European shares edge higher after breakthrough in Merkel migration row

European Stock Markets

European shares edged higher on Tuesday after German Chancellor Angela Merkel’s conservatives settled a row over migration and gave some respite to investors facing a rage of political worries including trade tensions with the United States. 

The pan-European STOXX 600 was up 0.6 percent by 0833 GMT with Germany's DAX .GDAXI posting the best performance with a 0.9 percent rise.

The dispute over immigration had threatened to topple Merkel’s fragile governing coalition but in a breakthrough late on Monday evening, her rebellious interior minister dropped his threat to resign after five hours of talks.

Asian shares, which had sustained heavy falls overnight, particularly in China, recouped some of their losses before European bourses opened, helping restore sentiment.

Chinese financial markets have been jittery ahead of a July 6 deadline, when the U.S. is set to slap tariffs on $34 billion worth of Chinese goods that Beijing has vowed to match with tariffs on U.S. products.

Miner Glencore fell more than 10 percent after it said a subsidiary had received a U.S. Department of Justice subpoena requesting documents and records on compliance with the Foreign Corrupt Practices Act and U.S. money-laundering statutes.

The documents requested from subsidiary Glencore Ltd relate to the group’s business in Nigeria, the Democratic Republic of Congo (DRC) and Venezuela from 2007 to present, Glencore said, adding it was reviewing the subpoena.

Another big faller was BE Semiconductor, the Dutch equipment maker (BESI.AS) lost over 8 percent after cutting revenue forecast.

Societe Generale (SOGN.PA) rose 1.3 percent and Commerzbank (CBKG.DE) up 2.1 percent after the latter agreed to sell its equity markets and commodities business (EMC) to the French bank.

Europe's banks, autos stocks sink as trade dispute deepens

The latest episode in a trade dispute between the United States and other major economies sent European shares further into a funk on Monday with benchmarks down 0.7 to 1.4 percent.

A report that U.S. President Donald Trump plans to bar many Chinese companies from investing in U.S. technology firms and block more tech exports to Beijing hit Asian stocks overnight and dented early European trading.

Europe’s tech sector .SX8P fell 0.9 percent on the news.

More disrupted by trade war worries was the autos sector .SXAP, a key target for Trump who said on Friday he aimed to hike tariffs on EU car imports by 20 percent. It fell 1.4 percent, set for its seventh straight day of losses.

The pan-European STOXX 600 declined 0.7 percent while Germany’s exporter- and autos-heavy index fell 0.9 percent.

Bank stocks .SX7P were the worst-performing, with Commerzbank (CBKG.DE) and Deutsche Bank (DBKGn.DE) bottom of the DAX while HSBC (HSBA.L), Santander (SAN.MC) and UBS (UBSG.S) were among the biggest fallers Europe-wide.

Italian cable maker Prysmian (PRY.MI) fell 4.7 percent, the biggest loser on the STOXX, at the open after it cut its guidance due to additional expected costs related to issues with its UK WesternLink undersea cable project.

Danish medical equipment maker Ambu (AMBUb.CO) jumped 6.5 percent to the top of the STOXX after JP Morgan started coverage of it with an “overweight” rating.

Telenet (TNET.BR) also gained 5 percent after starting a 300 million euro share buyback programme.
IWG (IWG.L) rose 5.2 percent after confirming it received a possible cash offer from private equity firm Terra Firma and is evaluating it.

Stocks Rebound as Korea Concerns Cool; Oil Falls

European Stock Markets

The Stoxx Europe 600 Index advanced, with most sectors in the green, and equity-index futures pointed to a higher U.S. open as concerns about an escalation in tensions over North Korea’s nuclear program eased. 

WTI crude slumped below $70 a barrel after a Saudi minister said supply would likely be boosted in the second half. Italy’s bonds dropped as worries mounted over its leadership, sending the spread between German and Italian 10-year yields above 2 percentage points. 

Earlier, stocks in Asia saw modest declines.

Investors are are taking a more sanguine view on geopolitical risks, after stocks declined from the U.S. to Asia as President Donald Trump blamed the “tremendous anger and open hostility” from Pyongyang for his decision to scrap his planned meeting with Kim Jong Un. While North Korea’s apparent willingness to keep talking appeared to soothe markets, other risks remain. 

Spain’s biggest opposition party is ready to push for a no-confidence motion against Prime Minister Mariano Rajoy, while tensions around global trade linger.

Elsewhere, Turkey’s lira swung between gains and losses, though still heading for its worst week since in eight years, after the central bank said it would allow exporters to repay dollar-denominated loans in the local currency, while the pound weakened after the European Union dismissed many of the U.K.’s plans for their post-Brexit relationship.


