UK Markets close in 3 hrs 58 mins

LIVE MARKETS-Quick turnaround

* European shares reverse course; STOXX 600 up 0.5% * US says to delay China tariffs on some products * Miners, oil & gas and cars now top gainers * Trade hopes offset poor German data, Italian crisis, Argentina turmoil * Henkel cuts outlook, shares slump to 6-week lows * Wall Street jumps after U.S. to delay some China tariffs * 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 QUICK TURNAROUND (1412 GMT) It took just a few upbeat headlines from the Sino-U.S. trade front to trigger a quick reversal in direction for stock markets with European equities jumping 1.5 percentage points in less than 25 minutes to trade up 0.8% on the day. The Office of the U.S. Trade Representative said the Trump administration would delay 10% tariffs on certain Chinese products, including laptops and cell phones, that had been scheduled to start next month. That came as Chian's Commerce Ministry confirmed Vice Premier Liu He had a phone call with U.S. Trade Representative Robert Lighthizer and U.S. Treasury Secretary Steven Mnuchin. Relief and signs of an easing in the trade tensions have lifted shares in Europe (as you see below), and in the U.S. investors quickly rushed back into risky assets, selling gold and other safe havens. (Danilo Masoni) ***** TAKING STOCK OF BANK RESULTS: PREFER LESS RATE-SENSITIVE NAMES (1053 GMT) The earnings season for banks wasn't bad with most European lenders beating profit estimates but still the sector is under immense pressure from the adverse interest rate outlook and is trading at record lows relative to the market. Credit Suisse analysts led by Jon Peace have found out that share price moves in banks following the release of their results showed the most correlation with their net interest income (NII) as well as with forward guidance. "Weakest performers in Q3 have been Spanish banks and Benelux banks on rate guidance while best performers have been French banks (least rate sensitive and no capital shocks). Against this backdrop, we continue to prefer less rate-sensitive banks with strong balance sheets," they say. According to CS, around 70% of large cap EU banks beat Q2 adjusted profit before tax consensus by an average of 4%, but lower interest rate expectations weighed on forward guidance, leading to 4% 2020 EPS downgrades since end June (versus market flat). (Danilo Masoni) ***** EUROPE INC STILL HUNGRY FOR BUYBACKS (0841 GMT) Investors may be in risk-off mode but Europe Inc isn't. A Barclays analysis of over 2,000 transcripts has found out that appetite for share buybacks is still there, undamaged by the grip of worries surrounding the economy and trade. "The U.S.-China trade war is the biggest concern for over half of the companies. Worries about Brexit went up... Rising labour costs, tougher competition and the cost of innovation are seen as headwinds for profit margins, but spending in digitalisation is still considered as both necessary and positive, while the appetite for buybacks is intact," strategists at the UK bank led by Emmanuel Cau say. More in detail, Cau and team say European announcements of buyback programmes were higher than usual in Q2 and were near the highs seen in the last cycle. "This quarter saw many companies from almost every sector activating or expanding buyback programmes, thanks to increased cash positions and wanting to use cash 'for the benefit of shareholders'," they add. Data from Morgan Stanley last month showed that European companies have spent a net $100 billion on buybacks in the last 12 months, the highest run-rate on record. (Danilo Masoni) ***** EUROPE DIPS, ITALY AND SPAIN UNDERPERFORM, HENKEL SLUMPS (0731 GMT) European shares are off to a weaker start with a string of worries (HK protest/trade wars to name just two) dampening sentiment and sending the STOXX 600 benchmark down 0.3% in early deals. Political uncertainty in Italy has sent Milan's FTSE MIB index to its lowest since June, while Spain, which has big ties in Latin America, is also underperforming as investors dump Argentinian assets on worries over the return of populist policies in the country: Madrid's IBEX has hit its lowest since Jan 4, down as much as 0.7%. "It may be a new week but markets have still been dealing with the all-too-familiar feeling of risk-off over the last 24 hours," Deutsche Bank strategists say in a note. Here's your opening snapshot: Henkel is the big mover in early deals, down 4.5% after the German consumer goods company lowered its FY outlook for sales and earnings, blaming disappointing performance at its beauty unit and a hit to its adhesives business from falling industrial production. "This was another disappointing reporting... The new big question is if the sustained terrible operating results will induce dramatic changes (e.g. a change in management, or a "strategic review" of Beauty) which we do not anticipate in the short term," says Andrew Wood, analyst at Bernstein. (Danilo Masoni) ***** WHAT WE'RE WATCHING AT THE OPEN (0654 GMT) European shares are set for a depressed start today as political uncertainty in Italy keeps investors on the edge and following sharp losses in Asia on a mix of worries ranging from trade