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(Bloomberg) -- European shares closed flat on Wednesday following a roller-coaster session, trimming an earlier sharp slide fueled by worries about the spread of the coronavirus outside of China.The Stoxx Europe 600 Index ended the day little changed as a rise in carmakers and utilities tempered losses in travel shares, and as U.S. stocks rallied. The European benchmark earlier tumbled as much as 2.9%, at one point wiping out all the gains made since late October.European equities slumped in the past four sessions as the spread of the virus outside of China revived worries over the potential impact on economic growth and corporate earnings. Just last week, the Stoxx 600 index had jumped to a fresh record high, making it vulnerable to sudden negative news.“European indices have a higher sensitivity to global growth,” said Edward Park, deputy chief investment officer at Brooks Macdonald Asset Management. “The Italian outbreak makes the virus a local issue and there are concerns over whether European fiscal stimulus will be forthcoming.”The sell-off in the Stoxx 600 wiped out as much as $1.2 trillion in market capitalization versus the record high the benchmark hit on Feb. 19.Italy reported more infections from the Lombardy region on Wednesday, while guests were still confined to a hotel in Tenerife and Greece reported its first case.Greece’s ASE Index slid 2.7%, on track for the worst performance among global equity benchmarks in February. Italy’s FTSE MIB Index halted a sharp four-day slump and rose 1.4%, led by Enel SpA and Fiat Chrysler Automobiles N.V.“The coronavirus outbreak is challenging as it is both a supply side and a demand side shock,” said Mark Phelps, chief investment officer of global concentrated equities at AllianceBernstein in London. “Clearly China is much more integrated into the global economy that during previous outbreaks, particularly in Europe. This means the virus is likely to have a greater impact on Europe than the U.S.”Most Stoxx 600 industry groups were still in the red on Wednesday. Carmakers were up 1.3%, buoyed by PSA Group as the Peugeot maker rallied after raising its dividend and offering assurances to investors it can withstand a deepening slump.Iberdrola SA rallied 5.1% after saying it expects sharp growth in profit this year, driven by rising power output after earlier investments in renewable energy and transmission assets ramped up.Travel stocks plunged the most, with Ryanair Holdings Plc and InterContinental Hotels Group Plc dropping 1.8% and 1.1% respectively. The Stoxx 600 Travel & Leisure Index has tumbled 10% since Feb. 19, the most among industry groups.“Investors don’t like unpredictable things and the virus is very unpredictable,” Raphael Pitoun, an equities fund manager at CQS, said by phone. “If the virus doesn’t stop and there are new epicenters emerging that are critical to the world economy, I don’t think anyone is going to say that this was a healthy market correction.”\--With assistance from Filipe Pacheco and Anooja Debnath.To contact the reporters on this story: Ksenia Galouchko in London at email@example.com;Namitha Jagadeesh in London at firstname.lastname@example.orgTo contact the editor responsible for this story: Blaise Robinson at email@example.comFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Follow Bloomberg on Telegram for all the investment news and analysis you need.In Japan’s gusty northeast, a power company is looking to fund offshore wind projects with a landmark sale of green bonds that seeks to muscle in on the growing pool of money available for environmentally friendly investments.Tohoku Electric Power Co. plans to price what would be the debut green note from a Japanese utility with its 5 billion yen ($46 million) offering of 10-year securities on Thursday.The utility recently got certification from the Climate Bonds Initiative, an international not-for profit organization that created the first green-bond standard in 2010. Tohoku Electric Power officials said in an interview at the company’s headquarters in the northeastern city of Sendai that it did so to try to attract overseas investors.“Green bonds would help attract investors who haven’t bought our bonds yet,” said Yasunori Majima, manager at the utility’s accounting and finance department, adding that it had received positive feedback from foreign asset managers.Utilities have fallen behind in Japan’s surge toward feel-good investments because they are still largely reliant on coal generation, but the planned issuance highlights how the sector is taking steps to meet climate goals. Tokyo Electric Power Co. Holdings Inc., the utility behind the worst nuclear disaster since Chernobyl, is also considering funding renewable energy with green or sustainable debt.While the utility sector is one of the biggest issuers of straight bonds in Japan, its absence in selling green notes made Tohoku Electric look to trailblazers in Europe such as French utility Engie SA and Italy’s Enel SpA.“While the use of coal has been criticized by environmental groups, we also learned from overseas examples that utilities can issue green bonds as long as the use of proceeds is focused on green projects,” Majima said.Tohoku Electric is seeking to finance seven wind farms and offshore wind projects in Akita, Aomori and Iwate prefectures, as well as a geothermal project in Indonesia. The moves toward green securities came after the utility decided in early 2019 to expand its renewables business, Majima said. Certification from the Climate Bonds Initiative “was not absolutely necessary, but we decided to get it to pursue greater transparency for our first green bonds,” Majima said.While the company hasn’t made any decisions yet, “there’s a possibility that we will be selling green bonds regularly” going forward, he said.(Updates with comment on CBI certification in ninth paragraph.)To contact the reporters on this story: Ayai Tomisawa in Tokyo at firstname.lastname@example.org;Rie Morita in Tokyo at email@example.comTo contact the editors responsible for this story: Andrew Monahan at firstname.lastname@example.org, Beth Thomas, Ken McCallumFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Telecom Italia SpA is close to picking the private equity giant KKR & Co. to help it acquire wholesale fiber carrier Open Fiber SpA, according to people familiar with the matter.Telecom Italia is choosing the U.S. investment firm because it’s also open to purchasing a minority stake in a portion of the Italian company’s landline network, the socalled “secondary network” of copper and fiber lines running from street cabinets to premises, that’s valued by KKR at 7 billion euros ($7.6 billion) to 7.5 billion euros, said the people, who asked not to be named because the discussions are private.Telecom Italia shares rose as much as 3.2% at the market open in Milan, their