The Stoxx Europe 600 Index rose 0.5 percent as of 11:10 a.m. London time.
Futures on the S&P 500 Index rose 0.2 percent.
The U.K.’s FTSE 100 Index gained 0.2 percent.
Germany’s DAX Index increased 1.1 percent.
The MSCI Emerging Market Index rose 0.3 percent.
The MSCI Asia Pacific Index fell 0.1 percent.

Euro remains stuck at four-month lows; U.S. bond yield rise supports dollar

European Stock Markets

The euro remained stuck near four-month lows on Tuesday after weaker-than-expected economic growth in Germany and a rise in U.S. Treasury yields helped the dollar recover following a pause in its rally.
 

The dollar’s strength also helped it gain to within a whisker of hitting a 3-1/2 month high versus the Japanese yen while major currencies elsewhere traded within tight ranges ahead of U.S. retail sales.

The greenback’s rally, which has seen the dollar claw back most of its 2018 losses after a reassessment of the path of U.S. monetary policy versus other countries, came to a halt last week following disappointing U.S. inflation numbers.

Euro bulls were also given a boost on Monday after European Central Bank policymaker Francois Villeroy de Galhau said that the ECB could give fresh guidance on the timing of its first rate hike as the end of its exceptional bond purchases approaches.

German economic growth slowed slightly more than expected in the first quarter of the year due to weak trade but analysts called it a blip and predicted Europe’s biggest economy would shift into a higher gear again.

A survey showed that the mood among German investors remained unchanged at its lowest level in five and a half years in May, reflecting persisting concerns that Europe’s biggest economy could be hit be a trade dispute with the United States.

The euro slipped 0.1 percent to $1.1919, but remained below Monday’s high of $1.1996, which was the common currency’s highest level since May 3.

The dollar’s index rose 0.2 percent to 92.764, pulling up from 92.243 on Monday, which was its lowest level since May 2.

The benchmark 10-year U.S. Treasury yield increased two basis points to about 3.019 percent, after rising two basis points on Monday, helping support the greenback.

The benchmark yield was supported by signs of an easing in trade tensions between the United States and China after U.S. President Donald Trump pledged to help Chinese telecoms firm ZTE Corp, which has been penalised for violating U.S. sanctions with Iran.

The Norwegian crown rose 0.3 percent versus the euro to 9.56 crowns after strong quarterly economic data raised expectations of a rate rise later this year. It later gave up most of those gains.

The ailing Turkish lira fell to a fresh record low of 4.3990 against the dollar, bringing its losses this year to more than 13 percent after President Tayyip Erdogan said he plans to take greater control of the economy.

Argentina’s peso plunged to a new record low despite hefty central bank interventions in the past few days and policy makers jacking rates higher in an attempt to stop the peso’s slide.

European shares weighed by BT, utilities, but banks gain

European Stock Markets

European shares steadied on Thursday as a flurry of company results rolled in with losses in BT following a disappointing update and weighed down further by a weakness among utilities stocks.

Gains in RBS (RBS.L) following a multi-billion deal to settle a U.S. investigation of the bank’s bond sales, and a solid update from Italy’s biggest bank UniCredit (CRDI.MI) buoyed the banking sector, helping the pan-European STOXX 600 steady by 0748 GMT.

BT (BT.L) shares fell 7.1 percent after saying it was cutting 13,000 jobs, the latest attempt by Britain’s biggest telecoms group to rebuild after an accounting scandal and a downturn in trading.

Traders said its latest update showed a disappointing guidance, while Jefferies analysts highlighted that the company missed on the opportunity of announcing a bolder mover of fiber roll out while job cuts were bigger then expected.


RBS rallied 5.5 percent after it agreed to pay a smaller-than-expected $4.9 billion to resolve a U.S. investigation into its sale of mortgage-backed securities.

Analysts, who had estimated the U.S. could impose a fine of up to $12 billion, said the bank could reinstate a dividend.

Gains in RBS helped the UK's FTSE .FTSE edge ahead 0.2 percent, outperforming other European bourses ahead of a Bank of England policy meeting expected to keep interest rates on hold.

Still in banks, UniCredit rose 2.7 percent after it posted its best first-quarter result since 2007, topping forecasts with a 1.1 billion euro net profit thanks to lower-than-expected loan losses.

Italy's FTSE MIB .FTMIB fell as much as 0.7 percent, as bond yields jumped on an increased possibility that a government of anti-establishment parties will take power. The index however recovered ground and was up 0.2 percent.

Top movers on the STOXX also included precious metals miner Randgold (RRS.L), down 6.6 percent after its quarterly profit fell, while Next (NXT.L) rose 5.7 percent after a strong outlook and trading update.

