LIVE MARKETS-What's on the radar for the European open
July 19 - 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 THE RADAR FOR THE EUROPEAN OPEN (0647 GMT)
European stocks are set to falter at the open as investors lock in profits after a rally
took benchmarks to one-month highs yesterday.
Earnings season is in full swing with several heavyweights in consumer goods and industrials
reporting.
Disappointment from consumer giant Unilever (NYSE: UL - news) could weigh on the sector. The Anglo-Dutch maker
of ice cream to soap blamed a Brazilian transport strike and weak pricing for its lower than
expected second-quarter sales growth. Weak pricing was one of investors’ main concerns for the
consumer staples stocks last quarter, too, causing some sharp stock falls.
Industrials reported strong results overall, with Swiss engineering company ABB (LSE: 0NX2.L - news) beating
profit forecasts though its sales were weaker and it warned about rising geopolitical
uncertainties. Truckmaker Volvo’s profit also topped forecasts, perhaps providing a sentiment
boost to the autos sector hit by tariff fears. France’s Alstom (LSE: 0J2R.L - news) and Sweden’s SKF (LSE: 0NWW.L - news) also reported
strong results.
And tech stocks, which led gains on Thursday, could extend their rally after Europe’s
biggest tech company, SAP (Amsterdam: AP6.AS - news) , raised its outlook on forecast-beating results thanks to growth in
its cloud business.
Nordea, the Nordic region’s biggest bank is indicated up 1 percent after its second quarter
profit topped forecasts, though it said revenues were unlikely to reach last year’s level in
2018.
And UK engineer Babcock lowered its full-year revenue outlook; its shares are
seen down 5 to 10 percent at the open.
(Helen Reid)
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FUTURES POINT TO LACKLUSTRE OPEN (0613 GMT)
European benchmark futures are trading down 0.1 to 0.2 percent across the board, indicating
the recent rally will peter out today as investors take profits.
It's a heavy day for earnings meaning results will likely drive more movement underneath
index levels.
Adding to the list of earnings out so far, consumer goods giant Unilever has just reported
lower than expected second-quarter sales, hurt by a Brazilian transport strike and weak pricing.
The latest headlines:
Unilever second-quarter sales disappoint
Sweden's SKF Q2 profit beats forecast, sees higher demand in Q3
French group Alstom posts higher Q1 sales
Roche Tecentriq cocktail cut lung cancer risk, survival data still to come
(Helen Reid)
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EARLY MORNING EARNINGS ROUND-UP (0539 GMT)
Trade war risks and currency risks are the main issues flagged by companies reporting today
thus far. Swiss industrials giant ABB warns geopolitical risks are rising, while unlisted Volvo
Cars said it was on track for another sales record despite trade tensions - perhaps a positive
sign for the autos sector.
Here's your results round-up:
Publicis (Paris: FR0000130577 - news) stumbles on health unit underperformance in 2nd quarter
ABB warns on rising geopolitical risks after Q2 profits beat forecasts
SAP raises outlook as cloud growth "unleashed"
Volvo Cars targets sales record, facing down trade worries
Innogy agrees with E.ON and RWE (IOB: 0FUZ.IL - news) on planned transaction
Nordea Q2 profit narrowly tops forecast
Givaudan (LSE: 0QPS.L - news) profit falls as currency losses in Argentina bite
Essity Q2 core profit slides as higher pulp prices weigh
(Helen Reid)
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MORNING CALL: EUROPEAN RALLY TO STALL (0531 GMT)
European shares are set to take a breather this morning after earnings optimism took
regional benchmarks to a one-month high on Wednesday.
Asian shares extended early gains overnight as upbeat Wall Street earnings buoyed global
investor sentiment, although trade war jitters pushed China's yuan to fresh one-year lows in
both the onshore and offshore markets.
On the radar today are updates from ABB, Alstom, Anglo American (LSE: AAL.L - news) , Kone (LSE: 0II2.L - news) , Kuehne & Nagel,
Publicis, Unilever, Volvo, among other big European companies.
Spreadbetters CMC Markets expect the FTSE 100 to open unchanged at 7,676 points, the DAX to
open 17 points lower at 12,748 and the CAC 40 10 points lower at 5,437.
(Helen Reid)
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(Reporting by Helen Reid, Danilo Masoni, Julien Ponthus and Kit Rees)