UK markets close in 3 hours 26 minutes

LIVE MARKETS-A rate cut every five days

* STOXX 600 hits fresh record highs * German GDP disappoints * EDF tops STOXX 600 after beating forecast * RBS shares drop after results * Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters. You can share your thoughts with Thyagaraju Adinarayan (, Joice Alves (, Julien Ponthus ( in London and Danilo Masoni ( in Milan. A RATE CUT EVERY FIVE DAYS (1405 GMT) When Mexico decided to cut rates yesterday little did they know they'd be the 800th to do so since the global financial crisis (H/T to BofA on the rate cut count). And that works out to one rate cut every 5.2 days! Staggering, isn't it? That cheap money has perhaps created a bubble in fact a "twin bubble", Bofa says: One in bonds and the other in tech stocks. The latter has been a major boost to the S&P 500. In their latest number crunching of weekly flows, BofA says at current pace, bond funds could attract as much as $1 trillion this year from investors and equities are likely to pull-in $450 billion, a new record! All this, when coronavirus cases continue to rise and economists scramble to mark down estimates for the global economy. "There is quite a bit of ink being spilled to say that markets are not taking Covid-19 seriously," Stephen Innes, chief market strategist at AxiCorp, said earlier this week. "But with 10-year yields falling to sub-1.6% and the Fed hinting that its reaction function includes Covid-19 and the PBoC already flooding markets awash with cash, papers over that cautious scenario." (Thyagaraju Adinarayan) ***** STOCK VALUATIONS HIGH BUT OUTSIDE BUBBLE TERRITORY (1301 GMT) By definition a bubble occurs when there is a surge in asset prices, not justified by the fundamentals, and driven by exuberant market behaviour. With STOXX 600 hitting new record highs even with the bloc's largest economy suffering GDP numbers today and the region's corporates staring at their fourth straight quarterly earnings decline, stuck deep in the earnings recession mud, it sounds like a bubble indeed. On the other side of the pond, markets seem to be in their own league notching record highs and big gains fuelled by tech euphoria. Still, NN Investment Partners says "global equity valuations are high but outside bubble territory." "On more traditional metrics such as price-to-earnings, the market is at the high end of the historical range, although not at extreme levels and close to 2015-2017 levels," NN adds. (Joice Alves) ***** MUCH LOVE FOR FRANCE ON VALENTINE'S DAY (1157 GMT) If you look at the top movers today, there is an eye-catching French utility topping the pan-European index: EDF - the stock gained more than 9% after the company beat forecasts. If you add to that, it's Valentine's Day we may have a case to turn our attention to a top honeymoon destination. BofA's research team has turned "overweight" on French stocks on hopes those shares will benefit from the expected rise in bond yields given their high cyclical exposure. France's "large cyclical weighting means it outperforms the Stoxx 600-implied trajectory when Bund yields rise," BofA says in a note highlighting that the country has the largest share of cyclicals relative to defensives among the major European markets. The bank has also upgraded Spanish and Italian stocks to "overweight" for similar reasons, while downgrading Switzerland and the UK to "underweight" as they both are defensive-heavy markets. (Joice Alves) ***** OPENING SNAPSHOT: RECORD HIGH IT IS! (0828 GMT) European stocks briefly touched record high levels before dipping a bit, weighed down by a sharp fall in Astrazeneca and Renault shares. Astrazeneca's fourth-quarter profit missed estimates and the pharma company said coronavirus is likely to impact 2020 performance, sending its shares 5% lower and wiping $6.5 billion off its market capitalisation. As expected Renault opened lower after the carmaker posted its first loss in 10 years and set a lower operating margin goal for 2020. EDF and RBS are the other top movers, the French utility is the top performer on STOXX rising 7% after reporting consensus-beating results and dividend, and the UK bank slips 3% after its dividend fails to impress investors. Meanwhile, Germany's Lufthansa said it would suspend all flights to mainland China until March 28, a month longer than it had initially announced. That news is likely weighing on sentiment this morning. Here are the winners & losers on STOXX 600: (Thyagaraju Adinarayan) ***** WHAT VIRUS? STOCKS AT RECORD; RENAULT, ASTRAZENECA, RBS IN FOCUS (0751 GMT) European stock futures point to small gains but that's enough to power the pan-European STOXX 600 index to yet another record high as investors shrug off virus fears amid hopes that it is unlikely to leave a long-lasting damage on the global economy. All this despite warnings from companies that virus is likely to hit their 2020 performance. "I think there is light at the end of the virus tunnel. The virus impact is probably just a near term demand shock that has been mitigated by central bank liquidity," Stephen Innes, chief market strategist at AxiCorp, says. In corporate news, Renault shares are seen falling sharply after the French carmaker reported its first loss in a decade and set a lower operating margin goal for 2020. Astrazeneca and Schindler are also seen falling 2% to 3% after they reported below-consensus results and warned that coronavirus is likely to dent their 2020 performance. Stock brokers also call European tech stocks higher on the back of solid print from U.S. chipmaker Nvidia. In the UK, RBS is seen rising 2%-3% after the bank reported better than expected results and a strong capital position. Other potential movers: Wirecard's EBITDA miss; Credit Agricole earnings beat; EDF's beat (Thyagaraju Adinarayan) ***** MORNING CALL: RECORD HIGHS IN SIGHT (0635 GMT) The pan-European STOXX 600 index is all set to scale fresh peak and end the week on a high even as rising coronavirus cases pose a potential threat to global economy. Several companies have already warned on the impact from the fast-spreading virus. Elevator maker Schindler is the latest to do so, it said "we now have to recognize that the coronavirus pandemic will have implications on operations and results." Financial spreadbetters IG expect London's FTSE to open 10 points higher at 7,462, Frankfurt's DAX to open 31 points higher at 13,777, and Paris' CAC to open 7 points higher at 6,100. (Thyagaraju Adinarayan) ***** ($1 = 0.7662 pounds) (Reporting by Danilo Masoni, Joice Alves, Julien Ponthus and Thyagaraju Adinarayan)