Utilities were a weak spot, down 0.8 percent to lead sectoral losers in Europe, weighed by a disappointing update at Italy’s Enel (RRS.L)

Global Stocks boosted by tech gains and Korean vibes

Global Stock Markets

World stocks rose on Friday, lifted by strong share price gains for tech giants such as Amazon and Facebook and growing hopes of a lasting peace on the Korean peninsula after a ground-breaking meeting of North and South Korean leaders. 

European shares were set to end the week with a flourish too with a pan-European index set to post its fifth week of gains in a row, rivaling last September’s winning streak, with the tech sector strongly outperforming.

The latest gains are being partly spurred by forecast-beating first quarter earnings from two of the so-called FANG tech stocks — some of the world’s largest and most influential companies by market capitalization — which has boosted sentiment on the technology sector worldwide.

Amazon.com Inc shares jumped more than 6 percent in after-market trading while Facebook surged 9.1 percent on Thursday, calming worries about the fallout from its use of consumer data.

European tech shares rose 0.75 percent to the highest in more than five weeks, buoyed also by gains in local IT and chipmaking firms such as Capgemini, ASML and Infineon.

In Britain, there was bad news on the growth front, with data showing the economy slowed much more sharply than expected in the first three months of 2018.

That has slashed market expectations of an interest rate increase by the Bank of England next month and sent sterling plunging to the lowest since March 9 against the dollar

The data indicated “that the (UK) slowdown is more structural”, Mizuho’s head of hedge fund sales, Neil Jones, said.

However, sterling’s slide helped UK shares on the FTSE index to rise nearly half a percent with gains led by multi-national earners which earn a big chunk of their revenues overseas but report profits in pounds.

The weak data adds to concerns that economic growth across the developed world is running out of steam, especially after lackluster euro zone figures earlier in the week and data on Friday showing French economic growth slowed more than expected in the first quarter.

Earlier, though, Asian markets reveled in the glow of the summit between North Korea’s Kim Jong Un and South Korean president Moon Jae-in. Political leaders and investors hope this would ease tensions over Pyongyang’s nuclear weapons program and pave the way for the North and South to end their decades-long conflict.

That helped Seoul shares briefly rise more than 1 percent to a one-month high and the won firmed. MSCI’s index of Asian shares outside Japan rallied 0.8 percent and Japan’s Nikkei share average rose 0.7 percent to two-month peaks.

The dollar meanwhile hit its highest since Jan. 12 against a basket of currencies, having benefited from the recent run in U.S. Treasury yields — 10-year yields hit 3 percent this week for the first time since January 2014.

With a weekly gain of more than 1.5 percent, the greenback is set for its best weekly performance since late-November 2016.

European shares recover further while Sage and Hammerson hammered

European Stock Markets

European shares trod water on Friday, holding near one-month highs at the end of a week laden with geopolitical worries, while results disappointments drove some sharp moves. 

The STOXX 600 was on track for its third straight week of gains, its longest winning streak since January, as investors shrugged off geopolitical concerns to focus instead on a results season expected to support equity markets.

The beginnings of European companies’ first-quarter results were largely positive, though misses were badly punished.

Shares in British software firm Sage sank 19 percent, the biggest decline on the STOXX, after the company cut its full-year revenue guidance as software subscription growth slowed in the first half.

On the other hand, Finnish paper maker Stora Enso jumped 4.5 percent to the top of the index after reporting stronger than expected first-quarter results.

M&A news continued to be a key driver.

Klepierre shares rose 4.3 percent after the commercial real estate firm said it had dropped a bid for Hammerson and would not pursue a takeover of the UK firm.

Hammerson meanwhile dropped 13 percent to trade at 452.7p, erasing nearly all the gains the stock had made from Klepierre’s first takeover bid on March 19.

In earnings reactions, L’Oreal reported a strong sales beat thanks to good performance from China and luxury cosmetics, but the shares wilted after touching a five-month high in early deals, last trading down 0.2 percent.

Traders put the muted reaction down to technical selling and profit-taking.

Overall mining and industrial stocks were the best-performing, enjoying a boost from metals prices which surged higher this week after sanctions on Russian aluminium firm Rusal.

European shares boosted by good results from insurance heavyweights

European Stock Markets

European shares rose on Thursday, buoyed by good results from companies including insurance heavyweights Munich Re (MUVGn.DE) and Generali (GASI.MI), while Societe Generale (SOGN.PA) fell after its deputy CEO unexpectedly resigned. 

SocGen shares slid 2.5 percent after the French bank said Didier Valet was leaving ‍following “a divergence of approaches regarding management of a specific legal matter”, without elaborating.

A source familiar with the matter said the divergence related to investigations over the suspected rigging of the Libor interbank rate, and brokers raised concerns over the impact of litigation.

SocGen shares fell as much as 4.3 percent to their lowest level in more than 2 months, but staged a late recovery to end down 0.7 percent.

