February 22, 2018 / 1:08 PM / 7 months ago

LIVE MARKETS-European stocks shrug off ECB minutes

    * Investors price in more Fed tightening after minutes
    * European stocks open lower
    * Earnings season in full swing in Europe

    Feb 22 (Reuters) - Welcome to the home for real-time coverage of European equity markets
brought to you by Reuters stocks reporters and anchored today by Julien Ponthus. Reach him on
Messenger to share your thoughts on market moves: julien.ponthus.thomsonreuters.com@reuters.net
    
    
    EUROPEAN STOCKS SHRUG OFF ECB MINUTES (1303 GMT)
    The euro might have spiked briefly immediately after the release of the ECB minutes, but
there was nothing as exciting among European stocks - the STOXX 600 remains where it was, down
0.6 percent.
    The minutes showed that ECB policymakers felt it was too early to change their communication
stance to signal a normalisation of policy.
    Here's Capital Economics' takeaway from the minutes:
    "The account of the ECB’s January meeting suggests that the Bank will drop the easing bias
from its policy statement as soon as the next meeting on 8th March, but gives few signals as to
when asset purchases will end."
    Also of note in the minutes were comments around the euro's appreciation and the drivers
behind that:
    "Although the past appreciation of the euro had so far had no significant negative impact on
euro area external demand, volatility in foreign exchange markets represented a further risk
that needed monitoring."    
    (Kit Rees)
    *****
    
    BEFORE ECB MINUTES, STOXX DRIFTS SLIGHTLY LOWER (1151)
    European shares are retreating slightly with the STOXX 600 down 0.7 percent at
around lunchtime. Here's how the main regional indexes look just ahead of the release of the ECB
minutes which are unlikely to grab the same interest of those the Fed released yesterday.    
 
    (Danilo Masoni)
    *****
     
    
    LOOKING FOR SIGNS OF HOPE IN THE BANKING SECTOR (0923 GMT)
    Though the broader European banking index may be down around 0.7 percent, results
from Barclays and Belgium-based KBC Groep are helping stem losses.
    It seems that investors have been looking for capital returns from the banks - HBSC's
 shares dropped after there was no mention of a share buyback earlier this week, whereas
Lloyds gained yesterday after announcing a buyback of up to 1 billion pounds.
    And today analysts are pointing to Barclays promising to restore its full dividend.

    "Full-year dividend back to 6.5p next year and talk of buybacks should have investors
purring with delight even though a series of one-off charges meant Barclays slid to a loss in
2017," Neil Wilson, senior market analyst at ETX Capital, said in a note.
    Interestingly while analysts at Investec described Barclays' results as "fairly awful", they
also think that the outlook has improved thanks to the aforementioned dividend payment
intentions and a better-than-expected performance in Barclays' investment banking division.
    Moreover, higher interest rates in the U.S. should also benefit the sector more broadly.
    While Barclays' shares lost more than 9 percent last year, so far they have gained around
4.7 percent in 2018.  
    (Kit Rees)
    *****
    
    OPENING SNAPSHOT: EUROPEAN SHARES PULL BACK (0820 GMT)
    Europe has opened, and fallen. There seem to be a number of drivers: yields on 10-year U.S.
treasuries are fast approaching 3 percent (a level now crossed by the 30-year) after the Fed's
latest policy minutes, which in turn is hitting the equity market. 
    Not surprising then, that the biggest sectoral losers early on are the "bond proxies" -
consumer staples and telecoms. 
    Throw into the mix a number of not-so-well-received results from the likes of
Moneysupermarket.com (-19 pct), Ingenico (-12 pct) and Playtech (-8
pct) as well as several FTSE big-hitters going ex-div and you can see why the mood is pretty
downcast.
    Here's your opening snapshot:
    
 
    (Kit Rees)
    *****
    
    EUROPEAN HEADLINES: MORNING ROUND-UP (0749 GMT)
    Earnings season is in full swing and the flurry of publications today is offering precious
indications as to whether Q4 was indeed a strong vintage. Clues are expected on the health of
sectors which have suffered recently, such as telecoms, utilities or consumer staples but also
areas where optimism has risen yesterday, such as banks, thanks to Lloyds, and miners with
Glencore.   

