Europe Factors to Watch-Shares seen steady; Russia in focus

Fri Mar 21, 2014 3:37am EDT

PARIS, March 21 (Reuters) - European stocks were seen steady on Friday,
although shares of companies with a big exposure to Russia could be under
renewed pressure after Washington extended sanctions and Fitch revised the
country's outlook to 'negative'.
    At 0730 GMT, futures for Euro STOXX 50, for UK's FTSE 100,
for Germany's DAX and for France's CAC were up 0.2 to down 0.05
percent.
    Washington raised the stakes in an East-West confrontation over Crimea on
Thursday by the extension of visa bans and asset freezes into Russian President
Vladimir Putin's inner circle of closest long-time political and business
allies. 
    Credit rating agency Fitch revised the outlook on Russia's long-term foreign
and local currency rating to "negative" from "stable" while keeping the rating
at 'BBB'. 
    Russia's MICEX stock index was down 3.1 percent in early trade on
Friday. 
    "There hasn't been any military escalation, so the impact of the crisis on
the overall European market is very small now, but on a more granular view, it's
best to avoid all the stocks exposed to Russia, so it's a market for stock
pickers," a Paris-based trader said.
    Shares of European companies most exposed to Russia will be under renewed
pressure, including Finnish tyre maker Nokian Renkaat, Austrian
lender Raiffeisen Bank International and Danish brewer Carlsberg
. The three firms derive 26 percent, 22 percent and 17 percent
respectively of their revenues from Russia, according to data from MSCI.
    For a list of European blue-chips with the biggest exposure to Russia, click
 
    The tensions in Ukraine, as well as mounting concerns over the pace of
growth in China, has been denting investor appetite for Europe's shares, with
Thomson Reuters Lipper data showing inflows of U.S. investments into European
stocks slowed to their lowest pace in eight months in the seven days to March
19.
    The Lipper poll of 103 U.S.-domiciled funds invested in European stocks
showed they raked in a net $214 million, the smallest inflow since July 2013,
although the funds still managed to extend their longest winning streak on
record into a 38th week.
    While those U.S. inflows into European stocks were relatively small, they
still contrast with further sharp outflows from emerging market stocks, which
saw $1.12 billion in redemptions during the week, according to Lipper.
    The European stock market has been the big winner of sharp investment
outflows from emerging markets. These emerging markets economies have been hurt
in part by the scaling back of the U.S Federal Reserve's quantitative easing
programme, while investors have also increasingly bet on a euro zone economic
recovery. 
    According to a Reuters poll of 37 fund managers and strategists, taken in
the past week, the pan-European STOXX Europe 600 index is seen adding
almost 8 percent before year-end. Germany's DAX will underperform,
however, hurt in part by its strong exposure to troubled emerging markets, which
have seen big swings in the value of their currencies. 
    Europe bourses in 2014: link.reuters.com/pad95v
    Asset performance in 2014: link.reuters.com/rav46v
------------------------------------------------------------------------------
  MARKET SNAPSHOT AT 0733 GMT:
                                         LAST  PCT CHG  NET CHG
 S&P 500                             1,872.01    0.6 %    11.24
 MSCI ASIA EX-JP                       452.49     0.77     3.45
 EUR/USD                               1.3774  -0.03 %  -0.0004
 USD/JPY                               102.31  -0.07 %  -0.0700
 10-YR US TSY YLD                       2.770       --    -0.01
 10-YR BUND YLD                         1.642       --    -0.01
 SPOT GOLD                          $1,330.15   0.17 %    $2.26
 US CRUDE                              $98.74  -0.16 %    -0.16
 
  > GLOBAL MARKETS-Stocks steady after Fed scare, eye yuan slide 
  > US STOCKS-Wall St rebounds after data; financials climb 
  > FOREX-Dollar pauses before Fed speakers; yuan hits 13-month low 
  > PRECIOUS-Gold heads for biggest weekly fall in four months 
  > METALS-Copper prices eye fourth weekly loss on China worries 
  > Brent falls towards $106; on track for fourth weekly loss 
    
    COMPANY NEWS:
    
    BP 
    BP has been sucked into the row over Russia's annexation of Crimea with
calls for the delisting from the London Stock Exchange of Rosneft, the
Moscow-based oil company in which the British group has a 20 percent holding,
according to the Guardian. 
    
    NESTLE, DANONE, FRESENIUS 
    Swiss food giant Nestle and diversified German healthcare group Fresenius
 are among the four groups that have shown interest in buying the
Medical Nutrition unit of France's Danone, daily Les Echos said on Thursday.
    
    SANPAOLO 
    In its new business plan to be presented next week the bank will be aiming
for a return on equity of 10 percent by 2018, Il Sole 24 Ore said, without
citing sources. 
    
    UNIPOL UNIPOLSAI 
    Unipol Banca, part of insurer Unipol, plans to carry out a capital increase
for 100 million euros ($138 million), Unipol Chief Executive Officer Carlo
Cimbri said on Thursday.
    
    TELECOM ITALIA 
    Telecom Italia may look into taking a minority stake in Italian fibre
network provider Metroweb to help boost its investments in faster networks,
people familiar with the matter said. 
    
    BOUYGUES NUMERICABLE VIVENDI 
Conglomerate Bouygues re-opened the battle to buy France's second biggest
telecoms provider SFR on Thursday with a new offer less than a week after owner
Vivendi began exclusive talks with rival bidder Numericable. 
    
    HAVAS 
    French advertising agency Havas saw its profits rise slightly last year,
helped by recovering markets in Europe and North America and a robust Asia, the
company reported on Thursday. 
    
    ADIDAS 
    Peer Nike Inc on Thursday warned Wall Street that growing pressures
from weaker currencies in key emerging markets would take a big toll on its
profit in the current quarter and into the next fiscal year. 
    
    DEUTSCHE BANK 
    Deutsche Bank has failed to win the dismissal of four U.S. lawsuits seeking
to force it to pay damages or buy back troubled home loans it had packaged into
residential mortgage-backed securities prior to the 2008 financial crisis.
 

 (Reporting by Blaise Robinson, editing by Tricia Wright and Alistair Smout)
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