Gains in the insurance sector .SXIP and strength among tech stocks .SX8P, however, helped push the pan-European STOXX 600 index up, accelerating gains in afternoon trading. It ended the day up 0.5 percent after two days in the red.

Tensions on trade took a back seat as investors turned their focus back to earnings updates.

Munich Re (MUVGn.DE) shares rose 2.8 percent after the world’s largest reinsurer raised its 2018 profit forecasts and said it planned to buy back 1 billion euros in shares.

Generali (GASI.MI) also rose 2.5 percent after it raised its dividend following record operating profit.

Following on from rival Inditex’s disappointing results on Wednesday, Swedish clothing firm H&M (HMb.ST) published lower-than-expected quarterly sales, sending shares in the world’s second-biggest fashion retailer down 4.6 percent.

Dufry (DUFN.S) shares fell 6.2 percent after results, with traders attributing the drop to a lack of clarity on its dividend plans.

Banks .SX7P rose slightly after the European Central Bank released long-delayed guidelines on treating new soured bank debt. The guidelines will go into effect on April 1 but lenders may get a reprieve from full implementation until 2021.

Italian banks .FTIT8300, which hold nearly one third of the euro zone bad loan pile, gained 1.4 percent.

Meanwhile oil and gas stocks .SXEP were the worst-performers, down 0.2 percent, tracking a dip in crude prices after the U.S. announced expanded sanctions against Russians.

Overall, fourth-quarter earnings for the STOXX 600 are expected to increase 15.8 percent from Q4 2017, and more companies than usual have beaten earnings and revenue estimates.

European shares climb higher as investors eye U.S. inflation data

European Stock Markets

European shares edged higher on Tuesday, with trading muted as investors awaited the latest inflation figures from the United States, while results drove big moves in Iliad and E.ON. 

French telecoms company Iliad fell 6.7 percent even as it reported higher annual sales and profits for 2017, with traders pointing to flat fixed-line revenues in the final quarter. 

It comes as dominant French telecoms company Orange returned to growth last year for the first time since 2009 after spending heavily to roll out high-speed broadband. 

The STOXX 600 gained 0.1 percent, while Italian and Spanish stocks rose 0.3 to 0.4 percent. Britain’s FTSE was a laggard, down 0.1 percent. 

Utilities were the best-performing sector for a second day on plans by German utilities RWE and E.ON to divide up the assets of power utility Innogy. 

E.ON got a further boost to the top of the STOXX 600 on Tuesday, its shares gaining 4.4 percent after its results. The company said it would raise its dividends for 2018 and 2019. 

Struggling South African retailer Steinhoff saw its Germany-listed shares rise 5.5 percent after it cut its stake in KAP Industrial as it tries to plug a liquidity gap. 

Wacker Chemie fell 4.3 percent, with traders citing a weaker full-year outlook from the chemicals maker which said sales would slow due to currency pressures. 

Veolia fell 2.8 percent, the top faller on France’s CAC 40, after the Qatari government sold its 4.6 percent stake in the utility group.

European shares slide to two-week lows

European Share Markets

European shares fell to new two-week lows on Friday after Donald Trump said the United States would impose tariffs on imported steel and aluminium, prompting worries over a global trade war.

Such concerns sparked a broad sell off in Europe, sending the pan-regional STOXX 600 index down 0.7 percent by 0825 GMT.

Germany’s DAX fell 1.1 percent and Britain’s FTSE dropped 0.3 percent.

All sectors were trading in negative territory, with autos leading the drop and weighed down by a 3.7 percent slump in Fiat Chrysler shares on concerns that the U.S. tariff move could increase raw material costs. 

Steel and aluminium stocks were also generally lower with ArcelorMittal, Salzgitter and Norsk Hydro all down around 2 percent. 

Steel pipes maker Tenaris, which has production and marketing facilities in the United States, however, rose around 0.6 percent. 

Precious metal miners outperformed as investors sought refuge in safe-haves assets such as gold following Trump’s announcement. 

Randgold, Centamin and Polymetal all rose more than 1.7 percent. 

Swedish radiation therapy equipment maker Elekta, up 9.9 percent, led gainers on the STOXX after it reported above-forecast earnings, while IMI dropped 7.5 percent as its trading update disappointed.

The STOXX was on track to end the week, already marked by worries over faster rate hikes in the United States, down more than 2 percent.

Stocks - European Markets - Fresh Earnings on Tap

European Stock Markets

European markets opened lower on Tuesday, weighed by downbeat sentiment in the U.S. and Asia overnight and as investors remained cautious before a fresh batch of corporate earnings reports.

