European Factors to Watch-Weak Chinese trade data hurts sentiment

Wed Jul 10, 2013 2:22am EDT

LONDON, July 10 (Reuters) - European stocks were set for a cautious start on
Wednesday, after two straight sessions of gains, with miners and exporters
likely to be under pressure in the wake of soft Chinese trade data.
    Adding to the cautious tone in Europe, Standard & Poor's late on Tuesday cut
Italy's sovereign credit rating and left it on negative watch for possible
further downgrades, citing concerns about the economy. 
    At 0615 GMT, futures for Euro STOXX 50, for Britain's FTSE 100
, Germany's DAX and France's CAC were down 0.2 to 0.3
percent.
    "There's more bad news out of China and Italy's downgrade - which was not
entirely unexpected - so markets are probably going to open a little bit lower,"
said Neil Marsh, strategist at Newedge.
    "I am still underlying bullish but there is lots of hesitation."    
    China warned of a "grim" outlook for trade after reporting unexpected falls
in both exports and imports in June, signalling easing weakening demand both
within its borders and in the broader global economy.  
    Markets are also likely to be jittery ahead of the minutes from the latest
Federal Reserve meeting, due after the European market close, as investors seek
clues on when the U.S. central bank will start to scale back its equity-friendly
stimulus policies.
    Spanish shares, however, could get a boost after Wilbur Ross, the U.S.
billionaire who has made 65 percent profit on his 2011 investment in a
struggling Bank of Ireland (BOI) told Reuters he is likely to bid for
banks or financial assets in Spain over the next few months.  
    The FTSEurofirst 300 provisionally closed up 9.27 points, or 0.8
percent, at 1,188.95, extending a rebound that has seen the index rally more
than 6.5 percent from June lows.  
--------------------------------------------------------------------------------
  MARKET SNAPSHOT AT 0615 GMT: 
                                         LAST     PCT CHG    NET CHG
 S&P 500                              1652.32        0.72      11.86
 NIKKEI                              14416.60       -0.39     -56.30
 MSCI ASIA EX-JP                       500.36        0.57       2.82
 EUR/USD                               1.2787        0.04     0.0005
 USD/JPY                               100.61       -0.53      -0.52
 10-YR BUND YLD                        98.815        0.15      0.145
 SPOT GOLD                            1247.31          --      -1.53
 US CRUDE                              104.36        0.80       0.83
      
  > Asian shares pare gains after weak China trade data 
  > Wall St rises for fourth day on earnings hope, FedEx jumps 
  > Nikkei falls as dismal China data raise growth concerns  
  > U.S. bond prices end little changed 
  > Dollar bulls in form, Aussie slips on weak China trade data 
  > Gold falls after two-day rise on China growth fears 
  > Copper slips as grim China trade data stoke demand worries 
  > Brent slips towards $107 on concerns of weakness in China economy 
  > TOP NEWS on European companies 
    
    BURBERRY 
    The British luxury brand maintained its full-year guidance as it posted an
18 percent rise in first quarter underlying retail revenue, driven by robust
demand for spring/summer fashion. 
    
    ROCHE 
    Roche said it would stop developing aleglitazar, a diabetes treatment, due
to undesired side effects and lack of effectiveness. 
    
    SODEXO 
    The French catering-to-vouchers group said it expects full-year revenue
growth to range between 1-2 percent as previously forecast after solid demand in
Latin America and Europe slightly lifted third-quarter sales. 
   
    NOVARTIS 
    Novartis psoriasis drug secukinumab was superior to Amgen's Enbrel in a
late-stage study, the Swiss company said on Monday, putting it in line to become
the first of a clutch of new treatments to gain market approval. 
    
    GLENCORE XSTRATA 
    The company is looking to sell its Dakota Growers Pasta Co business in a
deal which could value the pasta maker at $300-400 million, three sources with
knowledge of the process told Reuters. 
    
    DEUTSCHE ANNINGTON 
    The German real estate company has set the price for its market debut at
16.50 euros ($21.10) per share, at the low end of its subscription price range,
giving it a market capitalisation of 3.7 billion euros. 
    
    TELECOM ITALIA 
    Telecom Italia's plan to spin off its domestic phone lines has won plaudits
from the telecommunications regulator, who said the move was bold and innovative
and could earn the former monopoly regulatory benefits. 
    
    FIAT 
    Fiat will put new investments on hold until it gets a clearer idea of the
impact of a court ruling that a portion of Italy's labour rules are
unconstitutional. 
    
    FIAT INDUSTRIAL 
    Italian truck and tractor maker Fiat Industrial's shareholders approved a
merger with its U.S. division CNH on Tuesday in what may be a template for a
later link-up between sister company Fiat and Chrysler.
    
    FRENCH BANKS  
    The French government will transfer 25 billion euros ($31.96 billion) of
state-guaranteed savings deposits to banks, in a potential boost to their
capital ratios, Les Echos reports, citing a government decree. 
    
    EDF, GDF SUEZ, ORANGE   
    The partially state-owned utilities could be among candidates for the French
government to sell stakes to fund a 12 billion euro public investment drive in
the coming years. Prime Minister Jean-Marc Ayrault on Tuesday opened the door to
such sales but he did not say which companies could be involved. 

    FAURECIA 
    The French auto parts maker will announce on Wednesday that it plans to sell
one of its French factories and cut jobs at another as it grapples with the
slump in demand hitting European automakers, Les Echos reports.