LIVE MARKETS-Euro zone GDP: fleeting weakness?

May 2 - Welcome to the home for real-time coverage of European equity markets brought to you

by Reuters stocks reporters and anchored today by Helen Reid. Reach her on Messenger to share

your thoughts on market moves: helen.reid.thomsonreuters.com@reuters.net

EURO ZONE GDP: FLEETING WEAKNESS? (0955 GMT)

"The slowdown in the first quarter was exacerbated by temporary factors that muddy the

underlying picture," say Oxford Economics analysts, after Q1 euro zone GDP figures came out as

expected, up 0.4 percent compared to the previous quarter and up 2.5 percent year-on-year.

Stocks didn't have much immediate reaction to the figures which were bang in-line with

consensus expectations sticking to day's highs of +0.6 percent, as analysts emphasised weak

growth was likely fleeting.

"The question is whether this is just a blip or the beginning of a more pronounced cyclical

slowdown. The truth probably lies somewhere in between," writes Berenberg economist Florian

Hense.

After the euro zone enjoyed its strongest growth in a decade in 2017, some moderation was

expected, investors say, and many are sticking to their positive views on European stocks.

Both Oxford Economics and Berenberg expect some bounce back in the next quarter from the

special factors hitting first-quarter output, and as trade tensions ease somewhat.

(Helen Reid)

*****

ITALIAN STOCKS BREAK KEY RESISTANCE. FURTHER TO GO? (0944 GMT)

It looks like Italy will not hold early elections next month and investors like that,

further squeezing government bond yields and pushing the country's blue chip FTSE MIB

index above a key milestone which could prelude to further gains.

As you can see in the snapshot the FTSE MIB index has hit its highest level since October

2009, breaking a strong resistance, after a presidential palace source said President Sergio

Mattarella has ruled out the possibility of early elections in June, preferring instead to have

a new government in place to pass the 2019 budget.

"Everything that rules out a pure populist government and paves the way for something more

institutional that approves the budget is seen positively," a trader at a European bank says.

"The resistance (that has been broken) was solid and, if the European market allows for

that, there is room for more gains," he adds.

Earnings may also be giving a helping hand.

"Italy has delivered the strongest Q1 EPS growth so far, at 44 percent, but this is expected

to slow somewhat next quarter," says Deutsche Bank (IOB: 0H7D.IL - news) .

(Danilo Masoni)

*****

MORNING SNAPSHOT: INMARSAT (Other OTC: IMASF - news) , APPLE SUPPLIERS IN THE SPOTLIGHT (0753 GMT)

It's a strong start to European trading with the STOXX at its highest since Feb 5, boosted

by basic resource stocks (after strong factory data from China) and tech after Apple (NasdaqGS: AAPL - news) 's results

with iPhone sales coming in better than expected.

Apple's Germany-listed shares are up 5.9 percent in early deals, while iPhone supplier ams

is up 7.7 percent, with other chipmakers STMicro, Infineon (Xetra: 623100 - news) , BE Semiconductor, up 2.8 to 3.6

percent.

Inmarsat is also shooting up 10.2 percent after its revenues rose, and Lundin Petroleum (LSE: 0NNR.L - news) is

getting a 4.1 percent boost from strong results, continuing the trend among oil companies.

Energy stocks are providing the main boost to earnings, Deutsche Bank strategists say.

(Helen Reid)

*****

WHAT'S ON THE RADAR FOR THE EUROPEAN OPEN (0644 GMT)

Futures are pointing to a slightly positive open but nothing extravagant really despite

Apple’s strong results. One pre-market indication sees ams and the Apple supply chain rising on

these results.

The earnings season is still on in Europe and we have possible movers in a broad range of

sectors today:

Standard Chartered (BSE: 580001.BO - news) posted a better-than-expected 20 percent rise in pretax profit. Still in

the banking sector RBS’s job cuts and closure of branches could also have an impact. At

Barclays (LSE: BARC.L - news) , the chairman said he was not leaving the bank and that shareholders are backing the

CEO under a misconduct enquiry.

In the pharmaceutical sector, Denmark's Novo Nordisk (LSE: 0QIU.L - news) reported a posted first-quarter

operating profit above expectations and lifted the lower end of its 2018 sales and profit

outlook. Its shares are indicated up 2 to 3 percent.

In the luxury sector: Hugo Boss (IOB: 0Q8F.IL - news) strong sales growth in china and the US

In retail, watch for Ocado which signed a partnership deal with Sweden’s ICA, past deals

like this triggered sharp price moves and the shares are indicated up 2 to 5 percent in

pre-market calls.

Another positive earnings report in the energy sector with Swedish oil firm Lundin Petroleum

saying earnings were above forecast.

In basic materials Glencore (Frankfurt: 8GC.F - news) won a temporary injunction over alleged unpaid royalties, which

could boost the stock after the news made it fall sharply on Monday.

Yet more headlines showing how divided the UK government is about Brexit could also weigh on

the pound and possibly ease pressure on the FTSE. Data showing UK shop prices falling this

morning also furthers the case for no rate hike next week.

And of course euro zone GDP data out at 0900 GMT will be keenly watched for further signs of

slowing in the region's strong economic growth.

(Julien Ponthus)

*****

EUROPEAN FUTURES JUST SLIGHTLY UP (0710 GMT)

European futures have opened in slightly positive territory, but nothing extravagant as the

highest rise is for the FTSE with a 0.4 percent but the IBEX and CAC are flat.

Earlier indications from financial spreadbetters gave London 20 points higher, Frankfurt's

DAX to open 36 points lower and Paris 26 points lower.

(Julien Ponthus)

*****