The EURO STOXX 50 slipped 0.28%, France’s CAC 40 fell 0.11%, while Germany’s DAX 30 eased down 0.33% by 03:30 a.m. ET (07:30 GMT).

U.S. and Asian markets were pressured lower overnight amid growing caution as U.S. President Donald Trump was set speak to Congress in his first official State of the Union address.

Market participants were also looking ahead to the Federal Reserve's upcoming policy decision on Wednesday for potential indications on the pace of interest rate hikes this year. The U.S. central bank is widely expected to raise rates three times in 2018.

Financial stocks were mixed, as French lenders BNP Paribas (PA:BNPP) and Societe Generale (PA:SOGN) dropped 0.54% and 0.85%, while Deutsche Bank (DE:DBKGn) lost 1.39% and Commerzbank (DE:CBKG) added 0.15% in Germany.

Among peripheral lenders, Italy's Unicredit (MI:CRDI) edged up 0.17% and Intesa Sanpaol retreated 0.64%, while Spanish banks BBVA (MC:BBVA) and Banco Santander (MC:SAN) tumbled 0.90% and 1.21% respectively.

In earnings news, Koninklijke Philips NV (AS:PHG) reported a 9% increase in fourth-quarter adjusted profit. However, shares in the Dutch company were still down 2.51% in early European trade.

ArcelorMittal SA (AS:MT) added to losses, with shares down 0.99%. The Economic Times reported over the weekend that it and Japan's Nippon Steel are planning to put in a joint bid for bankrupt steelmaker Essar Steel.

In London, the commodity-heavy FTSE 100 slid 0.37%, weighed sharp losses in the mining sector.

Shares in Antofagasta (LON:ANTO) lost 1.41% and Glencore (LON:GLEN) tumbled 1.56%, while BHP Billiton (LON:BLT) and Anglo American (LON:AAL) plummted 1.56% and 2.61% respectively.

Financial stocks were also on the downside, as HSBC Holdings (LON:HSBA) declined 0.30% and Lloyds Banking (LON:LLOY) slumped 0.94%, while Barclays (LON:BARC) and the Royal Bank of Scotland (LON:RBS) lost 1.03% and 1.60% respectively.

Meanwhile, BAE Systems (LON:BAES) was one of the top performers on the index, with shares up 1.02%, closely followed by Royal Mail (LON:RMG) whose shares climbed 0.88%.

Late last week, Royal Mail said it reached an agreement with its main trade union following a fight over pensions, pay and working conditions.

In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to a 0.54% drop, S&P 500 futures signaled a 0.34% slide, while the Nasdaq 100 futures indicated a 0.40% decline.

Cyclical strength fuels further climb in European stocks

European Stock Markets

European shares gained further ground on Tuesday, rising to new 2 1/2 year highs thanks to strong industrials and banking stocks, and indebted telecoms group Altice surged on plans to spin off its U.S. business.

The pan-European STOXX 600 index gained 0.4 percent to 399.89 points, its highest since August 2015 and edging closer to an all-time high of 414.06 points. Euro zone stocks .STOXXE rose 0.4 percent.

European equities have had a very strong start to the year, triggering some concerns over valuations becoming too high. The European market temperature is “very hot versus a year ago”, UBS strategists wrote.

The Swiss bank found the bull-bear indicator jumped 84 percent in a year and cyclicals beat by 8 percent - but concluded the European market still offered catch-up potential as it lags the U.S. cycle.
Investors were also closely watching valuations ahead of the earnings season.

The cyclical engine of a new year’s rally which has sent European stocks to multi-year highs rumbled on, with industrials cementing market gains.

Germany’s Siemens (SIEGn.DE) led the way, rising 0.6 percent after the country’s industrial production and exports rose more than expected in November.

Commodities also continued their climb, with stronger metals prices helping the STOXX 600 materials index .SXPP rise 0.9 percent to hit its highest since March 2012, topping the sector leaderboard.

Telecoms and cable group Altice (ATCA.AS) stole the spotlight, jumping 8.0 percent as investors welcomed a decision to spin off its U.S. unit and simplifying the group’s structure in the process.

Traders said any move to reduce debt would be well received by the market, and analysts at brokerage Raymond James said the move could also make the Altice European arm a possible acquisition target for rival French telecoms companies.
Financials provided the biggest boost to the STOXX as optimism over Europe’s economic growth prevailed.

BNP Paribas (BNPP.PA) was among the best-performing banks, gaining 0.5 percent.
A French official said the bank was close to setting up a joint venture with a Chinese partner in the consumer credit sector, as President Emmanuel Macron entered the second leg of a three-day state visit to China.

Germany-listed shares in South African retailer Steinhoff (SNHG.DE) (SRRJ.J) fell 5.5 percent after the ECB sold its Steinhoff bond at a loss as the company grapples with an accounting scandal.

