LIVE MARKETS-What's on our radar ahead of the open
June 11 - 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'S ON OUR RADAR AHEAD OF THE OPEN (0651 GMT)
European stock futures are indicating a strong start, shrugging off the fallout from a tense
G7 meeting over the weekend with gains of 0.3 to 0.7 percent for the major benchmarks.
At the start of a week packed with political and central bank events, with an historic
summit between the U.S. and North Korea on Tuesday followed by Fed and ECB meetings, investors
in Europe are choosing to look beyond the G7 meeting Societe Generale (Swiss: 519928.SW - news) analysts branded
“shambolic”.
They are also likely expressing relief that Swiss voters rejected, by a landslide, a
campaign to radically alter the country’s banking system. The “no” vote pushed the Swiss franc
down, which could deliver a boost to Swiss exporting stocks. The new Italian economy minister’s
vow to stay in the euro and cut debt levels was sending Italy’s bonds higher and is likely to
lure relieved investors back into Italian stocks, too.
M&A is still rampant in the UK stock market. Ones to watch today include Inmarsat (Other OTC: IMASF - news) which,
after a sharp rally on bid speculation on Friday, confirmed after the close that it had rejected
a takeover offer from U.S. firm EchoStar.
British car auctioneers BCA Marketplace (LSE: BCA.L - news) could also be moved by news private equity firm Apax
Partners (IOB: 0QOQ.IL - news) is considering making an offer for it. It’s not alone in the private equity dealmaking
space: Bernstein analysts said the share of deal activity taking companies private has reached a
peak last seen in 2007.
Ocado could also be a mover after a double upgrade to “outperform” from Bernstein – a bold
call for a stock already up 152 percent this year.
On the negative side, Daimler (IOB: 0NXX.IL - news) shares could be dented after the Bild am Sonntag reported the
German regulator found defeat devices in its diesel cars. And Rolls Royce shares are indicated
down 1 percent after it said a problem affecting the durability of its Trent (BSE: 500251.BO - news) 1000 engine had
been discovered in another engine type, requiring further inspections.
In other company news/potential stock movers:
German regulator found defeat devices in Daimler diesel cars -BamS
Rolls-Royce says compressor issue found in different Trent 1000 engine
EDP sees merits in Chinese suitor's plans, but offer too low
(Helen Reid)
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FUTURES POINT TO MODEST GAINS AT THE OPEN DESPITE "SHAMBOLIC" G7 (0609 GMT)
Futures for the leading European stock benchmarks are up 0.1 to 0.3 percent, indicating a
stronger open.
There's not much on the macroeconomic front expected today but Societe Generale analysts say
investors will be watching the Bank of France business sentiment and UK construction and
manufacturing output - a slow start to a heavy week of political and central bank events.
Here's SocGen (Paris: FR0000130809 - news) 's take on the G7 fallout: "After some initial wobbles at the open, markets in
Asia took the shambolic end to the G7 summit in their stride, regardless of the fact that on the
surface the risk of a further escalation of U.S. protectionist measures has increased."
And some extra headlines that could shake up trading, with M&A still rampant in the UK
market:
Comcast (Swiss: CMCSA.SW - news) to win unconditional EU okay for Sky (Frankfurt: 893517 - news) bid - sources
British watchdog probes reports that meat found in vegetarian meals
Apax considering an offer for BCA Marketplace
Inmarsat rejects EchoStar takeover bid, says it undervalues firm
(Helen Reid)
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EARLY MORNING HEADLINE ROUND-UP (0537 GMT)
The G7 fallout includes a further souring of U.S.-Canada relations, and a promise from
German Chancellor Merkel to act against U.S. tariffs on steel and aluminium. She (Munich: SOQ.MU - news) also said
Trump's decision to pull out of the G7 communique via tweet was "sobering and a bit depressing".
In Europe investors will be relieved that the Swiss rejected a plan to transform the
country's financial landscape by barring commercial banks from electronically creating money
when they lend, in a landslide referendum vote.
On the corporate front Swiss chemicals firm Sika (IOB: 0QMA.IL - news) is on a massive takeover drive, and French
energy stocks could be moved by the energy market regulator's plans to recommend higher natural
gas energy prices.
Sika targets up to $1 bln in takeovers a year to quicken growth
U.S.-Canada dispute escalates after tense G7; Trump renews criticism of Trudeau
Swiss voters reject campaign to radically alter banking system
With (Other OTC: WWTH - news) sales boom in mind, Gucci tightens grip on suppliers
French energy regulator to recommend higher natural gas prices
Merkel: EU will act against U.S. tariffs on steel, aluminium
Caixabank To Buy 51 Pct Of Servihabitat Servicios Inmobiliarios For 176.5 Mln Euros
(Helen Reid)
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MORNING CALL: EUROPEAN SHARES TO SHAKE OFF G7 SHOCK (0514 GMT)
European stock benchmarks are seen opening stronger this morning after an early wobble in
Asian trading after U.S. President Donald Trump backed out of a joint G7 communique over the
weekend.
The clear lack of a united front among the group dented Asian shares, but they went on to
recover and edge higher as investors looked ahead to an historic U.S.-North Korea summit on
Tuesday.
Investors have also this week to get their heads around a two-day Fed meeting starting
tomorrow, and an ECB meeting on Thursday at which policymakers could signal intentions to start
unwinding the bank's massive bond purchasing programme.
At the start of a busy week, spreadbetters call the DAX 20 points higher at 12,787, the CAC
40 down 4 points at 5,446, and the FTSE 100 16 points higher at 7,697.
(Helen Reid)
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(Reporting by Danilo Masoni, Helen Reid, Kit Rees and Julien Ponthus)