Last checked at 
* European STOXX 600 up 0.9%
* Basic materials stock index up 2.8%
* Tech stocks shine too, up 1.9%
Oct 14 - 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
Q3 RESULTS: EVEN A MODEST BEAT CAN BOOST PRICES (1121 GMT)
As we are entering the thick of Europe’s earnings season
next week, we could use some insight into a possible market
reaction.
“We believe that investor sentiment is quite cautious going
into results season,” Morgan Stanley analysts say, referring to
headwinds from supply chain disruptions and energy costs.
“Hence a modest net beat is likely to result in a positive
outcome for markets provided it is not accompanied by negative
forward guidance for 4Q and beyond,” they add.
Here are 10 stocks where Morgan Stanley analysts have
conviction into earnings.
Acerinox, Elis, Hugo Boss,
Moncler, Societe Generale, Teleperformance
, UniCredit and Whitbread.
(Stefano Rebaudo)
*****
WORRIED ABOUT THE Q4 EARNINGS SEASON? (0828 GMT)
Worries about a steady increase of profit warnings due to
rising energy prices and supply shortages have been weighing on
market sentiment.
But the backdrop might be better than some investors fear.
While we are entering the thick of Europe’s earnings season
next week, Refinitiv I/B/E/S data shows an uptick in earnings
growth expectations to 46.7% for the STOXX 600 in Q3, that's
1.1% higher than last week.
UBS analysts flag that the earnings drag from supply chain
and energy price "issues will likely be worst in the fourth
quarter before conditions start to improve,” UBS analysts say.
But, they expect the impact to be concentrated in a few
sectors while reducing “our full-year 2021 S&P 500 EPS estimate
by about 1%, all else equal.”
Financials, the internet, software, and healthcare (not to
mention smaller sectors like real estate, utilities, energy, and
most materials) should be unaffected by supply chain problems.
(Stefano Rebaudo)
*****
EUROPEAN BOURSES ON THE RISE AHEAD OF EARNINGS SEASON (0740
GMT)
European shares are comfortably in positive territory amid
hopes for a strong earnings report season, and as global
investors are taking the view that central banks will act to put
a halt on rising inflation.
The pan-European STOXX 600 index is up 0.6%, with
tech and basic resources stocks gaining around
2%.
Semiconductor companies including ASML, AMS
and BE Semiconductor are some of the top
gainers after Taiwan chip giant TSMC posted a 13.8%
jump in third-quarter profit on the back of booming demand for
semiconductors.
After a profit warning, shares in Dutch navigation and
digital mapping company TomTom are down 4%, as the
company said supply chain problems in the auto sector could last
until the first half of next year.
(Joice Alves)
*****
NO ESCAPING THE INFLATION BEAST (0703 GMT)
It doesn't seem to matter where you look these days, that
long asleep beast - inflation - is clearly wide awake.
Data on Thursday showed China's factory gate prices grew at
their fastest pace on record in September, a day after figures
showed another solid increase in U.S. consumer prices.
The take away from markets is that transitory or not,
central banks are likely to respond to higher inflation sooner
rather than later.
And with minutes from last month's Federal Reserve meeting
showing policymakers' growing concern about inflation, investors
have again brought forward rate-hike expectations.
Fed Funds futures have pulled forward expectations for the
first hike from late in 2022 to almost fully price a 25 basis
point hike by September.
In addition, money market pricing suggests the Bank of
England could move before year-end, the cautious European
Central Bank could tighten next year and the overtly dovish
Reserve Bank of Australia could raise rates by end-2023 -- a
trajectory that doesn't gel with the central bank's guidance.
Singapore's central bank on Thursday unexpectedly tightened
monetary policy, citing forecasts for higher
inflation.
Markets, having priced in higher inflation and a tighter
monetary policy outlook, appear to be in a calmer mood in early
Europe. Asian shares rallied overnight, European and U.S. stock
futures are higher too. U.S. Treasury yields, while a touch
higher, are holding below recent multi-month highs.
Still, China property shares fell as investors fretted about
a debt crisis in the sector.
The Turkish lira, at record lows versus the dollar, is also
in the spotlight after Turkey's President Tayyip Erdogan
dismissed three central bank officials.
Key developments that should provide more direction to
markets on Thursday:
- BOJ policymaker rules out stimulus withdrawal even after
economy recovers
- Taiwan's TSMC posts 13.8% rise in Q3 profit on global chip
demand surge
- Japan dissolves parliament, setting stage for general election
- Data: Spain harmonized inflation rate(Sept), Canada
manufacturing sales (Aug)
- United States: Initial Jobless Claims (Oct), Jobless Claims
4-week Average, PPI (Sept), NY Fed Treasury Purchases 22.5 to 30
years, 4-week and 8-week T-Bill Auction
- Central Banks: Fed’s Bowman, Bostic, Barkin, Bullard, Daly and
Harker, ECB’s Elderson, and BoE’s Tenreyro and Mann speak
- Earnings: UnitedHealth, Bank of America, Wells Fargo, Morgan
Stanley, Citigroup, US Bancorp, Walgreens Boots Alliance, Fast
Retailing, Domino’s Pizza.
(Dhara Ranasinghe)
*****
EUROPEAN SHARES SEEN ON THE RISE (0640 GMT)
After rising to a two week highs, the pan-European STOXX 600
is set to start the day in positive territory mirroring Asian
stocks as investors are taking the view that inflation will
motivate central banks to increase rates.
Futures on the main European indexes are up about 0.5%
Data showed another solid increase in U.S. consumer prices,
while minutes from last month's Federal Reserve meeting showed
policymakers' growing concern about inflation and a general
agreement to start tapering asset purchases soon.
But investors will also have some corporate earnings results
to digest. Dutch navigation and digital mapping company TomTom
has warned supply chain problems in the auto sector
could last until the first half of next year after it reported a
bigger than expected quarterly core loss.
Markets will be awaiting today U.S. producer prices and
jobless claims figures as well as appearances from Bank of
England and Federal Reserve policymakers.
(Joice Alves)
*****
