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 (email@example.com), Joice Alves (firstname.lastname@example.org), Julien Ponthus (email@example.com) in London and Danilo Masoni (firstname.lastname@example.org) in Milan.
A RED SEA AFTER RECORD HIGHS(1650 GMT)
European bourses have closed on negative territory after the pan European index hit a record high earlier this week as investor sentiment was dulled by underwhelming earnings reports and the rising death toll from the coronavirus outbreak.
In terms of single stocks, NMC Health lost about a quarter of its price value today as the stocks volatility continues.
"Volatility will remain until the report on the financial health of the company will be released," says David Madden, market analyst at CMC Markets, adding that there were "big buyers coming in and out."
Another big loser of the STOXX today was Norsk Hydro, which shrank 12% after Q4 earnings miss.
CORONAVIRUS IMPACT ON RETAILERS: WAIT & WATCH (1422 GMT)
Many global retailers have come out with coronavirus warnings, shutting down some stores in mainland China, but there hasn't been much details on the financial impact.
For instance, Burberry today said 40% of its stores in mainland China are closed due to the fast-spreading virus but did not quantify the financial impact.
Nike, Adidas and many others similarly closed hundreds of stores.
"We think some disruption is inevitable and will hear about it either from a gross margin or availability issue in 2H," Citi analysts say.
Though the impact on shares of luxury retailers have been limited of late, their stocks have still not recovered from the knee-jerk reaction when coronavirus broke out in late January while the broader market has now comfortably recovered.
Many retailers in Europe are indeed very dependent on China:
Next hosted a warehouse visit at Doncaster for analysts and Investec says the retailer sources 20% of its goods from China.
"Next suggested that if the virus spreads further there will be a material impact on availability as production can't be shifted quickly enough," Citi analysts meanwhile said.
With long lead times and contingency plans, retailers such as H&M and B&M have suggested supply chain risks aren't imminent, Citi says.
WILL IT? WON'T IT? BITCOIN FLIRTS WITH $10,000 AGAIN (1309 GMT)
Bitcoin's been on a roll since the beginning of the year, so much so that it's now getting very close to reclaiming the $10,000 benchmark it touched in October 2018.
The original and biggest cryptocurrency has made strong gains since Jan. 3, when the United States killed the top commander of Iran's elite Quds Force of the Revolutionary Guards, Major-General Qassem Soleimani.
The threat of war in the Middle East sent shockwaves through financial markets, but boosted the cryptocurrency which some aficionados claim can act as a safe haven in such circumstances.
Others say it is merely a speculative bet.
Anyhow, bitcoin is up over 35% YTD.
Much has been said about how 'Tina' (there is no alternative) is pushing equities higher in a world of rock-bottom interest rates and low yields. In the same vein, some analysts attribute bitcoin's rise to the general hunger for profitable - even if risky - alternative assets.
Seems fair to say that bitcoin's opaque markets and high volatility are no deterrent given its whopping recent gains.
Some investors also argue that a 50% cut in the production of bitcoin due in May, known as the "halving," will drive demand higher.
The rule, written into the cryptocurrency's underlying code, slashes the number of new coins awarded to miners behind global supply of the cryptocurrency.
Here's the 35% run up in bitcoin since this new decade began:
(Tom Wilson with Julien Ponthus)
L,U,V,W - PICK YOUR CORONAVIRUS RECOVERY (1056 GMT)
While European stocks are currently en route for one of their best weeks since 2016, Chinese stocks suffered their worst weekly loss in nine months as the deadly and rapidly-spreading coronavirus kept on disrupting the world's second biggest economy.
So much for globalisation eh?
With many European blue chips warning about how the epidemic will hit their profits, like Burberry today, it's somewhat hard to reconcile the fact that European stocks have completely recovered from the initial coronavirus shock.
The STOXX 600's 'V' shaped recovery, which actually looks more like 5-year old drawing a 'W', seems to suggest that absolutely nothing negative has been priced in.
Here's an hourly chart of the index since Jan 20:
As noted in this story investors seem happily back to worrying about a dot.com style melt-up rather than freaking out over the virus being a deadly black swan.
Meanwhile the 'bottoming up' narrative which has fuelled part of the rally on European stocks is showing many cracks, not least this morning with German industrial output suffering its biggest fall since 2009 and strikes in France hitting industrial production more sharply than expected.
Adding these domestic setbacks to the old continent's large exposure (see Why the 'devil' coronavirus has hit European stocks hard) to China, it's difficult to comprehend the cool reception of headlines like this:
07-Feb-2020 08:20:16 - S&P GLOBAL SAYS CORONAVIRUS IMPACT WILL SLOW CHINA GDP GROWTH TO 5% IN 2020
Oxford Economics said it now believes Chinese industrial output growth will slow down and "also bring the tentative recovery in global manufacturing to a halt".
Again, at the moment, it seems many other analysts are banking on a short-term V shaped recovery, and can take comfort for instance that S&P expects growth to rebound to 6.4% in 2021.
Those reasons don't seem to match that of Rabobank's Michael Every.
