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LIVE MARKETS-Relationships are so last year

* Oil & gas stocks climb after crude rally

* Fear of easing China stimulus holds market back

* Umicore down 15 pct on 2020 earnings warning

* Wirecard falls after regulator lifts short sale ban

* Thomas Cook jumps on Sky report of possible bidders

* Ahold Delhaize down as U.S. strikes to hurt margins

April 23 - 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 the market:


You heard it here first: European traders, asked what they value most in a broker's

services, say they don't care much for the broker's relationship to their covered companies.

This shift relative to traders in other regions shows the consequences of sweeping MiFID II

regulation which totally recalibrated the way brokerages and the buy-side worked together.

Traders in Europe's post-MiFID II world demand low-touch (highly automated) execution

service and market structure expertise, according to a new report by Greenwich Associates which

surveyed sell-side actors between May and October last year.

The overall relationship of a broker with its coverage, along with "high-touch" (complex and

less automated) trading service, are less valued in Europe relative to the U.S. and Canada.

"This is a clear reflection of the shift in perspective brought about by the MiFID

regulations, and a sign of how North American markets may evolve as MiFID-like practices

permeate into these equity markets," writes Greenwich's Richard Johnson.

(Helen Reid)



Saxobank's head of equity strategy Peter Garnry has echoed the thinking of his UniCredit

counterpart Christian Stocker, concluding that stocks may be vulnerable to another blowout as

specs pile on bearish bets on the U.S. volatility index at break-neck speed.

"Q4's wall of worry has been replaced by complacency about the many problems in the global

economy," he says in a note this morning.

Friday's weekly CFTC report for the week to April 16 showed the speculative net short in the

VIX rose to just under 170,000 lots, from 164,000 the previous week (see the chart


According to the bank, that's just 5,000 shy of the October 2017 record set shortly before

the February blowout last year.

"Again we have all the ingredients for a major reset in equity markets if the right catalyst

presents itself," Garnry says.

Two equity strategists do not a consensus make, but it feels like it's building momentum.

(Josephine Mason)


Fourteen percent is a sizeable move for chemicals and battery materials firm Umicore - in

fact, the stock is set to seal its worst one-day drop since November 2008.

A warning of lower than previously expected growth in revenue and earnings in 2020 has taken

a toll, and dragged peer Johnson Matthey down slightly too.

The factors Umicore points to as catalysts for its warning shed a light on the broader

picture for electric vehicles. These include:

* Lagging electric vehicle demand in China

* Larger than expected cuts to subsidies for EVs in China (which have been a key driver of

consumer takeup)

* Delayed launch of a large EV platform in China

* An increase in artisan cobalt mining driving cobalt prices down, hurting margins in its



"Previously subsidies usually accounted for one-third of the battery EV price and close to

10% of the plugin hybrid vehicle price," write UBS analysts.

"With increasing EV competition and some OEMs already setting prices on a post-subsidy

basis, this cost pressure may also be shared upstream with suppliers, something already seen in

electric buses," they add.

Equita analysts' take: "We believe that such a rapid growth process can have periods of

slowdown but that does not change the underlying trend."

UBS sees little read-across to Johnson Matthey which has only recently announced its first

investment in battery materials.

Investec analysts reckon Umicore "remains strongly placed for auto electrification, but its

impressive growth expectations are clearly under pressure".

It's those impressive growth hopes that have driven Umicore shares up sharply over the past

years - as you can see below, Umicore has easily outperformed European peers in the electric

vehicle battery race, but its shares have slowed down recently.

(Helen Reid)



After nine straight quarters of rising year-on-year crude prices, the macro backdrop for oil

companies toughened in Q1 but for Bernstein that'll just show how resilient they've become after

the big cost cuts made in the wake of the 2014 price downturn.

"We find that despite 40 percent lower oil prices in 1Q19 vs the 2011-2014 peak, CFO (Cash

flow from operating activities) will only be 6 percent lower," analysts at the U.S. investment

firm say, confirming their overweight on the sector.

And, going forward, geopolitical uncertainty around Iran and other areas may provide further

upside risks, as this week's huge spike in crude prices would suggest.

"We continue to expect a record FCF year at our $70/bbl oil price deck, leading to another

year of strong shareholder returns," they say, also highlighting how cheap the sector remains

compared to the broader marker.

(Danilo Masoni)



After sharp cuts to earnings estimates since the end of last year, many investors and

analysts are predicting a bottoming out, with earnings forecasts to rise from here as Q1 results

start coming through. A stabilisation in earnings revisions has fed that theory.

But Goldman Sachs analysts disagree.

"The historical relationship suggests EPS could be revised up during the season - albeit

modestly," Goldman Sachs' head of European equity strategy Sharon Bell writes. "But the

predictive power of market moves for EPS revisions is not strong - especially when central bank

policy moves have helped drive market gains."

Besides, the pace of earnings revisions has remained above the 10-year average (see chart


"From here downgrades are still likely, albeit at a slower pace," Bell and team conclude.

They see STOXX 600 earnings growing 2 percent this year and 2 percent in 2020 - much less

than consensus.

