LIVE MARKETS-Europe on track for bounceback as euro optimism returns
May 28 - 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
EUROPE ON TRACK FOR BOUNCEBACK AS EURO OPTIMISM RETURNS (0615 GMT)
It looks like European stock markets are set for a bounceback today after Spanish and
Italian political turmoil dented performance on Friday.
If there is going to be stress from Italy, it'll be relatively contained - and some
investors are even calling for a bounce on relief that the anti-establishment government won't
materialise. Indeed Italian bond yields are falling back after the parties abandoned plans to
form a government.
Renewed optimism over a U.S.-North Korea summit is likely to also be helping boost European
futures this morning, while the euro - the barometer of investors' confidence in the euro zone -
has rallied half a percent, after hitting a low.
Futures are up 0.3 to 0.6 percent. Here's your snapshot:
(Helen Reid)
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EARLY MORNING HEADLINE ROUND-UP (0557 GMT)
Here's this morning's harvest of corporate, M&A and political headlines to digest, including
Swiss Re (LSE: 0QL6.L - news) and SoftBank (Swiss: SOFB.SW - news) ending talks about a potential minority investment.
Daimler (IOB: 0NXX.IL - news) faces scrutiny of 120,000 Vito, C-Class diesels -BamS
Deutsche Post (IOB: 0H3Q.IL - news) considers raising price for letter postage -report
Fiat Chrysler recalls 5.3 mln vehicles for cruise control defect
Smiths Group (Frankfurt: QS2A.F - news) , ICU Medical (Frankfurt: 894139 - news) in talks about medical division merger
Audi CEO says diesel crisis not over and vows to stay on - report
Enel (LSE: 0NRE.L - news) in advanced talks with Russia's Melnichenko over Reftinskaya coal plant sale - sources
LafargeHolcim (LSE: 0QKY.L - news) to close Paris, Zurich head offices, axing 200 jobs
Veolia CEO sees opportunities in China from Beijing's waste crackdown
Gemalto Announces Collaboration With Qualcomm Technologies
Swiss Re, SoftBank pull plug on talks about minority stake
Italy's president calls in former IMF official amid political turmoil
Italy's efforts to form govt fail as president defends euro
(Helen Reid)
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ITALY: NEW ELECTIONS ON THE HORIZON? (0553 GMT)
Italy's efforts to form a government have failed after the President vetoed the two
anti-establishment parties' pick for economy minister - and early elections are looking
inevitable.
"President Mattarella has announced he is going to meet with Mr Carlo Cottarelli, former
head of the Fiscal Affairs Department at the IMF tomorrow," writes Goldman Sachs (NYSE: GS-PB - news) ' senior
economist Silvia Ardagna in a note late last night.
"Most likely, President Mattarella will grant Mr Cottarelli a mandate to form a caretaker
government, in our view, as the various attempts to form a conventional government have failed."
She (Munich: SOQ.MU - news) doesn't expect a caretaker government to win a confidence vote in Parliament, and says
new elections could take place "as early as October".
Societe Generale (Swiss: 519928.SW - news) analysts say "most political parties have said they will not support such a
government and want elections soon, maybe in September". A general election has never been held
over the summer period, so the prospect of an "extended hiatus in power" looms, they add.
The new election campaign could also become a referendum on a euro, and there's a likelihood
that an even more radical government will be brought in, SocGen (Paris: FR0000130809 - news) notes, making it a volatile
environment for investors.
(Helen Reid)
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MORNING CALL: EUROPEAN STOCKS SEEN RISING AS EURO SLIDES ON ITALY RISK (0526 GMT)
Italian political risk is likely to loom large again today in European trading after the
President rejected 5-Star and League's choice for economy minister, Paolo Savona, a eurosceptic.
The euro hit a 6 1/2 month low late on Friday but is bouncing back in early trading. The
currency's drop is still likely to give a boost to euro zone stock markets, while Italian stocks
could still see choppy trading after a fragile Friday.
Overnight U.S. oil futures hit six-week lows on expectations major producers may ease
production cuts, which could weigh on European commodities stocks. Overall Asian markets gained
on further signs the U.S. and North Korea were still working towards holding a summit.
UK stock markets are closed for trading today due to a bank holiday, but euro zone
benchmarks are seen rising.
Spreadbetters call the DAX 36 points higher at 12,974 and the CAC 40 up 2 points at 5,545.
(Helen Reid)
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(Reporting by Danilo Masoni, Helen Reid, Kit Rees and Julien Ponthus)