LIVE MARKETS-M&A in U.S. tech running at full dot-com bubble speed
April 19 - 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
M&A IN U.S. TECH RUNNING AT FULL DOT-COM BUBBLE SPEED (0915 GMT)
With (Other OTC: WWTH - news) so many strategists calling for caution on the U.S. tech sector, it's hard to tell
whether M&A running at full pre dot-com bubble speed is a sign of good health or a rather
sinister omen.
Anyhow, Thomson Reuters (Dusseldorf: TOC.DU - news) research shows that M&A activity in the U.S. is at its highest level
since the 2001 tech bubble burst. Have a look:
Following the Facebook (NasdaqGS: FB - news) /Cambridge Analytica scandal, a growing number of analysts have warned
investors that the sector could face a wave of regulation similar in scale to the post-financial
crisis banking regulations and even perhaps in the magnitude of the anti-monopoly drive which
restructured the U.S. economy at the beginning of the 20th century.
Here's what Saxo Bank told its clients in its outlook for Q2:
(Julien Ponthus)
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OPENING SNAPSHOT: EUROPE MIXED AS EARNINGS DOMINATE, MINERS RISE (0710)
Main European stock indexes are off to a mixed start, although moves are small in both
direction, as investors go through a jungle of earnings updates.
Further gains in mining stocks, as metal and oil prices hit new peaks, however is providing
support.
Here's your opening snapshot:
(Danilo Masoni)
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WHAT'S ON THE RADAR FOR EUROPEAN STOCKS (0649 GMT)
Earnings take centre stage today as futures point to a positive open, with stellar gains in
commodities stocks likely to keep driving the market up after crude prices hit new late-2014
highs overnight and aluminium and nickel prices continued to surge.
The earnings season is gathering pace with consumer giants Nestle (Swiss: NESN.VX - news) and Unilever (NYSE: UL - news) reporting,
both confirming their 2018 outlook and indicated up 1 percent in pre-markets.
Investors are particularly watching currency movements this season, and some companies will
have been under strain due to the strong euro.
M&A news will also move stocks: Merck KGaA (LSE: 0O14.L - news) ’s shares are seen gaining 2 to 3 percent after
Procter & Gamble (Swiss: PG-USD.SW - news) agreed to acquire its consumer health business for around 3.4 billion euros.
Weir Group (Other OTC: WEIGY - news) is indicated down 3 to 4 percent, however, after announcing a $1.28 billion deal to
acquire Esco Corporation.
A difficult season for UK retail continues with Debenhams (Frankfurt: D2T.F - news) indicated down 10 percent after
warning on its outlook and cutting its dividend. Ultra Electronics (Frankfurt: 909716 - news) was also seen falling 10
percent by some traders after saying it was being investigated by the SFO for suspected
corruption in Algeria.
Some extra headlines to watch:
Unilever stands by outlook after Q1 meets expectations
Ultra Electronics investigated by UK's SFO for "suspected corruption" in Algeria
Hedge fund Elliott issues new attack on Vivendi (LSE: 0IIF.L - news) over Telecom Italia (Amsterdam: TI6.AS - news)
Debenhams cuts dividend as first-half profit slumps
Southwest challenged engine maker CFM over proposed FAA inspections
Acacia Mining (Frankfurt: 33A.F - news) posts lower Q1 earnings, maintains FY targets
(Helen Reid and Danilo Masoni)
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EUROPEAN STOCK FUTURES RISE AS EARNINGS DOMINATE (0612 GMT)
Futures across the major benchmarks are up 0.1 to 0.2 percent, indicating an upbeat open
after a strong trading day yesterday - particularly for commodities stocks.
ABB (LSE: 0NX2.L - news) shares are indicated up 1.6 percent higher after its profit beat, while Nestle is seen
gaining 1 percent after it reported growing volumes.
Today is going to be dominated by earnings, with some M&A news sprinkled in as well - here
are a few extra headlines to watch:
Publicis (Paris: FR0000130577 - news) beats Q1 growth expectations on North American rebound
Schneider Electric (EUREX: SND1.EX - news) beats Q1 revenue forecast on upbeat China demand
Pernod Ricard (TLO: RI-U.TI - news) gives more upbeat outlook after strong Q3
Aéroports De Paris Acquires Exclusive Control Of Airport International Group
Weir Group to buy Esco Corporation in $1.28 billion deal
(Helen Reid)
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EARNINGS, M&A: CORPORATE NEWS ROUND-UP (0532 GMT)
The earnings season is gathering pace and today we've got ABB reporting its best
start to the year since 2015, and a huge M&A move with Procter & Gamble agreeing to acquire the
consumer health business of Merck KGaA for around 3.4 billion euros.
It's a big day for consumer staples with Nestle also reporting increased volume
growth and confirming full-year guidance.
In other interesting results, Swiss pumpmaker Sulzer (IOB: 0QQ9.IL - news) , whose shares were dented by
sanctions on its main Russian shareholder, confirmed its 2018 outlook - saying it saw a one-off
hit of 10 million Swiss francs from business disruption due to the sanctions.
Currency movements are going to be particularly important this results season, and while
some companies will have been under strain due to the strong euro, others could benefit.
Novartis (IOB: 0QLR.IL - news) said it got a boost from a weaker dollar helping its first-quarter sales rise
10 percent.
Here are some of the headlines that have caught our eyes:
ABB's first quarter profit beats forecasts
P&G to buy German Merck's consumer health business for about $4.21 bln
Sulzer confirms 2018 outlook, sees small hit from sanctions impact
Nestle confirms outlook as volume growth picks up
Novartis Q1 sales beat gets help from weak dollar
France's AccorHotels upbeat about 2018 after strong Q1 sales
Total (LSE: 524773.L - news) buys stake in U.S. battery developer Ionic Materials
Deutsche Bank COO to leave amid continuing management reshuffle
(Helen Reid)
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EUROPE SEEN OPENING HIGHER AS RESOURCE STOCKS SHINE (0515 GMT)
Yesterday's resource stocks strength has spread into Asian trading overnight as oil prices
hit new highs not seen since late 2014.
Brent crude climbed to $73.77 a barrel, while U.S. crude rose to $68.73 after a Reuters
report that Saudi Arabia would be happy for crude to rise to $80 or even $100.
European stocks are likely to maintain Asia's trend higher, with spreadbetters calling the
DAX 18 points higher at 12,609, the CAC 40 up 14 points at 5,394, and the FTSE 100 6 points
higher at 7,323.
(Helen Reid)
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(Reporting by Danilo Masoni, Helen Reid, Kit Rees and Julien Ponthus)