Welcome to the home for real-time coverage of European equity markets brought to you by Reuters
stocks reporters. You can share your thoughts Joice Alves (joice.alves@thomsonreuters.com) and
Julien Ponthus (julien.ponthus@thomsonreuters.com) in London and Stefano Rebaudo
(stefano.rebaudo@thomsonreuters.com) in Milan.
ON THE RADAR: STAGECOACH, BRITVIC, IBERDROLA, NORSK HYDRO (0645 GMT)
It seems that yesterday's rally is running out of steam with European futures to open in the
red and investors will also have a very mixed batch of earnings to digest.
British soft drinks maker Britvic sales sink 16% on lockdown hit, while UK transport company
Stagecoach says it is difficult to forecast future profitability after its earnings per share
fell 39% in its 2019-2020 financial year as the lockdown hit demand for travel.
On a brighter note, Spanish renewable energy giant Iberdrola expects profit growth this year
despite taking a hit in the first half.
And there is also a batch of better-than-feared results: Norwegian metals maker Norsk Hydro
posted a surprise rise in Q2 earnings, helped by ramp-up of its Alunorte plant in Brazil and
costs cuts. Swedish mining group Boliden also tops forecasts helped by higher milled volumes in
its mines and stable production in its smelting operations.
Swiss engineering company ABB posted better than expected Q2 results but it warned it still
expects tough quarters ahead.
A unit of Google parent Alphabet, the self-driving car company Waymo and Fiat Chrysler are
expanding their autonomous vehicle partnership to commercial vehicles, they say. And Fiat
Chrysler will develop fully self-driving vehicles exclusively with Waymo going forward.
Hong Kong's Cathay Pacific Airways reached an agreement with Airbus to delay deliveries and
is in advanced talks with Boeing about deferring its orders.
(Joice Alves)
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EARNINGS: IT'S GOING TO GET WORSE BEFORE IT GETS BETTER (0617 GMT)
The latest data from Refinitiv shows that expectations for STOXX 600 Q2 earnings have
worsened to a 58.6% fall year-on-year versus 56.2% forecast last week.
Being just at the beginning of the season, it's still hard to gauge if that's leaning on the
pessimistic side of things.
Anyhow, on the bright side, the rebound is more robust in 2021 with a whopping 83% rebound
in Q2 and 50.5% in Q3.
Here's the Refinitiv table for this week and below, the one from July 14 so that you can
compare how expectations evolved within seven days:
(Julien Ponthus)
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MORNING CALL: SHAKY MOMENTUM (0527 GMT)
The boost in sentiment from the EU recovery fund deal had already started to fade towards
the end of the session yesterday and by the look of futures this morning, there's not much left.
Futures are down 0.4% and 0.5% for the STOXX 50E and the DAX respectively, while it's also
0.3% in the red for the FTSE 100.
True, most indexes in Europe are back to March or late February highs but there's no
guarantee that momentum will keep them going higher given the uncertainty on the pandemic front
and without a clear boost from the Q2 earnings season.
Uncertainty over the next U.S. fiscal relief package is clearly also not helping.
(Julien Ponthus)
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