LIVE MARKETS-Closing snapshot: frosty weather, frosty stocks

* STOXX 600 hits 6-mth low, ends down 2.1 pct

* Steelmakers down slightly after Trump tariff plan

March 2 (Reuters) - Welcome to the home for real-time coverage of European equity markets

brought to you by Reuters stocks reporters and anchored today by Danilo Masoni. Reach him on

Messenger to share your thoughts on market moves: danilo.masoni.thomsonreuters.com@reuters.net

CLOSING SNAPSHOT: FROSTY WEATHER, FROSTY STOCKS (1722 GMT)

Hello six-month low, we're back at levels below those reached during the February sell-off.

A mix of concerns over trade wars and jitters around the upcoming Italian election are weighing

on stocks, with the riskier sectors such as basic resources and banks among the biggest fallers.

Not the best start to March (a 3.7 percent loss for the STOXX 600 this week) as uncertainty

is flavour of the day. Plus the weather isn't exactly great here in Europe either.

Have a good weekend - keep warm and enjoy the snow. Here's your closing snapshot:

(Kit Rees)

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THIS IS NO ENTRY POINT... YET (1610 GMT)

Don't just rush in and buy the dip, Amundi (Berlin: 350155.BE - news) 's Chief (Taiwan OTC: 3345.TWO - news) investment officers wrote in a note

published this morning, so a few hours before the STOXX touched new lows.

Further trouble may very well lie ahead, the French asset manager believes.

"We believe it is too early to seize opportunities since the correction has been limited and

incomplete (not affecting the credit market), and it is too early to tell if we are seeing a

regime shift in fundamentals (i.e, structurally higher inflation)".

Amundi argues that valuations are still at high levels and are threatened by rising

inflation.

"In our view, a 3% yield for the 10-year US Treasury is a warning level, and 3.5% is clearly

an alert threshold. If reached too fast, this is unlikely to be sustained without a second wave

of market correction, which cannot be ruled out, in our view."

(Julien Ponthus)

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DEAD CAT BOUNCE? EUROPEAN SHARES FALL BELOW FEBRUARY CORRECTION (1548 GMT)

That's it, what fears of rising interest rates, hasty monetary normalisation or loss of

economic momentum couldn't do on their own, concerns over trade wars just helped do.

The STOXX has fallen below the 367.5 low hit on February 9 during the correction triggered

by higher than expected U.S. wage data a week earlier. The next level to cross is the 366 points

of August 2017.

Here's a cat:

And here's the chart:

(Julien Ponthus)

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BREXIT: FTSE AND POUND BOTH AGREE: NOT IMPRESSED BY MAY'S SPEECH (1458 GMT)

British blue chips and the pound, which rarely trade in the same direction, made an

exception on Friday, both edging down somewhat during Theresa May's Brexit speech.

The moves were not drastic to say the least and it's still not quite clear what to make of

the Prime Minister's vision for the UK's future relations with the EU.

Here are highlights of her speech: and here's our latest story:

(Julien Ponthus)

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KEEPING AN EYE ON OPERATING LEVERAGE (1312 GMT)

This has been singled out as something to watch by UBS (LSE: 0QNR.L - news) strategists, who say that those

sectors with high levels of operating leverage, such as autos, leisure and energy, are beating

earnings expectations.

"Over the past year, we have seen a close relationship between sectors with the strongest

performance/EPS growth and sectors that have the most operating leverage," UBS strategists say

in a note.

"Earnings are coming in stronger than revenues and mostly it is sectors with high

operational leverage, such as Autos and Consumer Durables, that are delivering the net beats,"

UBS adds.

In light of this, UBS have added Cobham (Other OTC: CBHMF - news) and Swatch to their "top stocks" list -- they say

Cobham is a "compelling turnaround story" and they see further upside to Swatch.

(Kit Rees)

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"BEWARE THE IDES OF MARCH" (1250 GMT)

"Beware the ides of March": the soothsayer's warning to Julius Caesar in Shakespeare's

eponymous play seems to be directed to markets today.

Focus has quickly shifted from the Europe's 2017 corporate earnings vintage to political

risks, which are clearly taking back the driving seat.

"Fascinating start to March yesterday," Deutsche Bank (IOB: 0H7D.IL - news) 's strategist Jim Reid said in his note

this morning as "trade wars" headlines suddenly popped up on the screens of investors as Trump

promised to tax steel imports, rocking markets worldwide.

That came as investors were already bracing themselves for "Super Sunday", with an Italian

general election and a "go/no-go" to a "GroKo" coalition in Germany.

