MORNING BID EUROPE-UK's May wins only words from EU

* A look at the day ahead from European Economics and Politics Editor Mark John and EMEA markets editor Mike Dolan. The views expressed are their own.

LONDON, Dec (Shanghai: 600875.SS - news) 14 (Reuters) - UK opposition Labour is demanding Theresa May bring her Brexit deal back to parliament after she managed to get no more than reassuring words from Brussels last night on how the Irish backstop is not intended to trap the UK inside the European Union's orbit. Labour knows that will not be enough to satisfy critics of the deal in her own ruling party or the DUP on whom she relies for her majority. For that reason, she is of course unlikely to go anywhere near the House of Commons with it anytime soon. EU diplomats said May indicated she would want to come back for more assurances with legal force at a later date before a January showdown. Separately, proponents of a second referendum are pushing their case. Former PM Tony Blair will make a speech in Brussels arguing that preparations should be put in place now because parliament will probably fail to agree on a divorce deal and the public will need to break the deadlock.

Officially, it is the last day of the UN climate change summit hosted by Poland and intended to ensure national promises on cutting carbon emissions are actually stuck to. The reluctance of Donald Trump's America and others to engage wholeheartedly has cast something of a pall over the whole meeting, to the alarm notably of small island states most endangered by rising ocean levels. A draft text has been thrown together but disputes remain over key issues, ranging from how to fund moves to cut emissions right through to how such efforts are monitored and then reported. There is a fair chance that talks will go through into the weekend.

Kosovo's parliament is due to vote today on whether to create a national army despite objections from Serbia and concerns expressed by NATO. Serbia's premier has even warned that going ahead with the plan could provoke a military intervention by Belgrade, two decades after Kosovo Albanians' uprising against Serbian rule led to the controversial creation of a country for them. Although Belgrade is considered highly unlikely to follow through on such a threat, local tensions remain high - a fact which could undermine further progress towards the EU membership that both seek.

MARKETS AT 0755 GMT It’s grim out in China these days – that’s the message all economic data seem to be sending. Today’s November retail sales – the weakest since 2003 -- and industrial output growth at the slowest in three years offer another reminder of the toll the trade war is taking on the world's big economies. That’s pushed the yuan lower, while mainland shares are down 1.5 to 2 percent and the rest of Asia is also down sharply.

World stocks are down as well, although still on track for a modest weekly gain. But those could well be wiped out by the time the New York session closes -- futures for the S&P500 are down 0.8 percent after yesterday’s jittery session. In short, everything exposed to trade war risks is suffering. The dollar is firmer, exerting more pressure on emerging markets, where stocks are set for a second week of losses. In fact, the dollar is set for its biggest weekly rise since September, confounding those who had called the end of its eight-month resurgence.

Sterling is down 0.4 percent as the EU makes it clear there is to be no fresh Brexit deal and "take it or leave it" is the extent of the choice the UK has. Is there any good news out there? Italian bonds and banks have done well this week: Rome agreed to cut the deficit in its draft 2019 budget, setting of a rally in its bonds. Yields on this year's worst-performing euro zone bond market have fallen for the fourth straight week – they are down more than 15 bps so far this week.

On the data front, December PMIs are due from France, Germany, and the euro zone and the United States releases retail sales, industrial production and PMIs. But European shares have already had the wind taken out of their sails from data showing terrible car sales in November and of course the Chinese retail report's impact is being felt – the luxury goods sector is being marked down as much as one percent

Germany's DAX, whose carmakers are particularly sensitive to the health of the Chinese economy, has opened as much as 0.9 percent weaker. European auto shares have lost 1.6 percent data showed a drop in European car sales last month. There are worries about slowing demand following the introduction of tougher new emissions tests. UK homebuilders are getting whacked again, down more than 2 percent one the usual Brexit woes.

Otherwise, M&A news has captured the headlines: France's LVMH has agreed to buy U.S. hotel chain Belmond (NYSE: BEL - news) in a deal worth $3.2 billion. Shares (Berlin: DI6.BE - news) are down 2.5 percent. Sweden's Intrum has announced plans to buy Banco Sabadell's real estate servicer Solvia, aiming to strengthen its foothold in the Spanish market. German online classified-ads firm Scout24 (IOB: 0RB8.IL - news) is exploring a sale that could see it taken private in one of the country's largest leveraged buyouts in years, according to the FT. The shares have jumped 15 percent. More good news for Huawei rivals Nokia (Milan: 23568.MI - news) and Ericsson (Hanover: ERCB.HA - news) as Deutsche Telekom (IOB: 0MPH.IL - news) , Europe's largest telecoms company, said it was reviewing its network vendor strategy in light of a debate on the security of Chinese network equipment that it was taking "very seriously".

Emerging-market stocks are down 1 percent on the day. The Turkish lira and Indian rupee lead a lengthy list of EM currencies which are down two weeks on the trot. The yuan is marginally lower. The central bank of Russia announces its interest rate decision at 1030 GMT. It's expected to hold rates but the tone of its message will be key. Upcoming events on Friday: China Nov industrial output, retail sales, urban investment Dec flash PMI business surveys from around the world Europe corp events: Balfour Beatty (Other OTC: BAFBF - news) (trading). Italy Oct industrial orders/sales Italy/Spain final Nov inflation EZ Q3 labour costs ECB Vice President de Guindos speaks in Frankfurt; ECB supervisory board member Angeloni speaks in Rome EU Summit in Brussels Russian central bank policy decision US Nov retail sales, industrial production Sovereign credit rating reviews – Moody’s reviews Kuwait, Isle of Man (Swiss: MAN.SW - news) . S&P reviews Senegal, Serbia, Slovenia, Uganda. Fitch reviews Turkey, Denmark, Ireland (Other OTC: IRLD - news) , Cape Verde. DBRS reviews UK, Denmark, Estonia (Editing by x x)