February 14, 2018 / 10:28 AM / 6 months ago

LIVE MARKETS-Is Brexit-hit corporate Britain spared from Bridgewater's short?

    * European stocks futures rise
    * U.S. inflation in focus
    * Asian shares mixed

    Feb 14 (Reuters) - 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. Reach him on
Messenger to share your thoughts on market moves: julien.ponthus.thomsonreuters.com@reuters.net
    
        
    IS BREXIT-HIT CORPORATE BRITAIN SPARED FROM BRIDGEWATER'S SHORT? (1024 GMT) 
    Well apparently: according to the data provided to the UK regulator, there are no
short-positions taken against blue-chip British companies by Bridgewater, as opposed to German
corporate titans, which are among the targets of the world's biggest hedge fund.
    According to EU regulations, short positions bigger than 0.5 percent of the capital of an
issuer must be disclosed to the bourse's watchdog. 
    Check out the data yourself here: bit.ly/2G0fH4C 
    This comes as a surprise as BAML's fund manager survey pointed out yesterday: "UK equities
have been underowned for 47 consecutive months. Currently global fund managers are net 36%
underweight the region."
    Seems unfair for Germany but this could be karma striking back after a German carnival made
fun of how Theresa May is handling the Brexit issue.    
 
    (Julien Ponthus, Helen Reid and Reuters' markets team)
    *****
    
    
    OPENING SNAPSHOT: EUROPEAN SHARES BOUNCE (0818 GMT)
    A rise among financials has helped European shares to open in positive territory, led by
Natixis and Credit Suisse, both up around 3 percent following their updates.
    Credit Agricole, however, is down 2 percent after its Q4 results.
    Even though we're seeing broad-based gains at the open, the STOXX 600 is still stuck at
five-month lows, and trading is likely to be hot and cold with the U.S. inflation figure around
the corner. 
    Here's your opening snapshot:
    
 
    (Kit Rees)
    *****
    
    ROSES ARE RED, VIOLETS ARE BLUE, SO BUY THE DIP, WHY DON'T YOU? (0755 GMT) 
    It's Valentine's day and Citi is telling us that investors shouldn't fall out with equities
just now, even if the incoming inflation data this afternoon is keeping markets fairly nervous. 
    "Citi Strategists Say Buy The Dip", says their morning note which states that "regional
equity strategists think that this market setback represents a buying opportunity". 
    "Our Bear Market Checklist agrees, with only 3.5/18 factors flagging sell", it says and
adds: "Investors should stick with equities but hedge their exposure by moving Underweight
credit and long equity volatility once markets have settled".  
 
    (Julien Ponthus)
    *****  
    
     
    EARNINGS AHOY! (0746 GMT)
    On a busy day of earnings, especially for the banking sector, here's a round-up of the key
headlines on the company and macro front so far this morning:
    
    Credit Agricole says its French retail bank has reached turning point
    French bank Natixis posts surprise rise in quarterly profit
    Credit Suisse posts third straight annual loss on US tax writedown
    Steel unit boosts Thyssenkrupp profit ahead of Tata Steel tie-up
    Salmon farmer Marine Harvest to cut costs as earnings, dividend drop
    H&M sees profit rise in 2018 as online sales grow
    Haldex Q4 core profit rises, says heavy investment to dent 2018 margins

    Clariant 2017 profit misses estimates after turbulent year
    Dutch chemical firm DSM's Q4 profit beats expectations
    Bilfinger sees further organic growth in orders in 2018
    Food group Danone to sell 14 percent stake in Japan's Yakult
    Moncler launches 'Genius' creative hub in new product strategy
    BUZZ-EDP: Possible takeover target for Gas Natural - CS
    BUZZ-Ferrari: SUV and EV strategy adds risk - MS
    German exports drive solid growth in fourth quarter 2017
    Coca Cola HBC AG Posts 4.9 Pct Rise In ‍Reported FY Net Sales Revenue
    Sky wins bulk of Premier League rights as value slips
    British construction group Galliford Try looks to raise 150 mln stg
    Spreadbetter Plus500 sees 2018 revenue ahead of market expectations
    (Kit Rees)
    *****
    
    WHAT'S ON THE RADAR AHEAD OF THE OPEN (0730 GMT) 
    European markets are expected to open in positive territory but all eyes are really on the
U.S. inflation data, which will come in early afternoon and will determine the fate of this
session. 
    In the meantime, a steady flow of corporate results and M&A will give traders enough to gnaw
on while waiting for the big numbers.
    In the banking sector, Credit Suisse posted a third straight annual loss but it was smaller
than expected. Credit Agricole saw a 33 percent jump in quarterly profit while French investment
bank Natixis last evening reported an unexpected rise in quarterly net profit.
    For cyclicals, Thyssenkrupp Q1 operating profit is up 35, Dutch chemical firm DSM's Q4
profit beat expectations and Clariant 2017 profit missed estimates after a turbulent year.
    Swedish brake systems maker Haldex reported a rise in fourth-quarter core earnings but said
investments in development and expansion in North America and China would hold back
profitability in 2018.    
M&A: Danone to sell 14 percent stake in Japan's Yakult.
In the UK, Sky won the bulk of Premier League rights.  
    (Julien Ponthus) 
    *****
        
    EUROPE TO OPEN IN POSITIVE TERRITORY, FUTURES INDICATE (0705 GMT)
    Looks like European bourses are set to open on a positive note, but of course, the rest of
the session is largely expected to depend on the U.S. inflation data, which is to be published
at 1330 GMT.     
 
    (Julien Ponthus)
    *****  
    
    A "POWELL PUT"? (0657 GMT) 
    The incoming U.S. inflation data is sure keeping markets on their toes and it's interesting
to note that the new Federal Reserve Chair Jerome Powell's first words at a ceremonial
swearing-in was that the central bank would keep watching for financial stability risks. 
    "We will remain alert to any developing risks to financial stability", Powell said on the
heels of a market rout that shaved 10 percent from the value of major U.S. stock indexes.
    A lot of analysts are still trying to figure out how Powell would react to a melt-down and
wondering whether there would be such as thing as a "Powell Put", in the same way that the
so-called "Greenspan Put" came to the rescue in 1987. 
    On Monday, Stéphane Déo, strategist for LBPAM, asked himself whether the "Greenspan Put" had
disappeared and what to make of the old saying recently used by Bank of America Merrill Lynch
analysts: "Markets stop panicking when central banks start panicking".
    In the meantime and as far as we are concerned today, as said Greg McKenna, chief market
strategist at CFD and FX provider AxiTrader: "Even a slightly higher number could set the cat
among the pigeons given the late cycle stimulus the Trump Administration is pumping into the
U.S. economy".     
 
    (Julien Ponthus)
    *****
    
    MORNING CALL: SLIGHTLY UP AHEAD OF U.S. INFLATION (0615 GMT)
    Good morning and welcome to Live Markets.
    Early indications from spreadbetters point to Europe opening slightly in positive territory
after a mixed session in Asia. All eyes however are on the U.S. inflation data which could
soothe, or inflame, fears of faster rate hikes globally.
    London's FTSE is seen opening 15 points higher, Frankfurt's DAX 46 points higher and Paris
CAC up 17 points. 
    (Julien Ponthus)
    *****

    
 (Reporting by Danilo Masoni, Helen Reid, Kit Rees and Julien Ponthus)
  
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