Advertisement
UK markets closed
  • NIKKEI 225

    40,168.07
    -594.66 (-1.46%)
     
  • HANG SENG

    16,541.42
    +148.58 (+0.91%)
     
  • CRUDE OIL

    83.11
    -0.06 (-0.07%)
     
  • GOLD FUTURES

    2,254.80
    +16.40 (+0.73%)
     
  • DOW

    39,807.37
    +47.29 (+0.12%)
     
  • Bitcoin GBP

    56,127.00
    +1,186.41 (+2.16%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • NASDAQ Composite

    16,379.46
    -20.06 (-0.12%)
     
  • UK FTSE All Share

    4,338.05
    +12.12 (+0.28%)
     

LIVE MARKETS-Japan, here I come!

* European shares open higher: STOXX 600 +0.7%

* China and US 'very close' to initial trade deal - Global Times

* LVMH agrees $16.2 bln deal for Tiffany; Novartis to buy U.S. biotech firm

* Asia shares find footing as mood swings on trade 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

JAPAN, HERE I COME! (1149 GMT)

I crave for some sushi as we're approaching (early) lunch time - okay that's not the newsy part of this blog - but how the sushi land has outperformed every other major DM index since August (chart).

ADVERTISEMENT

Japan's Nikkei has risen more than 7% since early August while the rest of the developed world rose 4%-5%, and there is some anecdotal evidence to the increased interest in Japanese stocks.

In Morgan Stanley's APAC investment summit, the bank had several investors saying they are warming up to Japan and that they are finding some of the best single stock opportunities in the country.

"Historically, Japan has been a macro story based on one’s view on the currency and fiscal impulse. This more micro/bottom-up mindset is a change," Morgan Stanley's Michael Wilson says.

(Thyagaraju Adinarayan)

*****

OPENING SNAPSHOT: SEA OF GREEN (0820 GMT)

Trade optimism and some big M&A deals have inevitably resulted in a typical risk-on start: gains are broad-based with trade-sensitive, cyclicals and commodity-exposed sectors taking the lead and helping lift the STOXX 600 0.7% powering the pan-European index above 400 points.

LVMH is up a healthy 1.4% after the French luxury goods group agreed to buy Tiffany & Co for $16.2 billion, while Novartis rose as much as 0.5% at the start after a U.S. takeover announcement. Its shares have cooled down a bit, last trading flat.

Top STOXX gainer is cable maker Prysmian, up 4% after its troubled Western Link high voltage connection was taken over by clients.

Here's your opening snapshot, which, as you can see, is a sea of green:

(Danilo Masoni)

*****

WHAT YOU NEED TO KNOW AT THE OPEN (0752 GMT)

The positive noise on trade talks and big transatlantic M&A activity in luxury and healthcare are set to dominate the session in Europe today with stock futures pointing to solid gains at the start, up as much as 0.7%.

Luxury stocks will be on the watch-list after LVMH reached a definitive agreement to buy U.S. jewellery chain Tiffany & Co in a $16.2 billion deal that is the largest takeover ever the acquisitive French group. One trader sees LVMH and the whole sector rising as much as 2% at the open.

Meantime, Novartis agreed to buy U.S. biotechnology company The Medicines Co for about $9.7 billion, as it seeks to expand its portfolio of medicines against cardiovascular disease. Novartis shares however were down 3.2% in premarket trade.

Elsewhere more deal-making is taking place.

Debt-ridden telecoms company Altice said it would buy French fibre wholesale operator Covage for around 1 billion euros, while freshly privatised French lottery operator FDJ agreed to buy software publisher Bimedia.

Shares in Prysmian are expected to get a nice boost (up 3-10%) after its troubled Western Link high voltage connection was taken over by clients.

Eyes also on Italian toll road operator SIAS after a bridge on one of its highways collapsed on Sunday following a massive landslide. No casualties were reported.

The renewed optimism over trade is likely to support trade-sensitive sectors like autos.

Other stock movers: AMS shareholder Temasek backs plans for Osram takeover; Just Eat advises shareholders not to accept Prosus offer ; Sika to buy Romanian mortar maker Adeplast; UniCredit confirms talks with Koc over Turkey JV; French property group Icade raises net current cash flow guidance for 2019

(Danilo Masoni)

*****

TRANSATLANTIC M&A ACTIVITY ON OUR RADAR (0647 GMT)

Turning to the corporate news front there are a couple of transatlantic M&A deals that will likley steal the show this morning.

Sources said on Sunday that LVMH was close to buying U.S. jewellery chain Tiffany & Co for about $16.3 billion after sweetening its offer, in a deal that could be announced today.

Also on Sunday, Novartis said it was buying U.S. biotechnology company The Medicines Co for about $9.7 billion.

Elsewhere, some minor dealmaking is taking place:

French lottery group FDJ buys software company Bimedia

Sika to buy Romanian mortar maker Adeplast

(Danilo Masoni)

*****

MORNING CALL: UP ON POSITIVE TRADE NOISE (0632 GMT)

European shares are expected to open higher this morning following gains in Asia overnight on renewed optimism over a possible trade deal.

Spreadbetters at IG expect London's FTSE to open 24 points higher at 7,351, Frankfurt's DAX to open 74 points higher at 13,238 and Paris' CAC to open 25 points higher at 5,919.

A U.S. official said over the weekend that an initial trade agreement with China was still possible by the end of the year after Chinese President Xi Jinping and U.S. President Donald Trump both underscored their desire on Friday to sign a deal.

Meantime, the Global Times said earlier today that China and the United States were 'very close' to a phase one trade deal.

Later in the day, the German IFO business survey will be watched, while dealmaking is also likely to be a focus after sources said LVMH is close to buying U.S. jewellery chain Tiffany & Co for about $16.3 billion after sweetening its offer.

(Danilo Masoni)

*****

(Reporting by Danilo Masoni, Joice Alves, Julien Ponthus and Thyagaraju Adinarayan)