Barclays grows annual profit by 10 percent, restores dividend 
ProSiebenSat.1 sells stake in digital business to General Atlantic 
Henkel gives cautious outlook after beauty decline 
Deutsche Telekom hikes dividend despite record investment  
Nestle in talks to end supermarket row as pricing pressures build 
Spain's Telefonica reports 23 pct rise in core profit in Q4 
Insurer AXA's 2017 profit rises ahead of planned IPO of U.S. business 
Novo Nordisk gets nod from U.S. drug purchaser for new diabetes hope 
Utility Veolia 2017 core earnings up 2 pct, says 2018 started strongly 
BAE Systems posts 8 percent rise in annual earnings 
Serco meets forecasts and reiterates outlook despite "bumpy road" 
RSA posts above-forecast 663 mln stg op profit in 2017 
Anglo reports 45 percent leap in earnings, cuts debt 
British American sales, profit helped by Reynolds deal  
KBC net profit ahead of consensus on Czech gains 
French conglomerate Bouygues' 2017 profits beat expectations 
Arkema beats 2017 profit target on strong units growth 
UCB full-year core profit beats expectations, cautious about 2018  
Safran sees quick ramp-up of Mexico composite fan blade plant  
Italy competition watchdog extends broadband probe into Telecom Italia 
Pipe maker Vallourec cautious after beating 2017 profit forecasts 
Britain's Centrica posts 17.4 pct fall in FY profit
BRIEF-ISS FY 2017 Net results at DKK 2.42 Bln
EUROPE RESEARCH ROUNDUP-Aurubis, Dunelm Group, Fortum Oyj 
    
    (Julien Ponthus, Tom Pfeiffer)
    *****

    
    EYES ON THE DATA (0740 GMT)
    Nerves have cooled a little since the sell-off earlier this month, but investors will be
watching the flurry of economic data today for any sign that this is as good as it gets in terms
of economic momentum in Europe.
    Yesterday's PMIs showed that, while business growth remains robust, it has slipped slightly
from January's peak.
    "The data is in line with our expectations of European growth peaking in Q1, but the
still-elevated survey levels continue to support our above-consensus 2018 growth forecast and
our preference for European stocks on a three- to six-month horizon," analysts at Credit
Suisse's Wealth Management division said in a note. 
    From the chart below, you can see how the euro zone's Euro Stoxx Index has tracked
a rise in PMI readings, suggesting that an economic expansion has been filtering through into
optimism around the region's equities.
    
 
    (Kit Rees)
    *****
    
    DOWN IT IS (0735 GMT) 
    Futures are confirming earlier financial spreadbetters indications: European bourses are set
to slump at the open and follow the downward trend from Wall Street and Asia. With so many
companies reporting results today, however, the old continent may find a trend of its own.  
      
 
    (Julien Ponthus)
    *****     
    
    
    EARNINGS AND INDICATORS GALORE (0639 GMT) 
    For those who may be experiencing U.S. rates and inflation fears fatigue, there will be
plenty of indicators and corporate news to animate the session in Europe today. 
    We're expecting, among other business climate for Germany, France and Belgium, CPI data from
France and Italy and industrial orders from Switzerland and Italy. 
    In terms of earnings, the season is in full swing as you can see below in this
non-exhaustive but still very long list below:
    Aeroports de Paris SA FY 2017 Earnings Release
    Anglo American PLC Earnings Release
    Arkema SA FY 2017 Earnings Release
    AXA SA FY 2017 Earnings Release
    BAE Sys FY 2017 Earnings Release
    Barclays PLC FY 2017 Earnings Release
    Bouygues SA FY 2017 Earnings Release
    British American Tobacco PLC FY 2017 Earnings Release
    Centrica PLC Preliminary 2017 Earnings Release
    CNP Assurances SA FY 2017 Earnings Release
    Saint Gobain SA FY 2017 Earnings Release
    Constellium NV Q4 2017 Earnings Call
    Deutsche Telekom AG Q4 2017 Earnings Release 
    DIA FY 2017 Earnings Release
    Fnac Darty SA FY 2017 Earnings Call
    Gecina SA FY 2017 Earnings Call
    Henkel AG & Co KgaA FY 2017 Earnings Release
    Ingenico Group SA FY 2017 Earnings Call
    KBC Groep NV Q4 2017 Earnings Release
    Nyrstar NV FY 2017 Earnings Release
    Prosiebensat 1 Media SE FY 2017 Earnings Release
    Scor SE FY 2017 Earnings Release
    Serco Group PLC FY 2017 Earnings Call
    TBC Bank Group PLC HY 2018 Earnings Call
    Technip Earnings Call
    Telefonica FY 2017 Earnings Release
    UCB Q4 2017 Earnings Release
    Valeo SA FY 2017 Earnings Call
    Veolia Environnement SA FY 2017 Earnings Release
    (Julien Ponthus) 
    ****
   
    MORNING CALL: EUROPEAN BOURSES SET TO RETREAT (0615 GMT)  
    Good morning and welcome to Live Markets.
    European bourses seem set to follow Wall Street and their Asian peers lower this morning as
speculation of faster hikes in U.S interest rates soured risk appetite globally.     
    Spreadbetters expect Germany's DAX to open 134 points lower, France's CAC 50 points lower
and Britain's FTSE 100 82 points lower.
    (Julien Ponthus)
    ****

    
 (Reporting by Danilo Masoni, Helen Reid, Kit Rees and Julien Ponthus)
  
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