"If this drags on through Q1 and into Q2 (...) then the negative effects in the first third of the year are going to be so bad that the rest of the year is never realistically going to get us back close to 6% y/y GDP growth again, or 5.2%".
Investors betting on the Chinese economy bouncing back in Q1 and Q2 2021 may severely underestimate the long term damage done, Every says.
THIAMXIT, A "TERRIBLE MISTAKE"?
Tidjane Thiam's exit as Credit Sussie's CEO has got a cold welcome from investors with the stock falling 3.5% as his exit is seen raising the risk of some friction between the bank's top shareholders and the board.
Though his departure was an option given the media spotlight on the bank's spying scandal, he was still backed by some of the bank's largest shareholders.
One of them, Harris Associates, recently said ousting Thiam would be a "terrible mistake", arguing that the CEO, who managed the turnaround, should stay on.
Thiam is credited with sharpening CS's focus on wealth management, scaling back investment banking and shoring up its balance sheet.
"We feel this (Thiam's exit) was seen as a distant prospect for most international investors to whom this outcome will come as a surprise," Citi says.
Looking at the share price this morning, it's not a good one.
OPENING SNAPSHOT: SLIDING DOWN VERY GENTLY (0835 GMT)
The STOXX 600 is off 0.2%, sliding down only very gently considering the overall negative tone of this morning's corporate and macro announcement.
Top news comes with top market reaction and Credit Suisse is down 4% after Tidjane Thiam quit the bank. Premarket indications from traders had shown limited market reaction.
Other big moves this morning are Norsk Hydro, down 7.3% after its earnings miss and Belgium's Umicore down 5% after its trading update.
Burberry's warning on how the virus will impact demand is only dragging the stock down 2%, which means investors are clearly not pushing the panic button. Also worth noting that the stock has fallen 15% since the virus outbreak in China.
On that note L'Oreal is the top gainer in France with a 3% rise and investors visibly pleased with its results even as it warns on the coronavirus impact to China sales.
Finland's Nokia and Sweden's Ericsson have also made their way to the happy few club, no doubt after Attorney General William Barr said the U.S. and its allies should consider taking a "controlling stake" in the companies to counter China's Huawei.
Shares in Norwegian fertiliser-maker Yara are also up a whopping 6% after reporting stronger-than-expected quarterly profits and teasing that a decision on a long-planned spinoff of its industrials unit could be made by mid-2020.
ON THE RADAR: THIAMXIT AND BURBERRY'S VIRUS WARNING (0742 GMT)
There's no way around it, the surprise resignation of Credit Suisse CEO Tidjane Thiam is on the top of the news agenda this morning even if there's limited scope for a wider market price impact on the rest of the European banking sector. At the moment, pre-market indications suggest it doesn't seem that the stock of the Swiss bank itself will make a big move at the open.
In terms of spillover effects, Burberry warning that the outbreak of the coronavirus in China is hurting luxury demand is likely to hurt its French and Italian peers. Premarket indications show the British group is likely to take a big (5%) hit at the open.
It should also make investors worried that the threat of the virus has been downplayed, well, more worried. Last evening France's L'Oreal also said the health crisis would have a short-term hit on its Asian business.
A list of companies telling their shareholders that the epidemic will hurt their balance sheet can be found here:
On that note we've got a pretty interesting story on how the global container shipping trade is struggling to cope with the disruption caused by the virus:
There's still quite a lot of Q4 action going on with notably Belgium's Umicore, which has already surged close to 80% since the summer, reporting a better-than-expected operating profit for 2019. Also a decent beat for Norwegian fertiliser-maker Yara with October-December profits.
In the bruised basic material sector, aluminium producer Norsk Hydro missed expectations and seems to be heading for a plunge when the market opens.
A big one for merger arbitrage hedge funds is EU antitrust authorities opening an in-depth investigation into Ray-Ban maker EssilorLuxottica's 7.2 billion euro bid for Dutch opticians group GrandVision.
Another quite extraordinary item which somewhat went under our radar last afternoon is Attorney General William Barr saying the U.S. and its allies should consider taking a "controlling stake" in Finland's Nokia and Sweden's Ericsson to counter China-based Huawei's dominance in next-generation 5G wireless technology.
MORNING CALL: TIME FOR A BREATHER? (0634 GMT)
European stocks have enjoyed four straight sessions of gains in what has been their best week yet since December 2016.
Futures are however currently trading slightly in the red, suggesting the time may have come for some kind of a breather.
Financial spreadbetters at IG expect Frankfurt's DAX to open 28 points down, Paris' CAC to retreat 5 points and London's FTSE to lose 7 points.
While Wall Street reached new highs on Thursday, Asian markets closed in negative territory as doubts over whether investors jumped the gun in shrugging fears about the coronavirus epidemic crept in.
With no clear direction set at the moment, the U.S. non-farm payrolls may be key later on this afternoon to finally set the mood.
(Reporting by Danilo Masoni, Joice Alves, Julien Ponthus and Thyagaraju Adinarayan)