UK retailers Morrisons (MRW.L) and Marks & Spencer (MKS.L), however, were among top gainers after Morrisons reported a stronger than expected Christmas trading season.

European shares steady as tech-financials rotation continues

European shares see-sawed on Tuesday with sectors strongly diverging as a rotation from tech stocks into financials, bolstered by the U.S. tax bill, gathered pace.

Eurozone blue chips, fresh from their best day in five months, held steady, while the broader euro zone index edged up 0.1 percent as strength in banking and consumer stocks outweighed weak tech and mining sectors. 

Germany’s industrials and autos-heavy DAX outperformed peers, up 0.1 percent, while Italy’s FTSE MIB was buoyed by banks Intesa Sanpaolo and Unicredit .

Euro zone banks maintained positive momentum after their best gains in two months on Monday, up 0.3 percent. Societe Generale and BNP Paribas were among the biggest boosts to France’s CAC 40.

Following the pattern in Wall Street and Asian trading overnight, chipmakers led the tech sector down as investors switched from highly valued tech stocks into financials. 

Retailers were set for a rare positive day, the best-performing sector after Goldman Sachs upgraded UK supermarket Tesco to a “buy”, boosting its shares by 3 percent.

Provident Financial sank 15 percent in early deals after UK regulator FCA opened an investigation into its Moneybarn unit.

Euro zone shares get PMI boost, Centrica sinks

European Stock Markets

European shares dipped on Thursday, tracking more timid Wall Street trading as volumes thinned out for the Thanksgiving holiday, while euro zone stocks drove higher, boosted by strong business growth figures for the bloc.

The pan-European STOXX 600 slid 0.2 percent, while euro zone blue chips .STOXX50E erased early losses to trade up 0.2 percent after business surveys for the bloc cemented optimism on the economy.

Euro zone businesses boomed into the year end as November composite, services and manufacturing PMIs beat all forecasts in Reuters polls.

Societe Generale strategists however warned “the eurozone recovery is now a well-known story”, and were less enthusiastic about the potential for equities in the new year, adding that a heavy political agenda in Europe could affect markets.

British stocks lagged peers, down 0.3 percent, as energy firm Centrica plummeted after results.

Centrica (CNA.L) dropped 16.4 percent, set for its biggest daily drop ever, after it lost 823,000 or about 6 percent of its energy customers in four months and full-year earnings missed market estimates.

Leading European gainers was Altice (ATCA.AS), jumping 4.7 percent after a report the debt-ridden French telecoms and cable group was looking to sell its telecoms network in the Dominican Republic.

Its shares are still down nearly 60 percent from the start of the year as funds sold out of the company’s U.S. unit.

Thyssenkrupp (TKAG.DE) reversed early losses to trade up 1 percent after demand for elevators helped boost its orders to a five-year high.

Telecom Italia (TLIT.MI) shares rose 4.7 percent on speculation about a possible spin-off of its telephone network, and after the firm said it would work with Rome under special “golden powers” to protect it as a strategic asset.

As the earnings season drew near its close, MSCI Europe earnings growth was tracking 10.1 percent in dollar terms while companies in the MSCI EMU enjoyed 11.1 percent earnings growth.

Analysts have been revising down earnings estimates for European companies this quarter. Deutsche’s Weidenbach put this down to the strengthening euro denting expectations for earnings from foreign-exposed companies especially in healthcare and consumer staples.

European markets mixed as global positive momentum eases; UK budget in focus

European Stock Markets

The pan-European Stoxx 660 was 0.03 percent higher in mid-morning deals with financial sectors moving in opposite directions.

Utilities were the best performers in mid-morning trade with RWE up by 2.6 percent. The stock has benefited from the collapse of coalition talks in Germany, as analysts are now expected a looser energy policy.

Travel and leisure stocks were among the worst performers on earnings. Thomas Cook was down 14 percent after announcing full year results that showed an 8 percent increase in earnings. However, margins fell in the 2017 fiscal year due to a more competitive environment.

Looking across the European benchmark, the food travel company SSP rose 6 percent after posting a 27 percent increase in underlying profits. At the other end, media group Schibsted fell 8 percent after announcing a new share issue.

U.K. enterprise software company Sage Group was up by 2.7 percent on Wednesday morning after it announced a 10 percent increase in organic operating profit to 475 million pounds ($630 million),

Shares of Dutch firm Akzo Nobel were up by 1.3 percent after Japanese firm Nippon Paint made an all cash offer Tuesday to buy Axalta, Reuters reported, putting an end to Axalta's merger talks with Akzo Nobel.

In commodity markets, oil prices were also higher on expectations of a production cut next week at an OPEC meeting. Brent rose 0.7 percent trading at $63.05 and WTI was up by 1.6 percent at $57.74 a barrel at about 9.50 a.m. London time.

