LIVE MARKETS-Europe at February lows, Mexico standoff hits autos, banks

* European shares open sharply lower

* Autos, miners lead sectoral fallers; banks down

* Trump vows rapid increase in tariffs on Mexico

* China factory activity drops more than expected

* STOXX 600 set for first negative month of 2019

May 31 - 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

EUROPE AT FEBRUARY LOWS, MEXICO STANDOFF HITS AUTOS, BANKS (0737 GMT)

European shares are off to a sharply lower start as the worst month of the year for stocks

draws to an end with investors fretting again over slowing global growth following Trump's

tariff move against Mexico and disappointing data from China.

"Trump is going all out here. The move to start a trade war on another front has shaken

sentiment in an already fragile market," says Jasper Lawler, Head of Research at LCG.

No surprise that autos and miners are leading sectoral fallers, while banks

are also heavily under pressure, as the economic outlook darkens. No sector is trading

in the black.

Among stocks with direct exposure to Mexico are carmakers Volkswagen and Fiat

Chrysler, banks BBVA, Santander and steel firms ArcelorMittal

and Italy's Tenaris. Their shares are falling 1.7-5.2% in early trading.

Here's your opening snapshot:

(Danilo Masoni)

*****

ON OUR RADAR: AUTOS, BANKS, MEXICO-EXPOSED STOCKS (0659 GMT)

Worries over global growth following Trump's tariff move against Mexico and disappointing

factory data from China are set to push European shares down sharply at the open today with

futures in the export oriented German DAX index down more than 1%.

Sectors most exposed to the international economy such as autos and banks will likely suffer

the most with shares in companies with direct business in Mexico such as Germany's Volkswagen

and Spanish bank BBVA falling 2-3% in premarket trade. BBVA derived 37% of

its pretax profit from Mexico in 2018.

Fiat Chrysler, which is in merger talks with Renault, also produces cars in

Mexico. Banks HSBC, Santander and Sabadell also have a presence

there, as well as ArcelorMittal , which produces some steel in Mexico to import into the

US, and Italian pipes maker Tenaris.

Elsewhere, a Reuters report that Amazon is interested in buying a prepaid cellphone service

from T-Mobile and Sprint could lift shares in T-Mobile parent Deutsche Telekom. A

disappointing update from Wizz Air has sent its shares down 2% in pre-market trade,

while in broker moves, traders say a BAML upgrade could lift shares in chipmaker and Amazon

supplier STMicro. BAML downgraded Dialog Semi, traders add.

Monsanto woes continue for Bayer with Los Angeles County suing Monsanto to force it to help

pay for reducing PCB contamination in dozens of bodies of water. Bayer shares seen

down 1-2%. For more headlines check out the previous post.

(Danilo Masoni)

*****

EUROPE FUTURES OPEN DOWN SHARPLY: DAX -1% (0614 GMT)

Fresh worries over a slowdown in global economic growth following Trump's tariff move

against Mexico and the disappointing Chinese data is set to push European shares sharply lower

at the open today. Futures in the trade-sensitive German DAX index are falling more

than 1%, while futures in other country benchmarks are also down sharply.

On the corporate front, merger talks between Fiat Chrysler and Renault

continue to be in focus, while still in M&A, sources said Deutsche Telekom's U.S.

wireless carrier T-Mobile US

spectrum to gain regulatory approval for their merger.

Also interesting is news that Germany will extend for another year a bonus scheme to

encourage people to buy electric cars. Meanwhile Monsanto woes continue for Bayer

with Los Angeles County suing Monsanto to force it help pay for reducing PCB contamination in

dozens of bodies of water.

Here's your futures snapshot and below your early morning headlines roundup.

Nissan's technology could pay in Renault-FCA deal -sources

Fiat says valuation for Renault merger non-negotiable - Les Echos

T-Mobile, Sprint considering divesting wireless spectrum -sources

Germany extends 1.2 bln euro electric car bonus to 2020

Los Angeles County sues Bayer's Monsanto over PCB contamination

Saipem units investigated in Brazil over alleged irregularities

Italy to approve law to make it easier to revoke motorway concessions

Greek banks Alpha, Eurobank report fall in quarterly profit

Logitech moving some manufacturing out of China amid trade conflict

Packaging firm Aluflexpack to Zurich launch IPO next week

Legal & General to sell general insurance unit to Allianz

(Danilo Masoni)

*****

EUROPE SEEN LOWER AFTER AS TRUMP TARIFFS TARGET MEXICO (0532 GMT)

European shares are expected to open lower this morning on renewed trade tension after U.S.

President Donald Trump said the Washington would impose a new tariff on all imports from Mexico

next month until illegal immigration is stopped.

Data from China showing that factory activity in May slumped into a deeper contraction than

markets had expected is also set to weigh today.

Financial spreadbetters expect London's FTSE to open 26 points lower at 7,192, Germany's DAX

to fall 81 points to 11,821, and France's CAC to fall 29 points to 5,220, a trader says.

Over in Asia, U.S. stock futures slid and sovereign bonds surged on Friday as investors

feared Trump's shock move to slap tariffs on Mexico risked tipping the United States into

recession. Month-end bargain hunting helped MSCI's broadest index of Asia-Pacific shares outside

Japan rise 0.3%.

The pan-European STOXX 600 index edged up 0.4% in the previous session but is

firmly on track to suffer its first negative month of 2019, having fallen nearly 5 percent so

far this month with heightened trade tensions fuelling worries over slowing economic growth.

(Danilo Masoni)

*****