* Euro STOXX reduces gains, up 0.4 pct
* U.S. bank earnings awaited
* EuroSTOXX 50 volatility gauge falls back
* Bank, tech stocks drive the market

Oct 12 – 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

MORE THAN HALF THE MSCI WORLD IS IN A BEAR MARKET (1041 GMT)
BAML strategists have the scores on the doors in their flow show piece – and it doesn’t look
good.
* 1557 global stocks out of 2767 – or 56% of the MSCI ACWI – are in a bear market (>20%
decline)
* U.S. Treasuries are on course for 3rd largest annual loss in 40 years
* 16 of 21 commodity markets are in correction (>10% price decline)

BAML’s indicator of breadth of the market, which measures the percentage of global stocks
trading below their 200-day moving average and 50-day moving average, triggered a “buy” signal
as the ratio hit 89% (see below).
But the strategists don’t think it’s time to buy back into stocks yet, saying “we remain
fundamentally bearish on peak policy & peak profits… we respect technicals and seasonality but
will sell the rally”.

(Helen Reid)
*****

A HALF-HEARTED BOUNCE REVEALS LINGERING JITTERS (1032 GMT)
Today’s bounce looked strong at first but investors seemed to curb their enthusiasm pretty
swiftly, leaving indexes at about half their opening gains. The Euro STOXX is up 0.3
percent while the DAX is up 0.5 percent and the FTSE 100 0.7 percent.
There’s clearly still some anxiety in the air, and investors are also likely sitting on
their hands ahead of results from the big U.S. banks in a couple of hours.
(Helen Reid)
*****

WHAT’S ON OUR RADAR: A BOUNCEBACK TO END A TURBULENT WEEK (0648 GMT)
A rebound in Asian shares (which excluded China) was set to spread to Europe on Friday with
futures extending gains up 0.7 to 1.3 percent across the main euro zone and UK benchmarks. If
the bounce is sustained the euro zone STOXX could make up some of this week’s heavy losses which
have left it on track for its worst week since the February selloff.
Positive comments from the IMF could help cement Europe’s bounceback: the head of the IMF’s
European unit said the direct impact of potential U.S. car tariffs on Europe would be relatively
limited, though they could still affect investor sentiment.
Investors’ eyes will be on U.S. banks today kicking off the Q3 earnings season, a crucial
test for both U.S. and European markets which have shown how flimsy they can be in recent days.
Europe’s big brewers ABInBev and Carlsberg could be moved by a source-based Reuters report
that India’s antitrust watchdog raided their offices in at least two Indian cities as part of an
investigation of price-fixing allegations.
In the UK results from more asset managers are likely to move shares after Jupiter and
Hargreaves Lansdown disappointed on Thursday. Both Man Group’s and Ashmore’s funds under
management rose thanks to market gains and net inflows.
In other company news or stock movers:
Atalaya Mining to explore strategic options
Sports Direct buys Glasgow department store Frasers for 95 mln stg
Man Group Q3 assets up 0.4 pct on inflows
Inflows buoy Ashmore Q1 assets, up 3 pct to $76.4 bln
(Helen Reid)
*****

EUROPEAN FUTURES UP STRONGLY (0622 GMT)
Futures have opened up strongly across European benchmarks, with the Eurostoxx 50 futures up
0.9 percent, DAX futures up 0.8 percent and FTSE 100 futures up 0.5 percent.

(Helen Reid)
*****

EARLY MORNING HEADLINES ROUND-UP (0554 GMT)
All eyes will be on Wall Street’s banks kicking off the reporting season later on today, but
here are the potentially stock-moving headlines so far.
In interesting consequences of the stock selloff, sources say Tencent Music is delaying its
$2 billion U.S. IPO. News the Gulf of Mexico’s oil output has been cut by 40 percent due to
Hurricane Michael is helping support oil prices rebounding after two days of heavy losses.
Lockheed, Rheinmetall to make joint bid to supply German navy helicopters
EXCLUSIVE-Top brewers raided by Indian watchdog in price-fixing probe -sources
Italy’s Carige to look at naming investment bank for tie-ups
Italy could have around 15 pct of new Alitalia, Italy railways on board
Virgin’s Branson halts talks on $1 bln Saudi investment in space ventures
EXCLUSIVE-Shell seeks to sell Venezuela JV stake to France’s Maurel & Prom -sources

U.S. Gulf of Mexico oil output cut by 40 percent on Hurricane Michael -BSEE
Tencent Music delays $2 bln U.S. IPO due to weak markets – sources
India to raise import tariffs on electronic and communication items
Vonovia Buys Stake in Residential Portfolio From SNCF As Part Of Consortium
Brexit negotiators eye Monday breakthrough, N.Irish party ups the ante
(Helen Reid)
*****

MORNING CALL: RESPITE FOR EUROPEAN STOCKS? (0526 GMT)
European stocks look set for a bounce today after a stronger session in Asia overnight. Wall
Street extended its slide into a sixth session before that, though, and the Nasdaq flirted with
correction territory, down as much as 10.3 percent from its Aug 29 closing record high.
Asian shares found a slightly firmer footing to set course for their first gains in two
weeks, but the rout continued in Shanghai where shares hit lows last seen in 2014.
The euro zone’s STOXX is currently set for its worst week since February, but that may
change if the bounce proves material.
Spreadbetters expect London’s FTSE to open 27 points higher at 7,034, Frankfurt’s DAX to
open 110 points higher at 11,649 and Paris’ CAC to open 53 points higher at 5,160.
(Helen Reid)
*****

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

(c) Copyright Thomson Reuters 2018. Click For Restrictions – https://agency.reuters.com/en/copyright.html





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