Not least, Rabobank noted that Vladimir Putin announcing that Russia's new nuclear weapons

could hit almost any point in the world and evade a U.S.-built missile shield did little to lift

spirits.

"We wonder whether Russian President Putin’s annual state of the nation speech had anything

to do with the ‘risk-off’," the bank's analysts said in a morning note.

Meanwhile later today "UK Prime Minister May gives a speech on the British plan to cut the

EU off from the UK's single market," UBS Wealth Management Chief Economist Paul Donovan noted

with a pinch of irony.

"While this topic is indescribably tedious, this response to the EU's draft divorce deal is

probably important," he said as British equity investors ready themselves for possible heavy

swings on the FX front and likely impacts on the FTSE.

More of that can be expected until EU leaders meet on March 22 and 23 to endorse the bloc's

negotiating position on post-Brexit relations.

A few days before that gathering, a G20 meeting could provide some action, not least because

cryptocurrencies are likely to be on the agenda.

Just in case some investors still felt bullish today, BofA Merrill Lynch issued a cheerful

"6 reasons for another $6tn correction" in its "flow show", noting among factors, protectionism

fears.

Below, Julius Caesar. And here's a link if you forgot what happened to him in March about 20

centuries ago : http://bit.ly/2AlY4fC

(Julien Ponthus)

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EARLY AFTERNOON SNAPSHOT: NOT GETTING BETTER (1230 GMT)

The sell-off in Europe has deepened and just after midday the STOXX 600 is near a fresh day

low and Germany's DAX staying a 6-month lows. Jitters over trade wars are dominating and surely

investors may want to play it safe ahead of votes this Sunday in Italy and Germany that could

spark fresh worries over the political future of Europe, as Brexit talks with the UK continue.

Italy holds a general election with no clear winner in sight, and Germany's SPD party will

announce the result of a member's poll on a deal to renew a "grand coalition" government with

Angela Merkel's conservatives following an inconclusive election last year.

Here's how Peter Rosenstreich, strategist Swissquote (Stuttgart: 1SQ.SG - news) in Geneva, sees it: "If the German

socialists reject Merkel and the Italians pick Berlusconi, we’re in for a wild next week."

In the snapshot you can see where we stand in Europe a couple of hours before Wall Street

opens with futures pointing to declines of nearly 1 percent.

(Danilo Masoni)

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TRUMP TARIFF IMPACT ON U.S. ECONOMY "LIKELY TO BE SMALL" (1019 GMT)

While we're seeing the impact of U.S. President Trump's tariff plan on the European

steelmakers this morning, economists at UBS think that the economic effects on the U.S. itself

are likely to be small.

"Even (Taiwan OTC: 6436.TWO - news) though steel and aluminium are widely used as inputs to production, the total

quantities of imports are small relative to the size of the economy," UBS economists say in a

note.

They add that it might only have a larger effect if other countries retaliate or if they

have under estimated the reliance of the U.S. economy on steel.

But UBS do not believe that these measures are the last.

"Although pressure from congress and some industries where these tariffs are less popular is

likely to build, we believe the Administration is sincere in its effort to use trade policy to

support American industries," UBS economists say.

Here are some charts from UBS showing the countries which are the biggest sources of U.S.

steel and aluminium imports:

(Kit Rees)

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OPENING SNAP SHOT: EUROPE DIPS, STEELMAKERS RETREAT (0820 GMT)

No surprise here, it's Europe's turn to get in the trade war gloomy mood set in Wall Street

and in Asia: most sectors and bourses are down.

No panic among European steelmakers however as you can see below in the Basic Resources (Frankfurt: W8Z.F - news) index

, they are trading in negative territory after Trump's promise to put tariffs on steel

and aluminium imports but nothing spectacular:

(Julien Ponthus)

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WHAT YOU NEED TO KNOW BEFORE EUROPE OPENS (0745 GMT)

Trade war concerns are expected to spill over from Asia to Europe today with main stock

index futures trading down 0.5-0.9 percent. Such losses would put the pan-European STOXX 600

benchmark index on track to end a week already marred by worries over faster interest rate hikes

in U.S. down more than 2 percent.

Shares (Berlin: DI6.BE - news) in global steelmakers listed in Europe such as Tenaris (Amsterdam: TS6.AS - news) , ArcelorMittal (LSE: 0NSF.L - news)

, Outokumpu (LSE: 0FJ8.L - news) and SSAB - which have facilities in the U.S. - will be

in focus after Trump's confirmation of plans for a 25 percent tariff on steel imports. Those

shares rose when the Department of Commerce first announced the measures back in January.

Other steel stocks in focus are Germany's Salzgitter (IOB: 0G77.IL - news) and ThyssenKrupp (Amsterdam: TH6.AS - news) .

