European Factors to Watch-Market seen consolidating strong gains

Wed Feb 20, 2013 1:18am EST

LONDON, Feb 20 (Reuters) - European stocks are seen opening broadly flat on
Wednesday, consolidating the previous session's strong gains as investors digest
a bumper crop of results and economic data to gauge the sustainability of the
rally.
    Financial spreadbetters expected Britain's FTSE 100 to open 1 to 8
points lower, Germany's DAX to add around 5 points, and France's CAC 40
 to be broadly unchanged. 
    The slightly weaker showing for the FTSE comes as several companies trade
ex-dividend, taking around 8 points off the index. 
   The bourses finished higher on Tuesday, with the pan-European FTSEurofirst
300 index closing up 1.1 percent at 1,171.73 points - its best finish in three
weeks - thanks to forecast-beating German data. 
    The upbeat investor sentiment continued overnight with Wall Street closing
in on record highs and Asian shares hitting 18-month highs
. 
    However, analysts say that for the gains to be sustained in the longer term,
economic data and corporate earnings need to catch up with the relatively upbeat
investor sentiment. Tuesday's strong German ZEW investor sentiment index aside,
so far there are few signs of this happening.
    To date, with around a third of STOXX Europe 600 companies having reported
full-year results, 40 percent have missed on earnings, prompting analysts to
downgrade 2013 forecasts by 2.3 percent, according to Thomson Reuters StarMine. 
  
    The earnings season gathers pace on Wednesday, including reports from Accor
, Akzo Nobel, Credit Agricole and France Telecom
. 
    The data calendar is also relatively heavy, including numbers on UK
unemployment and U.S. housing starts.
    Heavyweight energy stocks could suffer from a retreat in oil prices after
industry sources said Saudi Arabia expects to raise its output in the second
quarter to satisfy higher demand from China. 
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  MARKET SNAPSHOT AT 0609 GMT: 
                                          LAST     PCT CHG    NET CHG
 S&P 500                              1,530.94      0.73 %      11.15
 NIKKEI                              11,468.28      0.84 %      95.94
 MSCI ASIA EX-JP                        560.96      0.97 %       5.40
 EUR/USD                                1.3411      0.19 %     0.0025
 USD/JPY                                 93.15     -0.44 %    -0.4100
 10-YR US TSY YLD                        2.024          --       0.00
 10-YR BUND YLD                          1.634          --       0.01
 SPOT GOLD                           $1,606.54      0.15 %      $2.33
 US CRUDE                               $96.73      0.07 %       0.07
 
  > GLOBAL MARKETS-Asian shares hit 18-month high on growth hopes 
  > US STOCKS-M&A deals lift Wall Street shares nearer a record high 
  > Nikkei hits 52-month high, but Japan Tobacco weighs 
  > TREASURIES-U.S. bond prices fall as stock gains pare bids 
  > FOREX-Yen edges up vs dollar; kiwi slides on RBNZ comments 
  > PRECIOUS-Gold hovers around 6-mth lows, economic recovery hopes weigh 
  > METALS-London copper bounces from 3-week low on rising risk appetite 
  > Brent slips toward $117 as Saudi to raise crude output
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