* European shares little changed
* Deliveroo jumps as rival takes stake
* S&P 500 futures dip
Aug 9 - Welcome to the home for real-time coverage of
markets brought to you by Reuters reporters. You can share your
thoughts with us at markets.research@thomsonreuters.com
MINI-BUBBLES: LITTLE TO WORRY ABOUT (1055 GMT)
Back in February JPMorgan argued that the possible burst of
what it then called mini-bubbles would not hurt equity markets.
Fast forward six month, bubbly areas of the market such as
SPACs, IPOs, Bitcoin and hydrogen have indeed deflated, by as
much as 50%, but equities have carried on to record highs.
So JPM was right and looking forward it still believes
mini-bubbles pose little threat.
"We continue to believe that equities will be largely immune
to the price gyrations in certain 'bubble' areas," they say.
"We are of the view that the broad equity market is not
displaying worrying levels of valuations, and that the pockets
of concern are too small/tangential to drive the sentiment for
equities overall." they add.
More broadly they expect the equity market, and the bond
yields, will likely resume moving higher in tandem.
(Danilo Masoni)
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TAKING STOCK OF EUROPE'S RECORD SEASON (0901 GMT)
No doubt this year's second quarter reporting season will be
one to remember with the record 140% estimated jump in profit
growth welcomed by a record-breaking run on the stock market.
But as the season winds down, it's time to take stock and
here are five key takeaways, courtesy of Morgan Stanley.
1) NET BEAT: "We've tracked 58% of companies as having beat
EPS estimates; meanwhile 22% have missed, giving a net beat of
36% of companies".
2) REVISIONS: "Having reached all-time highs post 1Q
results, the breadth of positive EPS revisions in Europe
continues to come in very strong".
3) MARGINS: "Whilst the breadth of EPS beats has moderated
slightly, the breadth of sales beats is tracking at an all-time
high at +51%... some recent inflationary forces starting to show
up in the data".
4) PRICE ACTION: "... negatively skewed. One side-effect of
the persistent EPS upgrades in the run-up to reporting season is
that a solid 2Q reporting season was likely to be expected by
investors/partially priced".
5) BUYBACKS: "One standout positive that we've noted over
earnings season has been the uptick in fresh buyback
programmes".
(Danilo Masoni)
*****
MIXED FEELINGS IN EUROPE (0754 GMT)
A fall in oil and gold prices is pushing down the
commodity-heavy FTSE 100, while the pan-European index
STOXX 600 is somehow managing to stay afloat.
Shares in oil companies Royal Dutch Shell, BP
and Total Energies are slipping as crude prices
fell more than 2% on fears that the COVID-19 pandemic curbs in
Asia would dent fuel demand.
Miners Rio Tinto, BHP Group and Glencore
are down on weaker metal prices.
The STOXX 600 on Friday posted its strongest week since
mid-March, supported by a flurry of dealmaking activity and a
strong earnings season.
Elsewhere in single stocks, Deliveroo is up 6.5%
after German competitor Delivery Hero took a 5.09%
stake in the UK food delivery company, while Hargreaves Lansdown
is down 8% to the bottom of the FTSE after FY results.
(Joice Alves)
*****
PESTILENCE AND WILDFIRES (0730 GMT)
Chinese imports and exports both undershot expectations last
month, data showed on the weekend, impacted in part by the
COVID-19 resurgence across the country and the rest of Asia.
Those outbreaks have also caused flight cancellations, warnings
by 46 cities against travel, and limits on public transport in
144 of the worst-hit areas in China.
It is a sign of the threat the Delta variant poses to
economic recovery in the developed world, especially the United
States where caseloads are rising fast in some states.
Friday's forecast-beating U.S. jobs data is keeping the
dollar at four-month highs and 10-year Treasury yields above
1.3%. Gold extended losses too, falling as much as 4% at one
point. But the COVID worries drove oil prices down 2.4%, adding
to last week's 6% loss.
And Wall Street, which notched a record close on Friday, is
tipped to open weaker as are European stocks following five
consecutive all-time peaks hit last week. Asia's COVID surge is
also hitting some shares -- Adidas for instance is tipped to
open 1% lower due to a hit to supply chains in Vietnam.
But Chinese stock markets rose, buoyed perhaps by hopes of
more government support for the economy. Also on the stimulus
front, the U.S. Senate is moving slowly towards passing a $1
trillion bipartisan infrastructure bill.
There are also corporate stories aplenty.
In M&A, private equity firm CD&R has been given more time to
up its bid for Morrisons, Germany's Delivery Hero has taken a
5.09% stake in food delivery rival Deliveroo and Swedish auto
parts maker Veoneer is to start talks with chipmaker
Qualcomm whose $4.6 billion offer topped a rival bid by
Magna.
Philip Morris has upped its bid for British drugmaker
Vectura.
Finally, as wildfires ravage Turkey, Greece and the United
States, expect a stark warning from the United Nations climate
change panel on how quickly the planet is warming.
Key developments that should provide more direction to markets
on Monday:
-China's factory gate inflation in July rose at a faster clip
from the previous month
-Bank of England deputy governor Ben Broadbent speaks
-Federal Reserve speakers: Atlanta Fed's Rafael Bostic, Richmond
Fed's Thomas Barkin
-German trade balance
-U.S. JOLTS jobs opening
-U.S. earnings: Tyson Foods, AMC
(Sujata Rao)
*****
EUROPEAN SHARES SEEN HIT BY COMMODITY TUMBLE (0630 GMT)
A sharp fall in gold and oil prices hit European futures,
which are pointing to a lower opening for bourses across the
region, after the STOXX 600 reached five consecutive record
highs last week.
Investors are also still assessing whether Friday's strong
U.S. payrolls report would take the Fed a step nearer to winding
back its stimulus, while figures for July CPI due this week
expected to confirm inflation has peaked.
The Fed will certainly be in focus this week, with four
officials speaking offering enough grist for markets looking for
clues on the timing of tapering.
(Joice Alves)
*****
