LIVE MARKETS-Will Farage move sterling? All eyes on the Brexit Party!

* European stocks fall after positive open * Reported China doubts about trade deal offset Fed rate cut * Fiat jumps, Peugeot drops after they officially announce 50-50 merger * Eutelsat down 12% after weak results 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: rm://julien.ponthus.thomsonreuters.com@reuters.net WILL FARAGE MOVE STERLING? ALL EYES ON THE BREXIT PARTY! (1105 GMT) Seriously? Yep, seriously. Even though the Brexit Party is expected to win only a few seats at the December 12 general election, their electoral strategy could actually move the pound tomorrow. The reason forex traders, FTSE 100 and FTSE 250 aficionados will monitor the launch of the campaign of the party, who favour a clean break with the EU, is that their choice of strategy might be one of the keys of the vote. There's speculation that Nigel Farage's party might decide to concentrate its efforts in only a handful of constituencies instead of running in all of the countries' 650. That could be a big relief for Boris Johnson and his Conservative Party which could be threatened by Brexit die-hards in the regions which overwhelmingly voted "Leave" during the 2016 referendum. "If true this would take some of tail risk out of the election and reduce the no-deal risk", reckoned DB's Jim Reid in his morning note. Same analysis for Nomura's Jordan Rochester. "If the Brexit party runs in just a few seats, it’s short term +ve for GBP (...) Any headline suggesting the Brexit party will be more selective will be a short term boost for GBP as it will increase the odds of the Conservatives winning a majority". The Brexit Party campaign launch is scheduled for 10h30 GMT. And here a message from Farage taken from the Brexit Party's website: (Julien Ponthus and Alistair Smout) ***** BARGAIN HUNTING IN LONDON: "TACTICAL PAUSE" (1137 GMT) Credit Suisse strategists led by Andrew Garthwaite say investors in cheap UK stocks could start to worry about a couple of things: 1) election uncertainty (in 2017, the Conservative lead over Labour fell by 15 points over the election campaign compared to a 10% Conservative lead over Labour currently) and 2) the future trading arrangement between the EU and UK (Canada+ would have almost the same economic impact as a no deal Brexit, according to a number of independent studies) This essentially means near-term risks of pull-back and even though they remain overweight over a longer time frame, they advise taking a "tactical pause". That being said, they number 5 reasons to be overweight over a 6 to 12-month view: 65% chance of a Conservative government; Brexit transitional period is likely to be extended significantly beyond December 2020; valuations of UK equities remain at a 20-year low; risk appetite is depressed; fiscal easing of 1.5% of GDP will support UK growth and sterling. (Danilo Masoni) ***** TRADE WAR JITTER KILLS FED CUT FEEL-GOOD VIBES (1014 GMT) Boom! And it's gone! The Fed feel-good vibes which were lifting markets since the cut was announced yesterday are gone, shot down by the news conveyed by this snap: European benchmarks and Wall Street futures fell abruptly as our main competitor reported that Chinese officials have their doubts about a comprehensive long-term trade deal with Trump. Asked to comment on the following drop on the STOXX, Stephane Barbier de la Serre at Makor said he wasn't surprise at all given the current high levels at which markets are trading. "A reality check can come at any time", he said, arguing that while monetary stimulus was keeping markets afloat, there was a structural lack of other good news to justify current valuation levels. In this context, one could argue, any excuse for some profit taking will do. You can see below S&P futures taking a hit: (Julien Ponthus) ***** PSA AND FIAT CHRYSLER STEAL THE SHOW, AGAIN (0757 GMT) Let's get directly to the point, PSA and Fiat Chrysler really stole the limelight this morning at the open with traders operating a spectacular and brutal arbitrage between the bride and groom's respective shares. The French car maker is taking an 8% hit while Fiat Chrysler is surging over 9%. In a nutshell, buy Fiat Chrysler, sell Peugeot. What did look as a classic "buy-the-rumour sell-the-news" seems to a violent adjustment on the terms of the 50-50 share swap merger. As part of the deal, FCA will pay its shareholders a 5.5 billion euro special dividend and hand them shares in its robot-making unit Comau. PSA on its part will distribute its 46% in automotive equipment maker Faurecia to its shareholders. "On balance the terms of the deal favours existing FCA shareholders (who benefit from a cash distribution equivalent to 30% of the market cap), while Groupe PSA shareholders are being asked to remain patient," Citi analysts said. Both companies are selling the deal as a merger of equals but all the grown-ups in the room know that there is no such thing. Thinking about it, it seems the market is actually giving its live version of what "equals" mean: Peugeot down, Fiat up! Very cute to see that the two car makers are nevertheless holding hands among top STOXX 600 movers. You would not guess looking at the main benchmarks, the STOXX 600 is currently flat, but there are a flurry of other very sharp moves. Eutelsat is down 12%, ASM up 8.6%, Air France KLM down 4.5%, all of which after their trading update. (Julien Ponthus) ***** A DECENT BATCH OF EARNINGS ON THE FACE OF IT (0725 GMT) Futures for the main European benchmarks are all trading in positive territory and by the face of it, today's batch of Q3 results turns out to be a decent bag of earnings with quite a few beats. The only big disappointment at the moment looks to be Air France KLM, which is called down 4% by one trader. As a bonus, we have PSA and Fiat Chrysler making it official: they are getting engaged, whether they make it to the actual wedding is another matter. Talking about French M&A, there's a report saying shareholder activist Elliott opposes Capgemini's takeover terms for Altran. Here are this morning's big headlines: BNP Paribas quarterly profit falls less than expected BBVA Q3 net profit down 31% but beats forecasts ING reports 3Q underlying pretax profits of 1.91 bln euros as costs rise Lloyds profits miss expectations after fresh $2.3 bln mis-selling hit Spain's Caixabank Q3 net profit rises 37%, NII flat Zalando reports faster quarterly sales growth France-KLM sees slowing travel demand in tail-end of 2019 Carlsberg agrees to buy out Cambodian brewery, posts upbeat Q3 sales Aerospace supplier Safran maintains full-year outlook as Q3 sales rise Delivery Hero ups 2019 revenue guidance thanks to strong order volumes Oil firm DNO swings to Q3 loss amid writedowns (Julien Ponthus) ***** FED CUTS, S&P SOARS, Q3S MARCH ON, BEWARE THE FOMO (0535 GMT) Even though it was widely expected, the Fed cut sent some feel-good vibes from the U.S. to Asia and there just isn't any reason why Europe shouldn't get its fair share of the love. Except for one thing: we're in the thick of a Q3 earnings season which is stubbornly exposing a clear cut corporate recession. So while Financial spreadbetters expect Frankfurt and Paris to open just slightly higher, there's no ruling out that the mood could sour quickly if today's big earnings batch doesn't meet expectations. Given that the S&P is hitting record highs, it would be perfectly acceptable for European investors to be hit by a gasp of fomo (fear of missing out) if today's results disappoint. Let's see in 90 minutes how it pans out. (Julien Ponthus) ***** (Reporting by Danilo Masoni, Joice Alves, Julien Ponthus and Thyagaraju Adinarayan)