LIVE MARKETS-M&A, whether "real or imagined", will boost telcos sector

Jan 23 (Reuters) - 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: julien.ponthus.thomsonreuters.com@reuters.net

M&A, WHETHER "REAL OR IMAGINED", WILL BOOST TELCOS SECTOR (1016 GMT)

Long-awaited consolidation deals could be a driving force behind a brighter year for the

European telcos sector, Deutsche Bank (IOB: 0H7D.IL - news) analysts say, the day after Orange (LSE: 0OQV.L - news) and Deutsche

Telekom shares were boosted by a report they had held merger talks last year.

"Reports that Deutsche Telekom (IOB: 0MPH.IL - news) was in talks with Orange would appeal to the European

Commission which has long argued for a single market for Telco services, and what better

demonstration than a merger of French and German incumbents," note analysts.

Whether ramping M&A is 'real or imagined', it will help inject more optimism into telcos,

they say, with smaller operators, including those with limited government ownership or more

flexible governments, likely to gain from increased deals speculation.

Overall they're positive on the sector which they think will do well in 2018 after two years

of underperformance drove its valuations sharply down, making them relatively attractive. DB's

top sector picks are Vodafone, Telenet (LSE: 0GAF.L - news) , KPN (Amsterdam: KPN.AS - news) , Telefonica (LSE: 826858.L - news) and

Liberty Global (Frankfurt: A1W0FL - news) .

(Helen Reid)

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BREXIT WATCHERS, WHAT DO YOU MAKE OF BLANKFEIN'S LATEST TWEET? (0947 GMT)

The CEO of Goldman Sachs (NYSE: GS-PB - news) , which has yet to announce precise plans as to how it will move

staff from the City of London (LSE: CIN.L - news) to Frankfurt and Paris post-Brexit, has just delivered some high

praise to France's Macron after a meeting in Versailles. (Reuters was there:)

"Feels like a new day has dawned in France," Lloyd Blankfein tweeted, leaving Brexit

watchers speculating whether this is a hint as to where the bulk of the London jobs will go.

Last October, the CEO caused some English eyebrows to rise with this tweet: "Just left

Frankfurt. Great meetings, great weather, really enjoyed it. Good, because I'll be spending a

lot more time there. #Brexit"

(Julien Ponthus and Helen Reid)

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OPENING SNAPSHOT: DAX AT NEW RECORD, STRONG POUND WEAKENS FTSE (0809 GMT)

As expected European shares have opened in positive territory with the pan-regional STOXX

600 index edging up 0.3 percent.

The outstanding mover however is the DAX. The main German stock index has hit a

fresh all-time high and is up 0.8 percent, while Britain's FTSE looks the weakest among

big European indexes after the pound reached a post-Brexit vote high.

(Danilo Masoni)

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WHAT YOU NEED TO KNOW (0749 GMT)

European shares are set for a strong start in the wake of the rally, which took place in

Asia and on Wall Street following the deal to end the U.S. government shutdown.

After yesterday’s M&A-fuelled session, there is little corporate news at this stage but

faith in “global synchronised growth” should continue lifting indexes to new highs.

Among possible movers is Sky (Frankfurt: 893517 - news) : Britain's competition regulator said Rupert Murdoch buying all

of Sky was not in the public interest because it would give the media mogul too much influence.

Also EasyJet said recent reductions in capacity by competitors in the industry were

contributing to a positive trading environment, as revenues improved in the first quarter.

Still in the industry, Wizz Air (Frankfurt: WI2.F - news) is keen on Alitalia (Stuttgart: 2278962.SG - news) but only for short, medium-haul routes.

Here are a few other interesting headlines:

Netflix (Xetra: 552484 - news) crosses $100 bln market capitalization as subscribers surge

Trump deals blow to solar makers; forcing industry to look elsewhere for growth

Sweden's Com Hem Q4 underlying EBITDA just beats forecasts

SGS (LSE: 0QMI.L - news) expects sales growth in 2018 after FY profit rises

Niki Lauda to buy airline he founded, say administrators

Carrefour CEO steps up digital push, inks deal in China

Paragon (IOB: 0NFG.IL - news) 's Q1 lending rises as buy-to-let focus pays off

(Julien Ponthus)

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TRUMP'S SOLAR TARIFFS TO HIT EUROPE TOO (0734 GMT)

U.S. President Donald Trump announced late yesterday tariffs on some imported solar cells,

boosting shares in U.S. solar companies but hitting rivals in Asia, such as Korean solar panel

manufacturers.

There could be victims in Europe too, such as Germany's SMA Solar Technology (IOB: 0NIF.IL - news) ,

which develops photovoltaic system technology.

"This could bother SMA's already difficult US business furthermore. SMA hosts CMD Friday

maybe giving some insight soon," a Frankfurt-based trader said.

Another trader said also shares in Solarworld (IOB: 0QJC.IL - news) , REC Silicon (LSE: 0FS8.L - news) , Solar A/S (LSE: 0G33.L - news)

, Soitec (Paris: FR0004025062 - news) and Solar-Fabrik could be under pressure following

Trump's move.

(Danilo Masoni)

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FUTURES POINT TO A STRONG START FOR EUROPEAN BOURSES (0706 GMT)

There seems to be little doubt as to whether European shares will follow the rally in Asia

and on Wall Street which followed the deal to end the U.S. government shutdown:

(Julien Ponthus)

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AN ECB CHEAT SHEET: FROM "VERY DOVISH" TO "VERY HAWKISH" (0650 GMT)

As Thursday's ECB meeting quickly approaches, ING has drafted a "cheat sheet" to help

investors read through Mario Draghi's carefully scripted language and decide whether his message

is "dovish" or "hawkish".

Here it is:

(Julien Ponthus)

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MORNING CALL: EUROPE TO RISE IN THE WAKE OF U.S. SHUTDOWN DEAL RALLY (0618 GMT)

Good morning and welcome to Live Markets. European shares are set to open higher on Tuesday

in the wake of the rally on Wall Street and Asia which followed a deal to end a three-day

government shutdown in the U.S.

Financial spreadbetters expect London's FTSE to open 18 points higher at 7,733.1,

Frankfurt's DAX to open 54 points higher at 13,517 and Paris' CAC to open 17 points higher at

5,558.5.

(Julien Ponthus)

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(Reporting by Danilo Masoni, Helen Reid, Kit Rees and Julien Ponthus)