biggest intraday gain since November. The larger goal is building a single national network, an approach favored by the Italian government led by Premier Giuseppe Conte.Since last year, Telecom Italia Chief Executive Officer Luigi Gubitosi has considered enlisting international funds to help finance a potential network deal with rival Open Fiber, people familiar with the matter said at that time. Gubitosi is also looking to boost demand for premium services, work along with rivals on network investments to cut costs, and spin off noncore assets.Open Fiber’s investors include Italy’s state lender Cassa Depositi e Prestiti and the country’s largest utility, Enel SpA. Francesco Starace, CEO of Enel, said last week in an interview with Börsen Zeitung that he isn’t going to sell the company’s stake in Open Fiber. In contrast, Cassa Depositi would be open to selling its Open Fiber stake, another person said.Spokespeople for Telecom Italia and KKR declined to comment. Representatives for Open Fiber and Cassa Depositi weren’t available after business hours.Open Fiber reported full-year 2018 revenue of 114 million euros. Its active customers numbered 500,000 at the end of that year, and the company reached more than 5 million households with its fiber network.(Updates with share price in third paragraph)\--With assistance from Liana Baker.To contact the reporter on this story: Daniele Lepido in Milan at email@example.comTo contact the editors responsible for this story: Nick Turner at firstname.lastname@example.org;Rebecca Penty at email@example.comFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
* Futures point to lower Wall Street open Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Danilo Masoni. BoE's departing Mark Carney earned his 'unreliable boyfriend' nickname by failing to smoothly guide investors towards his rate decisions. With the market completely split on today's move, Carney was bound, one way of the other, to disappoint.
* Eyes on BoE meeting: rate cut hangs in balance Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Danilo Masoni. Another sign that investors are not quite ready to turn bearish is how value stocks keep on underperforming. "Global value stocks now stand at a record low versus their growth counterparts, having underperformed for the whole of last year and into this year", UBS analysts write in their daily House View.
* Eyes on BoE meeting: rate cut hangs in balance Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Danilo Masoni. Utilities aren't the sexiest industry on the market but over the last month or so they had returns similar to the high-flying FANGs on Wall Street, if not even higher. Surely, worries over economic growth are pushing investors into old-fashioned bond proxies but perhaps there more into it, as climate change fosters huge transformations in the industry and reshapes the whole economy.
* Fevertree falls after Xmas trading update Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Julien Ponthus. This week, eyes will be on the ECB meeting scheduled for Thursday, the first of 2020 and also the first real monetary policy meeting for Christine Lagarde since the previous one in December was effectively her introduction to the world as the new ECB's president. Lagarde is expected to launch the Strategic Review at the Frankfurt meeting, but Royal Bank of Canada is not expecting massive changes.
* Fevertree falls after Xmas trading update Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Julien Ponthus. Once a year, the richest and most powerful people in the world gather together at The World Economic Forum in Davos, Switzerland, to have a chat about the hot topics shaping the world's economy. While the attention on sustainability could be great news for the planet, it might not be that great for European utilities, according to UBS.
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European shares wiped gains and ended lower for a fourth session running on Tuesday as sentiment worldwide took a hit after U.S. President Donald Trump signalled delays to reaching a trade deal with China. London's FTSE, packed with trade-sensitive mining and energy stocks, lost 1.8%%, the most in the region, as material shares lost 1.6%.
Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Julien Ponthus. With new fronts in Brazil, Argentina, Europe and France, the trade war is likely to be the key driver for this session, especially with Trump in the UK for the NATO summit. After the U.S. threatened to slap punitive duties of up to 100% on $2.4 billion of imports from France on products such as champagne or handbags, French companies such as LVMH, Kering and Laurent-Perrier will be closely watched.
European shares posted their biggest daily drop in two months on Monday, with most major markets including Germany and France slumping more than 2%, as a reimposition of U.S. metal tariffs on Brazil and Argentina triggered a decline in global sentiment. After an upbeat November, its third straight month of gains, the pan-European STOXX 600 index closed down 1.6%, erasing session gains after positive factory activity data from China and major euro zone economies had earlier taken it to near four-year peaks.
* U.S. futures point to weaker Wall Street open Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Danilo Masoni. Decent GDP growth path is not too far away as the chances of a resolution of Brexit-induced uncertainty is likely and a sizeable fiscal impulse is on the horizon, Goldman Sachs economists say. With Conservatives being favourites to return to power, Goldman Sachs believes clarity on the UK's terms of exit should emerge faster than under a Labour government.
* U.S. futures point to weaker Wall Street open Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Danilo Masoni. Amid trade war fatigue, European stock markets are once again driven (down about 0.6% at the moment) by Trump commenting on the negotiations with China. Alain Bokobza, head of global asset allocation at SocGen told us during a chat on Tuesday afternoon that reading markets on the short term was more than tricky.
* STOXX 600 hit July 2015 high at yesterday's close Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Danilo Masoni. Madrid is lagging the market as investors brace for more instability after the Socialists and the far-left Podemos party formed a government pact that still lacks majority, following an inconclusive general election - the second this year. The IBEX is down 1.6% and the STOXX is falling 0.8% -- a gap that at a first glance isn't too scaring.
European shares broke a five-day winning streak on Friday after U.S. President Donald Trump said he has not agreed to roll back tariffs on China, adding to uncertainties on whether the two sides were really getting close to signing a partial deal. The pan-European STOXX 600 index ended 0.3% lower after gaining 2.5% over the last five sessions.