger of Sprint, T-Mobile.
In the UK, retailer Ocado shares could rise between 1% and 2%, traders say, after
it forecast 15%-20% revenue growth for 2020, offsetting worries about a 27% drop in 2019
earnings.
High street retailer JD Sports in the spotlight after Britain's competition watchdog
said the company's takeover of rival Footasylum could leave shoppers worse off.
Other potential stock moves flagged by traders: Metro seen 2% higher after it
reached a deal to sell its hypermarkets business; TUI seen up 1% to 2% as strong
demand for holidays helps 2019 earnings, offsetting impact from 737 MAX groundings; Delivery
Hero seen slightly lower on profit-taking after solid 2019 results.
(Thyagaraju Adinarayan)
*****
RECORD HIGH OPEN FOR EUROPE? (0630 GMT)
European stocks seem to be gearing-up to test fresh record highs in a V-shaped rebound
driven by central bank liquidity, even as China reported its 1000th death from coronavirus.
Financial spreadbetters IG expect London's FTSE to open 40 points higher at 7,487,
Frankfurt's DAX to open 92 points higher at 13,586, and Paris' CAC to open 31 points higher at
6,046.
"One of the enormous dilemmas for investors is whether the impact of the coronavirus will be
enough to derail the global economy and usher in another round of Fed + easing," AxiCorp's chief
market strategist Stephen Innes says.
(Thyagaraju Adinarayan)
*****
(Reporting by Danilo Masoni, Joice Alves, Julien Ponthus and Thyagaraju Adinarayan)