(Helen Reid)



Oil stocks are up 1.7 percent this morning after a crude rally, set for their biggest

one-day gain since February 5 this year. But that boost isn't enough for Europe's stock markets

which are falling 0.1 to 0.2 percent as fear of less stimulus from China and weak results from

Umicore and Melexis drag sentiment down.

Overall, the market is being driven down by falling metals prices amid worries China may

ease its stimulus measures after its economy showed signs of recovery.

A top party decision-making meeting in China on Friday affirmed authorities' support for the

economy, but also said they would push forward structural de-leveraging and prevent speculation

in the property market, suggesting attention may be turning back to debt risks that any further

major stimulus measures may create.

Umicore is sinking 15 percent after warning 2020 profits and earnings will be lower. The

warning is dragging the chemicals sector down 1 percent.

In car parts stocks, Faurecia is up 2 percent after sticking to its full-year profit target,

while auto chipmaker Melexis is down 6.5 percent after its weak Q2 guidance.

Dutch supermarket chain Ahold Delhaize is another big faller, down 4.7 percent after saying

strikes at its U.S. "Stop & Shop" business would hurt 2019 margins.

Wirecard is down 3.9 percent after Germany's market regulator lifted a ban on short selling.

A rare gainer was driven by M&A hopes: Thomas Cook shares are jumping 12 percent after Sky

News reported of possible bidders for the tour operator including Chinese conglomerate Fosun


(Helen Reid)



European shares are set to rise slightly as equity investors returned from an Easter break

to find oil prices at five-month highs. The rally in crude should help the oil major-heavy FTSE

100 outperform, with futures up 0.4 percent, while futures for France, Germany and Spain were up

0.1 to 0.3 percent.

Earnings are streaming in, with battery maker Umicore among the biggest movers pre-market

after it warned revenue and earnings growth in 2020 would be lower than previously expected. Its

shares are seen down 5 to 10 percent.

Car parts and automotive semiconductor companies are also among those reporting, with varied

results. Plastic Omnium warned of a decline in worldwide auto production while reporting an

increase in Q1 revenues, and auto chipmaker Melexis said slowing global car sales and trade

tensions had weighed on performance.

Plastic Omnium is seen down 2-3 percent, along with Melexis. Faurecia meanwhile is expected

to rise 2 percent after it confirmed its full-year target and reported a rise in Q1 sales.

Shares in French supermarket Casino are seen rising slightly after it announced it was

expanding its partnership with Amazon after a successful earlier deal with its Monoprix chain in


Dutch supermarket chain Ahold Delhaize is expected to fall 2 percent after saying an 11-day

strike at its “Stop & Shop” chain in the U.S. would hurt margins. Bernstein cut the stock to

'neutral' from 'outperform'.

In M&A news, Thomas Cook shares could jump 10 to 15 percent, traders say, after a Sky News

report on Saturday said the tour operator has been approached by potential bidders.

And Anglo American shares could rise after the Telegraph reported the miner has called in

investment banks to help it defend against a possible takeover bid from Volcan Investments.

(Helen Reid)



Futures for European indices are edging higher this morning with the FTSE 100 in the lead -

likely boosted by oil majors Shell and BP - while earnings start to roll in.

We've got results from a couple of French car parts suppliers - Plastic Omnium and Faurecia

- which show different pictures with Plastic Omnium warning of a decline in worldwide auto

production while Faurecia confirmed its full-year target.

Belgium's Melexis, which makes chips for cars, also said slowing global car sales and trade

tensions had weighed on performance.

French retailer Casino is also in the spotlight: it announced the expansion of a partnership

with Amazon, and also sold a portfolio of hypermarkets and supermarkets to U.S. asset manager

Apollo Global in a deal worth up to 470 million euros ($528.6 million).

Here are your headlines:

France's Casino expands partnership with Amazon

French fashion group SMCP forms partnership with China's

TechnipFMC wins major contract for ConocoPhillips TOR II development

Car parts group Faurecia confirms FY target as Q1 sales climb

BRIEF-Melexis Q1 EBIT Down At EUR 15.7 Mln

Danone's Bledina France arm wins B-Corp certification

Plastic Omnium's Q1 revenues rise, expects decline in worldwide auto production

French retailer Casino sells assets to Apollo Global

Activist Knight Vinke calls for Uniper split to end Fortum deadlock

Barclays to cut investment bankers' bonuses- FT

BRIEF-Umicore Sees FY 2019 Recurring EBIT Between 475 And 525 Million Euros

(Helen Reid)



Oil is in the spotlight today, with Brent crude hitting its highest since November 2018

yesterday after Washington announced all Iran sanction waivers would end by May.

Helped in part by this jump in crude, European stocks are set to make some progress as

investors return from Easter break to face a busy week of earnings reports.

Stocks in Asia rose marginally as many markets reopened after the long Easter break, while

oil jumped to its highest this year as the United States tightened sanctions on Iran.

Financial spreadbetters expect London's oil major-heavy FTSE 100 to open 22 points higher at

7,482, Frankfurt's DAX to open 11 points higher at 12,233, and Paris' CAC 40 to open 4 points

higher at 5,584.

(Helen Reid)


($1 = 0.8891 euros)

(Reporting by Helen Reid, Danilo Masoni, Josephine Mason and Thyagaraju Adinarayan)