wars, to Hong Kong protest and the crash in Argentina's peso currency. European stock futures are down 0.2-0.8%, with Spain's futures leading the charge lower hit hardest by the collapse of Argentina's financial markets overnight. On the corporate front there are still some earnings reports to digest as the Q2 reporting seasons draws closer to its end with around three-quarters of companies on the STOXX 600 having already released their numbers. Henkel shares are set for a big fall after the German consumer goods company lowered its FY outlook for sales and earnings, blaming a disappointing performance at its beauty unit and a hit to its adhesives business from falling industrial production. Its shares are down 9% in early trade. TUI shares are also seen opening down 1-3% after quarterly sales and core profit fell short of analyst estimates, hit by costs resulting from the grounding of the 737 MAX. The European travel and tourism operator however upheld its earnings outlook for the full year. Overall, Q2 earnings are expected to have decreased 2.7% year on year, throwing Europe Inc into an earnings recession, according to latest data from Refinitiv IBES. Results also in from Swiss Life (+1.9% in premarket), and a number of small- and mid-cap firms, including Fraport (seen flat to slightly higher), Aareal Bank (+2.5% premarket), and Deutsche Wohnen (calls mixed); Hellofresh (up 6.1% early trade). In tech, semiconductor stocks could be under pressure after Taiwan Semiconductor shares fell after Q2 earnings missed expectations. UK headlines: UK energy regulator asks National Grid for urgent report into power cut Moody's downgrades Rolls-Royce to Baa1 from A3; outlook changed to stable from negative Plus500 profit slumps, regulatory threat looms in Australia Mears Group posts drop in half-year profit, order book strong John Menzies reports first-half loss TUI says robust business outweighs 737 MAX grounding, upholds outlook Burford Capital CIO purchases additional shares (Danilo Masoni) ***** FUTURES DIP, HENKEL CUTS OUTLOOK, EYES ON MID-CAP RESULTS (0613 GMT) European stock futures have opened down slightly as investors remain cautious due to ongoing political uncertainty in Italy and following losses in Asia where investors were put off by trade fears, protests in Hong Kong and the slump in Argentina's peso currency. On the corporate front it looks rather quiet so far, but there are still some earnings reports to digest as the Q2 reporting season draws closer to its end with around three-quarters of companies on the STOXX 600 having already released their numbers. Henkel is down 9% in early trade after the German consumer goods company lowered its FY outlook for sales and earnings, blaming disappointing performance at its beauty unit and a hit to its adhesives business from falling industrial production. Results also from Swiss Life, up 1.9% in premarket, and a number of small- and mid-cap firms, including Fraport, Aareal Bank, and Deutsche Wohnen . In other news, Diageo signed a joint-venture deal with state-run Cuba Ron SA to market Santiago de Cuba Rum, in defiance of U.S. efforts to dissuade investment in the Communist-run country. Here's your headlines roundup: Henkel blames beauty, slower industry for outlook cut Swiss Life expects single premiums to return to more normal level next year British beverage giant Diageo to market Cuban rum US Senator Grassley seeks info on Novartis's Zolgensma data issues BRIEF-Fraport Sees 0.8% Y/Y Rise In July Passengers To More Than 6.9 Mln BRIEF-Aareal Bank Confirms Forecast As Q2 Net Income Remains Stable BRIEF-Deutsche Wohnen Affirms 2019 Forecast For FFO I BRIEF-Grammer H1 EBIT Rose 19.8% To EUR 50.2 Mln (Danilo Masoni) ***** EUROPE SEEN STEADY (0536 GMT) European shares are set to open flat to slightly higher today although sentiment could remain jittery amid a mix of persistent economic and geopolitical worries, which already soured sentiment yesterday to esase the early gains seen at the start of the session. "On their own, concerns about US, China trade, slowing growth, and the risk of recession in Europe's biggest economy, Brexit, the possibility of Italian elections, unrest in Hong Kong, as well as a crisis in Argentina, and tensions in the Arabian Gulf might be containable," says CMC Markets analyst Michael Hewson. "Taken together in the round as a cocktail of risks against a backdrop of central banks almost out of ammunition and you have a recipe for a lot of nervous investors," he adds. Markets will also be watching developments in Italy where right-wing League leader Matteo Salvini's drive for early elections hit a road bump on Monday with parliamentary party leaders failing to decide when the Senate should debate his no-confidence motion in the government. Financial spreadbetters at IG expect London's FTSE to open 14 points higher at 7,241, Frankfurt's DAX to open 17 points higher at 11,696, and Paris' CAC to open 5 points higher at 5,316. The pan-European STOXX 600 index fell 0.3% on Monday. Over in Asia, shares fell with MSCI's broadest index of Asia-Pacific shares outside Japan down more than 1%. (Danilo Masoni) ***** (Reporting by Danilo Masoni, Josephine Mason and Thyagaraju Adinarayan)