Meanwhile, U.K. Finance Minister Philip Hammond will present the government's latest budget at 12:30 p.m. London time. The budget is the first since the general election and it is expected to include lower economic growth expectations than the one presented a year ago. Hammond is also expected to announce measures to boost housing.

Later, there will be flash consumer confidence numbers in the euro zone out at 3.00 p.m. London time.

European Stocks Drift as Bonds Rise; Dollar Slips: Markets Wrap

European Stock Markets

European stocks struggled for traction and bonds across the region followed Treasuries higher after the European Central Bank was said to be likely to make only small adjustments to its guidance on monetary policy next year.

The Stoxx Europe 600 Index was little changed, with construction and retail stocks leading the decline.  German shares slipped as the country’s political stalemate continued.

 Earlier, stocks in Asia recovered some of their recent losses, with Chinese equities rallying as investors reassessed a crackdown on shadow banking that had shaken confidence. The euro steadied after dropping the most in three weeks on Monday, and the dollar nudged lower.

Meanwhile, sterling inched higher amid reports Prime Minister Theresa May has the backing of ministers to offer the European Union more money to break the Brexit deadlock. Turkey’s lira hit a record low against the dollar but pared some of the drop after its central bank tightened liquidity.

Investor focus stayed on Europe after officials said the ECB is likely to make multiple small adjustments to its guidance on monetary policy next year rather than any major change in language as it ends quantitative easing.

Political developments in Germany are being closely watched even though some have concluded that economic growth won’t be threatened by the collapse in talks between Merkel and potential coalition partners. The German Chancellor said she would prefer new elections if she can’t put together a majority.

In the U.S., confirmation that Federal Reserve Chair Janet Yellen will leave the board in February creates a fourth vacancy for President Trump to fill, making it trickier for investors to bet on the central bank’s interest rate trajectory next year.

While the Thanksgiving holiday gives traders an excuse to pause, equities are heading into the end of the year near their peaks, with investors optimistic about global growth and company earnings.

Elsewhere, the Australian dollar dropped to a five-month low after suggestions from the central bank that interest rates will stay lower for longer. West Texas oil rose toward $57 a barrel before U.S. government data forecast to show crude stockpiles resumed declines.

European shares weighed down by disappointing updates, downgrades

European Stock Markets

European shares steadied on Friday with disappointing company updates and broker downgrades weighing on the broader market, while pay-TV firm Sky rose on speculation of takeover interest.  

Elior (ELIOR.PA) fell 18 percent after Europe’s third-largest catering group cut its profit guidance, while media group Vivendi (VIV.PA) fell at the open after its third quarter results fell short of analyst expectations.

Their declines and weakness among industrial stocks weighed on the STOXX 600 index, which was flat at 385 points by 0824 GMT following a strong rebound in the previous session. Shares in H&M (HMb.ST) and Inditex (ITX.MC) fell more than 2 percent following broker downgrades.

The pan-European benchmark index is down around 0.9 percent so far this week, set for its second weekly loss in a row, as investors have been locking in profits following a strong year.

Outside the STOXX, Carillion (CLLN.L) wiped out more than half of its stock market value after the UK builder said it would breach its financial covenant and warned on profits for the third time this year.

Among the gainers, Sky (SKYB.L) rose 2.7 percent after reports that Comcast (CMCSA.O) and Verizon (VZ.N) had both expressed interest in acquiring a significant part of Rupert Murdoch’s Twenty-First Century Fox’s (FOXA.O) assets.

Recovery rally for European stocks as cyclicals make a comeback

European Stock Markets

European shares enjoyed a recovery on Thursday, snapping their longest losing streak since October 2016 as the cyclicals sectors which had driven a market-wide sell-off made a comeback. 

The pan-European STOXX 600 index climbed 0.4 percent, with the cyclicals-heavy DAX .GDAXI up 0.5 percent while Britain's FTSE 100 .FTSE and Italy's top stock index .FTMIB lagged, trading flat.

Financial services, basic resources and technology sectors were among the best-performing, driving the market higher while recovering oil prices also helped support energy stocks.

Investors continued to digest a raft of earnings updates, with all the top movers reacting to results.

French telecoms firm Bouygues (BOUY.PA) led gains, up 3.8 percent after raising its profitability goal for the year, buoyed by a robust 37 percent jump in nine-month operating profits.

London-listed private equity firm 3i Group (III.L) also rose, by 4.2 percent, after results, while shares in postal group Royal Mail (RMG.L) climbed after letter revenues fell less than expected.

Facilities and catering firm Sodexo (EXHO.PA) however fell 4.9 percent as traders expressed disappointment over its margin guidance and annual revenues coming in slightly below consensus forecasts.

