LIVE MARKETS-What a streak! Eurozone blue chips eye ninth day of gains

* European shares rise 0.7 pct

* Autos, banks lead gains

* Euro zone blue chips set for 9th day of gains

* Wall Street futures rise

Sept 20 - 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 market moves: helen.reid.thomsonreuters.com@reuters.net

WHAT A STREAK! EUROZONE BLUE CHIPS EYE NINTH DAY OF GAINS (1300 GMT)

Relief that fresh U.S. and Chinese tariffs on reciprocal imports were less harsh than feared

is keeping sentiment high, lifting European equities further up as U.S. stock futures point to

another positive session on Wall Street.

Particularly in favour is the euro zone blue chip index. It is now up 0.9

percent, its strongest day since July 26 and firmly on track for nine sessions of gains in a

row.

What a streak! The last time it did nine straight positive sessions was in June 2010. More

than 8 years ago! Financials are the biggest driver of the bounce as investors are lured back

by cheap valuations.

(Danilo Masoni)

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UK RETAIL SALES RELIEF MASKS CONTINUED GLOOM ON REAL ESTATE (1214 GMT)

Today's retail sales figures have delivered a much-needed bit of relief to sterling and

indicated a silver lining to a gloomy outlook for the UK as British shoppers kept up their

strong summer spending spree in August.

But the retail real estate sector is still not luring in buyers.

"Many of the share prices look cheap but for a reason, and bar some M&A activity, we believe

it is best to stick with the relatively safer income generating stocks together with some of the

hands-on small/mid cap development/land plays," write Stifel's Miranda Cockburn and team.

They note the sector is more diverse than it used to be, but around 30 percent of the stocks

they cover are still retail-focused.

"In our view the only potential upside will come from some M&A activity," they say. "This

has got to be a possibility given share price weakness but with the current uncertain outlook we

think it is unlikely that anyone will want to pay up for regional shopping centre exposure."

The lower risk option they favour is income-generating stocks in student accommodation,

healthcare real estate, and industrial property, which as you can see below, trade at a slight

premium to book value, in contrast with many other REITs. Stifel points to Empiric, Assura (LSE: AGR.L - news) ,

Hansteen, and Mucklow.

Citing Investment Property Forum forecasts, the Stifel analysts also say central London

office markets are more resilient, which "may imply upside potential" depending, of course, on

the outcome of Brexit.

On that, here are the latest scenarios:

(Helen Reid)

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TRADE WAR ESCALATION RALLY: INFLATION MAY BE THE KEY (1051 GMT)

Inflation seems to be the missing piece of the puzzle as to why stock markets have reacted

with such panache to Beijing and Washington's escalation of tariffs.

The leading euro zone stocks index is now up an impressive 0.8 percent with

banks and autos leading the way.

On the tariffs, Credit Suisse (IOB: 0QP5.IL - news) global CIO Michael Strobaek notes "Equity markets rallied in

response and bond markets sold off."

"This is consistent with the expectation that, at this stage, the trade conflict still

barely changes global growth but inflation could rise," he explains in today's investment

committee note.

Societe Generale (Swiss: 519928.SW - news) echoes this view.

"Protectionist measures initially lead to higher inflation," strategists predict in their

cross-asset research note. "The U.S. equity market is already pricing in a rebound in growth and

inflation".

Remember the reflation, or "Trumpflation", trade that drove stock markets higher from

November 2016?

Maybe this - through protectionist measures - is how it ends up playing out. Below you can

see how the S&P 500 moves higher with inflation.

(Helen Reid)

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IT'S TIME TO TURN LESS BEARISH ON AUTOS, IT SEEMS (0958 GMT)

Autos is an unloved sector for equity investors, we know, but will that continue for much

longer? Probably there are some brighter times ahead.

Valuations look inexpensive and Kepler strategists say investors should now bring their

exposure back to neutral, adding to signs that broker sentiment towards the under-owned and

underperforming sector is improving. Today autos are leading gainers in Europe.

Here's Thomas Besson, autos analyst at Kepler, giving an account of last night's upgrade

from colleagues at the strategy team:

"They envisage a series of late-year bounces within Europe's depressed value universe in

segments that have been largely abandoned by investors. September and October demand data should

be key tests for such a potential bounce".

"Newsflow has been terrible for Autos over the last months, including warnings from darling

stocks. Weak relative earnings momentum (key driver for the sector this decade) appears to be

stabilising, maybe temporarily. A positive short-term signal," Besson adds.

In this chart we show how the PE valuation gap between the Auto index and the

European benchmark has been widening to fresh highs, as earnings estimates have been

downgraded for 16 weeks in a row.

For another bullish view on European autos, check out Redburn here:

(Danilo Masoni)

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POSITIVE, BUT RATHER FLATTISH OPEN FOR EUROPEAN SHARES (0716 GMT)

European shares have opened in positive territory alright but nothing extravagant really.

The trade-sensitive DAX is having a hard time keeping afloat and the pan-European STOXX 600

is up 0.1 percent.

All in all, this is broadly in line with the close in Asia and with the current levels of

U.S. futures for the S&P 500, the Dow and the Nasdaq (Frankfurt: 813516 - news) .

