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 Joice Alves (joice.alves@thomsonreuters.com)
and Julien Ponthus (julien.ponthus@thomsonreuters.com) in London and Danilo Masoni and Stefano
Rebaudo (stefano.rebaudo@thomsonreuters.com) in Milan.
ON THE RADAR: BANKS, AGAIN... (0642 GMT)
Being the sector which has bore the brunt of the coronavirus crisis on the trading floors,
banks definitely don't need the attention of a new scandal, but there you go.
With BuzzFeed and other media reporting several global banks moved large sums of allegedly
illicit funds despite red flags about their origins, banking shares are set to open in negative
territory.
HSBC and Standard Chartered's shares in Hong Kong shares already fell on Monday and there's
possibly more losses to come during the European session.
On a more positive note, after a wave a domestic mergers, there's some speculation of
pan-European mergers brainstorming going on. On a more limited scale, Societe Generale is
gearing up to launch the sale of its asset management arm Lyxor.
Talking about deals, French telecoms group Iliad is launching a bid for Polish mobile phone
operator Play, valuing the company's total capital at 2.2 billion euros and corresponding to an
enterprise value of 3.5 billion euros.
There's already quite a bit of market price action in Germany in the sector with shares in
United Internet down 14.4% in early Frankfurt trade, while its subsidiary 1&1 Drillisch losing
18.3% after a guidance cut.
Shares of Britain's Rolls-Royce Holdings are also in the spotlight after the group said it
was looking to raise up to 2.5 billion pounds in an effort to strengthen its balance sheet.
Still in London, Royal Dutch Shell is looking to slash up to 40% off the cost of producing
oil and gas in a major drive to save cash so it can overhaul its business and focus more on
renewable energy and power markets, sources told Reuters.
More generally, the FTSE 100 and 250 will be under pressure as Boris Johnson ponders
additional COVID-19 restrictions with the trend of infections seemingly going in the wrong
direction.
On the bright side, there's quite a lot of chatter about more support for the UK economy.
Another morale booster for London is Streaming firm Wheaton Precious Metals announcing it is
planning a UK listing by year-end, potentially the largest metals and mining company to join the
London Stock Exchange since Glencore in 2011.
(Julien Ponthus)
*****
MORNING CALL: GLOOMY BUILD-UP (0532 GMT)
This week just doesn't look set for a happy beginning with quite a gloomy build-up so far.
European futures are down about 0.6% while the FTSE appears ready to make losses more in the
region of 0.9%. Wall Street futures are also down about 0.4% and the session in Asia is ending
on a negative note as MSCI's broadest index of Asia-Pacific shares outside Japan
retreats 0.4%.
Fears about the resurgence of the pandemic in Europe are expected to keep traders on their
toes.
As noted by Michael Hewson at CMC Markets, sentiment at the start of last week was boosted
by a wave of M&A wave but there's nothing expected of the sort this morning so far.
"As we look to a new week, with investors absorbing the recent statements from central
banks, and the prospect that further stimulus may not come immediately, concerns are rising that
the summer recovery is probably as good as it gets when it comes to the recent rebound in
economic activity", he writes.
"This reality combined with the growing realisation that a vaccine remains many months away,
despite President Trumps claims to the contrary, has made investors increasingly nervous, as we
head into an autumn that could see lockdowns reimposed", Hewson told his clients.
(Julien Ponthus)
****