The company on Wednesday said it was buying U.S. company Centerplate for $675 million, putting more pressure on its results to impress and justify the expenditure.

Troubled British engineer GKN (GKN.L) sank 5.2 percent, the top faller after it announced a further write-off and ditching CEO designate Kevin Cummings.

Overall the MSCI EMU index of euro zone companies is tracking earnings growth of 10.7 percent in dollar terms for the third quarter, with basic materials, financials and technology the main drivers of earnings beats. The broader MSCI Europe index is delivering 10 percent earnings growth.

Weaker commodities drag European shares to eight-week low; Airbus rallies

European Stock Markets

A fall in commodity stocks and continued profit taking sent European shares to an eight-week low on Wednesday, but Airbus rallied after winning its biggest order. 

Crude oil’s price slide on worries over the outlook for demand and weaker metal prices weighed on mining and energy stocks like Rio Tinto (RIO.L) and Royal Dutch Shell (RDSa.L).

Their falls helped send the pan-European STOXX 600 index down 0.6 percent to its lowest level since Sept. 20.

The index was on track or its seventh session of straight losses, its longest losing streak since October 2016 when markets fell in the run-up to the U.S. presidential elections.

The UK's top share index FTSE 100 .FTSE declined 0.4 percent and Germany's export oriented DAX .GDAXI index fell 0.6 percent, weighed down by a stronger euro

Banks .SX7P were also among the biggest losers, down 1 percent, but falls were spread across sectors as investors continued to take profits following this year’s rally.

The STOXX 600 is still up nearly 6 percent so far this year.

Deutsche Bank strategists led by Sebastian Raedler expect the STOXX 600 to end the year at 395 points, 3 percent above current levels, before falling back to 375 in the first months of 2018

On the earnings front, data from Thomson Reuters IBES data show that 48 percent of companies 

listed on the euro zone MSCI EMU index have beaten analyst expectations while 40 percent have missed them. Earning beats stand at 53 percent for the broader MSCI Europe index and at 72 percent for the U.S.’s S&P 500.

Germany’s Lanxess (LXSG.DE) was among the biggest fallers on the STOXX on Wednesday, down 3.2 percent, after its earnings update did not provide any positive surprise. 

On the positive side, Airbus (AIR.PA) rose 3.4 percent.

Airline pioneer Bill Franke placed a historic order for 430 A320neo-family jets in a deal worth $49.5 billion at list prices that marks a dramatic turnaround for Airbus, which had been lagging behind Boeing in the contest for orders.

The deal is one of the industry’s biggest deals by volume and the most planes sold by Airbus in one batch.

Tesco wins UK regulator's provisional approval for Booker takeover

European Stock Markets

Tesco (TSCO.L) won provisional approval for its 3.7 billion pound ($4.9 billion) takeover of wholesaler Booker (BOK.L) from the UK competition regulator on Tuesday, moving Britain’s biggest retailer closer to securing a new avenue of growth. 

The Competition and Markets Authority (CMA) said it had conducted an in-depth review and provisionally concluded that Tesco’s purchase of Booker does not raise competition concerns.

The provisional unconditional clearance will come as a major relief to Tesco. Most analysts had expected that Tesco would have to agree store disposals to gain clearance.

Both Tesco and Booker, the country’s biggest grocery wholesaler, welcomed the CMA announcement. Tesco said it expected to complete the deal, which also requires shareholder approvals, in early 2018.

Shares in Tesco and Booker were up 4.8 percent and 5.1 percent respectively at 0905 GMT.

Bernstein analysts said they expect some uncertainty to remain, with the focus shifting to whether investors will approve the deal.

Their analysis indicates that Tesco will achieve the required 50 percent shareholder approval and that the focus will be on Booker, where the threshold is 75 percent.

“With a higher shareholder hurdle and the Tesco share price below the level when the bid was made (about 2 pounds), Booker shareholders may argue for a higher share price,” the broker’s analysts said.

For each Booker share, Tesco is offering 0.861 new Tesco shares and 42.6 pence in cash.

The CMA said it found that Tesco as a retailer and Booker as a wholesaler supplying caterers and independent retailers Premier, Londis, Budgens and Family Shopper do not compete head-to-head in most of their activities.

In particular, it found that Tesco does not supply the catering sector that accounts for more than 30 percent of Booker’s sales.

The proposed deal is Tesco Chief Executive Dave Lewis’s boldest move yet. He believes it will provide a new source of growth by giving the group access to the fast-growing “out of home” food market, given Booker’s role as a distributor to the catering industry.

Some Tesco shareholders have criticized the bid, saying Tesco is overpaying and that it will distract from the company’s turnaround plan.

Rival wholesale groups have also called for the takeover to be blocked.