(Julien Ponthus)

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WHAT'S ON THE RADAR FOR EUROPE: RIO TINTO (Hanover: CRA1.HA - news) , TOM TAILOR (IOB: 0MMJ.IL - news) , SAFESTYLE (0648 GMT)

European shares are set for a mixed start with futures trading between -0.1 and +0.1

percent. The leading euro zone stock index STOXX50E is on track for its ninth straight session

of gains as investors took a more bullish view of the China-U.S. trade war.

A focus for traders will be UK retail sales out this morning at 0830 GMT. Societe Generale

analysts expect retailers’ strong spring and summer to come to an end with August data likely to

show a drop in sales. Euro area consumer confidence out later in the day would also be watched.

On the corporate front a $3.2 billion share buyback programme from Rio Tinto will likely

boost the shares up around 2 percent.

Safestyle could fall 5 percent, traders said, after the window and door retailer and

installer warned on profits and said it does not anticipate an “immediate recovery” back to 2016

and 2017 levels of financial performance. The company’s poor performance adds to indications

Brits are withholding spending on big-ticket home improvement products in an uncertain

environment.

German fashion retailer Tom Tailor issued a profit warning likely to send the shares sinking

by 10 percent, traders predicted.

Inmarsat (Other OTC: IMASF - news) shares are seen rising 2 percent after the British satellite company said it would

collaborate with Japan’s Panasonic Avionics to provide in-flight broadband for commercial

airlines.

The stress in emerging markets is beginning to be felt by some companies with large

operations and revenues from EM: the world’s biggest spirits company said it expects this year’s

selloff in some EM currencies to knock 175 million pounds off net sales and 45 million off

full-year profits.

Lower levels of market volatility, meanwhile, hurt quarterly revenue at trading platform IG

Group.

In dealmaking news or noises Nestle (Swiss: NESN.VX - news) was seen rising 0.5 percent after it said it was

exploring strategic options for its skin health business.

French Connection (LSE: FCCN.L - news) 's half-year loss narrows;

IG Group qtrly revenue drops, hit by lower client activity

Emerging market turbulence to hit Diageo (LSE: DGE.L - news) sales, profit

UK's Kier reports higher FY profit with strong order book

Inmarsat and Panasonic (Swiss: MAELI.SW - news) partner on in-flight connectivity

Safestyle UK Sees Co To Generate Modest Operating Profit In Q4 Of 2018

(Helen Reid)

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EUROPEAN FUTURES OPEN FLAT (0615 GMT)

European futures have opened and are trading roughly flat. Not much action either on U.S.

futures but pre-trading indications are starting to come in. At the moment they're pointing to a

slight dip in BAT shares after the firm announced its CEO's retirement, and a 0.5 percent

increase in Nestle on its exploring strategic options.

(Julien Ponthus)

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EURO CONSUMER CONFIDENCE, UK RETAIL SALES IN FOCUS (0557 GMT)

On the economics front consumer confidence figures for the euro area will come out at 1400

GMT, while UK retail sales at 0830 GMT will give a read on the health of the British consumer.

"We expect Euro Area's consumer confidence to have mildly recovered in September, while UK

retail sales are expected to have corrected in August, after a good run in recent months," write

analysts at Societe Generale.

"Sales have had a sensational spring and summer," they add, saying in the August retail

sales data "it will finally be time for some limited payback". SocGen (Paris: FR0000130809 - news) predicts a fall of 0.5%

month-on-month, giving the usual strong caveats as the data is highly volatile.

(Helen Reid)

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EARLY MORNING HEADLINE ROUND-UP (0543 GMT)

Not much in the way of results this morning but some M&A news and share buybacks to keep

traders busy.

Rio Tinto announced a massive $3.2 billion share buyback programme - split between an

off-market share buyback for Australia-listed Rio Tinto shares plus further on-market purchases

of UK-listed Rio Tinto plc.

Nestle is exploring strategic options for its skin health unit as part of its increase in

focus on food, drinks and nutritional health products.

And in news after yesterday's close, Spanish bank Santander has transferred tens of billions

of pounds of assets and liabilities to its Madrid-based parent group in order to comply with new

ring-fencing rules coming into force in 2019.

Nestle to examine 'strategic options' for skin health unit

Rio Tinto announces $3.2 bln share buyback programme

British American Tobacco (Kuala Lumpur: 4162.KL - news) has candidate to replace retiring chief exec

Moncler Q3 "going well", says CEO at Milan Fashion Week

Volkswagen (IOB: 0P6N.IL - news) pulls out of Iran, according to U.S. official - Bloomberg

Santander shifts assets to Spanish parent to ring-fence UK unit

(Helen Reid)

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MORNING CALL: TRADE WAR RELIEF CONTINUES TO BUOY EUROPEAN STOCKS (0516 GMT)

European stocks are set to continue their rally this morning as investors price in a more

positive scenario for the China-U.S. trade war.

If the leading euro zone index keeps up its momentum it could clinch its ninth

straight session of gains, climbing to its highest in two weeks.

Asian stocks followed global indexes higher, as investors took a less bearish view on the

impact of the U.S.-China trade war on markets, a sharp contrast to dim expectations economists

had on U.S. growth amid the worsening tensions.

Spreadbetters expect London's FTSE to open 7 points higher at 7,338, Frankfurt's DAX to open

8 points higher at 12,227 and Paris' CAC to open 4 points higher at 5,398.

(Helen Reid)

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