Eyes also on aluminium producer Norsk Hydro (LSE: NHY.L - news) .

For the UK markets, Prime Minister Theresa May will set out her vision for a Brexit deal in

a speech, which might impact the pound and the FTSE.

For more stock movers look at the post below with the top European early morning headlines.

(Danilo Masoni)

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EUROPEAN MORNING HEADLINES: STEEL TARIFFS, LAFARGEHOLCIM (LSE: 0QKY.L - news) , GKN (Frankfurt: 694194 - news) , ASOS (0738)

U.S. steel, aluminum stocks jump on tariff announcement

EU promises firm response to U.S. steel tariffs

LafargeHolcim CEO launches overhaul, takes big Q4 charge

GKN says in talks with U.S.-based Dana over auto unit sale

ASOS (LSE: ASC.L - news) finance chief to quit firm

Land Securities Chairwoman Alison Carnwath to step down

Linde (IOB: 0H3X.IL - news) , Praxair (NYSE: PX - news) kick off $8 billion in asset sales- Bloomberg

Elekta AB Q3 profit, orders top forecasts, cuts full-year margin forecast

SAIC, Infineon (Xetra: 623100 - news) form JV to make electric car power modules in China

France's Canal+ suspends broadcasts of TF1 (Paris: FR0000054900 - news) channels in fee feud

Profit at Portugal's EDP sapped by last year's drought

Unions approve Societe Generale (Swiss: 519928.SW - news) 's French retail job cuts plan

Mergers within Renault (LSE: 0NQF.L - news) -Nissan-Mitsubishi (LSE: 7035.L - news) alliance possible but not a goal - Ghosn

LSE Group lifts operating profit 47 pct

Packaging group Mondi (Frankfurt: KYC.F - news) announces special payout as annual profit climbs

Britain's Spire Healthcare (Frankfurt: S00.F - news) 2017 core earnings down 7.4 pct

(Tom Pfeiffer)

*****

FUTURES OPEN LOWER AS FEARS OVER U.S. PROTECTIONISM TAKE THEIR TOLL (0719 GMT)

European bourses are set to open lower as concerns over the United States' possible decision

to impose hefty tariffs on steel and aluminium imports spread from Asia and Wall street.

(Julien Ponthus)

****

US STEEL TARIFFS: WHAT'S NEXT? (0715 GMT)

As we just mentioned, trade tensions are set to spill over to European trading this morning

but what can investors realistically expect to happen next?

Jefferies analysts says Trump's confirmation of plans for a 25 percent tariff on imports is

only a "modest upgrade" to the most aggressive of measures proposed by the DoC in January and

ultimately they expect a more nuanced final policy outcome.

"Mounting pushback from domestic steel consumers and foreign steel suppliers is likely to

lead to a more nuanced final policy outcome... While Trump has full carte blanche to do

essentially whatever he wants with 232, we believe an across the board 25% tariff is politically

unfeasible and will be viewed as a direct tax on U.S consumers," they say.

And for Europe what does the move mean?

"Investors are rightly concerned that steel will be redirected from the US to Europe, but...

should the EC be forced to implement safeguard measures (as last seen in 2002), Section 232, far

from hurting the EU, could force the EC's hand to implement comparably hawkish policies to the

benefit of local mills. And, if the EC ultimately secures relatively open access to the US (as a

core trade/security partner) then Euro steelmakers could benefit from sales into one of the

world's highest priced markets," Jefferies analysts say.

Trump officially has until April 11 announce his final decision.

(Danilo Masoni)

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TRADE TENSIONS SET TO DRAG EUROPEAN SHARES LOWER (0617 GMT)

Good morning. European shares are set to open lower today following losses in Asia and Wall

Street on worries over a possible trade war after President Donald Trump announced the United (Shenzhen: 000925.SZ - news)

States would impose hefty tariffs on steel and aluminium imports.

"25% tariffs on steel and a 10% tariff on aluminium imports has raised concerns of

countermeasures from China and the EU in response and is likely to see European stocks, which

had already been struggling ahead of this weekend's Italian election and important SPD vote in

Germany,... open sharply lower over concerns that costs will rise and profit margins will get

hit sharply," says Michael Hewson, Chief Market Analyst at CMC Markets (LSE: CMCX.L - news) .

Here your morning calls, courtesy of CMC (BSE: CMC.BO - news) .

FTSE100 is expected to open 45 points lower at 7,130

DAX is expected to open 120 points lower at 12,070

CAC40 is expected to open 33 points lower at 5,229

(Danilo Masoni)

*****

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