LIVE MARKETS-"Wall of free cash flow around the corner"

* European shares dip * Tech pull back after SAP results * Focus on earnings * FTSE buoyed by softer pound LONDON, July 19 (Reuters) - Welcome to the home for real-time coverage of European equitymarkets brought to you by Reuters stocks reporters and anchored today by Helen Reid. Reach heron Messenger to share your thoughts on market moves: helen.reid.thomsonreuters.com@reuters.net "WALL OF FREE CASH FLOW AROUND THE CORNER" (1015 GMT) The earnings season is underway and investors looking for fat pay-outs may well consider theenergy sector, which has struggled a bit as of late due to a pullback in oil prices but is inhealthy shape after recent years' restructuring efforts. Thomas Adolff, analyst at Credit Suisse, sees a "wall of cash flow around the corner" andsays now that the big European oil majors have successfully repaired their businesses, the keyissue is what to do with the extra money. Most oil companies break even at around $50 dollars per barrel, he notes, and even after therecent decline, Brent crude prices remain well above $70. "Today, it is less about cash flow break-evens but instead more about what to do with thesurplus in a world where the market is demanding discipline," he says. "We believe that the EuroMajors will mostly stick to their capital frameworks in the next few years, likely with enhanceddistribution policies." Shares in Royal Dutch Shell, BP, Total and Eni have risenbetween 9 and 16 percent so far this year as analysts have kept revising their earningsestimates for the sector upwards. (Danilo Masoni) ***** ARE MARKETS WORRIED ENOUGH? (0943 GMT) There's a lot going on at the moment with trade and geopolitics, and Hermes InvestmentManagement's CEO Saker Nusseibeh says that the one thing worrying him is that markets don't seemto be as worried as he is. "Investors are not preparing for the possibility that things could go really wrong. They areconfident the signs of the last crisis aren’t appearing so are underestimating the risks,thinking it will all turn out fine," writes Hermes' Nusseibeh, adding that long-term investorsshould actually be getting ready to buy if and when the crunch does happen. He cites three reasons behind his misgivings. Firstly, he sees a risk that trade spatbetween the U.S. and China could escalate (even if unintentionally), which wouldn't exactly begreat if we also get a recession give the yield curve is flattening. Secondly, the bull run is getting "pretty long in the tooth" with the market reluctant tolet go and admit that it must end sometime. And thirdly, Nusseibeh is concerned that theindustry has simply lost the ability to navigate divergent economic environments and politicalrisks, instead of simply betting on whether an economy is growing or not. "I worry the asset management business no longer has the skill-set in house to trulyunderstand the political machinations of various governments and states or how they mightinteract within the context of a multi speed global economy and work it all out," saysNusseibeh. (Kit Rees) ***** OPENING SNAPSHOT: EUROPEAN SHARES STRUGGLE FOR DIRECTION (0733 GMT) European shares are off to a rather directionless start today with country indexes movingbetween a fall of 0.3 percent for Germany's DAX and a rise of 0.3 percent for Italy's FTSE MIB. At the sector level, it's worth noting the pull-back in tech stocks on the back of a fall inGerman software maker SAP following its earnings update. Here's your snapshot: (Danilo Masoni) ***** WHAT'S ON THE RADAR FOR THE EUROPEAN OPEN (0647 GMT) European stocks are set to falter at the open as investors lock in profits after a rallytook benchmarks to one-month highs yesterday. Earnings season is in full swing with several heavyweights in consumer goods and industrialsreporting. Disappointment from consumer giant Unilever could weigh on the sector. The Anglo-Dutch makerof ice cream to soap blamed a Brazilian transport strike and weak pricing for its lower thanexpected second-quarter sales growth. Weak pricing was one of investors’ main concerns for theconsumer staples stocks last quarter, too, causing some sharp stock falls. Industrials reported strong results overall, with Swiss engineering company ABB beatingprofit forecasts though its sales were weaker and it warned about rising geopoliticaluncertainties. Truckmaker Volvo’s profit also topped forecasts, perhaps providing a sentimentboost to the autos sector hit by tariff fears. France’s Alstom and Sweden’s SKF also reportedstrong results. And tech stocks, which led gains on Thursday, could extend their rally after Europe’sbiggest tech company, SAP, raised its outlook on forecast-beating results thanks to growth inits cloud business. Nordea, the Nordic region’s biggest bank is indicated up 1 percent after its second quarterprofit topped forecasts, though it said revenues were unlikely to reach last year’s level in2018. And UK engineer Babcock lowered its full-year revenue outlook; its shares areseen down 5 to 10 percent at the open. (Helen Reid) ***** FUTURES POINT TO LACKLUSTRE OPEN (0613 GMT) European benchmark futures are trading down 0.1 to 0.2 percent across the board, indicatingthe recent rally will peter out today as investors take profits. It's a heavy day for earnings meaning results will likely drive more movement underneathindex levels. Adding to the list of earnings out so far, consumer goods giant Unilever has just reportedlower than expected second-quarter sales, hurt by a Brazilian transport strike and weak pricing. The latest headlines: Unilever second-quarter sales disappoint Sweden's SKF Q2 profit beats forecast, sees higher demand in Q3 French group Alstom posts higher Q1 sales Roche Tecentriq cocktail cut lung cancer risk, survival data still to come (Helen Reid) ***** EARLY MORNING EARNINGS ROUND-UP (0539 GMT) Trade war risks and currency risks are the main issues flagged by companies reporting todaythus far. Swiss industrials giant ABB warns geopolitical risks are rising, while unlisted VolvoCars said it was on track for another sales record despite trade tensions - perhaps a positivesign for the autos sector. Here's your results round-up: Publicis stumbles on health unit underperformance in 2nd quarter ABB warns on rising geopolitical risks after Q2 profits beat forecasts SAP raises outlook as cloud growth "unleashed" Volvo Cars targets sales record, facing down trade worries Innogy agrees with E.ON and RWE on planned transaction Nordea Q2 profit narrowly tops forecast Givaudan profit falls as currency losses in Argentina bite Essity Q2 core profit slides as higher pulp prices weigh (Helen Reid) ***** MORNING CALL: EUROPEAN RALLY TO STALL (0531 GMT) European shares are set to take a breather this morning after earnings optimism tookregional benchmarks to a one-month high on Wednesday. Asian shares extended early gains overnight as upbeat Wall Street earnings buoyed globalinvestor sentiment, although trade war jitters pushed China's yuan to fresh one-year lows inboth the onshore and offshore markets. On the radar today are updates from ABB, Alstom, Anglo American, Kone, Kuehne & Nagel,Publicis, Unilever, Volvo, among other big European companies. Spreadbetters CMC Markets expect the FTSE 100 to open unchanged at 7,676 points, the DAX toopen 17 points lower at 12,748 and the CAC 40 10 points lower at 5,437. (Helen Reid) ***** (Reporting by Helen Reid, Danilo Masoni, Julien Ponthus and Kit Rees)