European Factors to Watch - Shares to fall on Ukraine tension

Wed Aug 6, 2014 2:23am EDT

(Adds quote, company news)
    EDINBURGH, Aug 6 (Reuters) - European shares are set to open lower on
Wednesday, after a deterioration in the situation in Ukraine prompted a sell-off
in equities globally.
    Asian and U.S. shares extended falls after reports that Russian troops were
massing at the eastern Ukrainian border, where pro-Moscow rebels are in conflict
with the Ukrainian government - ratcheting up geopolitical tension in the
region. 
    Russian President Vladimir Putin also ordered his government to prepare
retaliatory measures against the latest round of Western sanctions, Russian news
agencies reported on Tuesday. 
    "Looking ahead to European trade, we are calling the major European bourses
lower as they also play catch up to losses seen around the globe," Stan Shamu,
market strategist at IG, said in a trading note.
    "President Putin reportedly ordered his government to investigate
retaliatory sanctions against the EU and U.S. There is also renewed build-up of
Russian troops at the Ukraine border resulting in fears of Russia invading
Ukraine."
    At 0617 GMT, futures for the Euro STOXX 50, Germany's DAX 
and France's CAC were 0.6-1 percent lower, while futures for Britain's
FTSE 100 were 0.3 percent lower.
    Earnings reports were set to contribute to weakness, with Swiss Re
, the world's second-largest reinsurer, saying its net profit rose
less than expected in the second quarter, as the firm's chief executive warned
he saw prices weakening further in the insurance industry. 
    With two-thirds of STOXX Europe 600 companies having reported
results, 44 percent have missed expectations, compared to just 26 percent of
companies on the U.S. S&P 500 that have fallen short of estimates,
according to Thomson Reuters StarMine data.
    However, some companies managed positive surprises on Wednesday, with the
banking arm of Dutch financial giant ING beating earnings forecasts in
the second quarter of the year, returning underlying pretax profits of 1.278
billion euros against the 1.137 billion euros expected by analysts.
 
    
    Europe bourses in 2014: (link.reuters.com/pad95v)
    Asset performance in 2014: (link.reuters.com/rav46v)   
    
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  MARKET SNAPSHOT AT 0620 GMT: 
                                          LAST   PCT CHG  NET CHG
 S&P 500                              1,920.21   -0.97 %   -18.78
 NIKKEI                               15159.79   -1.05 %  -160.52
 MSCI ASIA EX-JP                        502.66   -0.35 %    -1.75
 EUR/USD                                1.3361    -0.1 %  -0.0014
 USD/JPY                                102.57   -0.02 %  -0.0200
 10-YR US TSY YLD                        2.484        --     0.00
 10-YR BUND YLD                          1.154        --    -0.02
 SPOT GOLD                           $1,291.39    0.28 %    $3.65
 US CRUDE                               $97.48     0.1 %     0.10
 
  > GLOBAL MARKETS-Asia shares worn out by Wall St            
  > US STOCKS-Stocks tumble on Ukraine tensions; Time Warner skids        
  > Nikkei falls to 2-1/2-wk low, SoftBank tumbles on M&A disappointment    
  > TREASURIES-Prices jump as Wall St slumps, investor fears multiply    
  > FOREX-Dollar clings near 11-month high after upbeat data, kiwi falls    
 
  > PRECIOUS-Gold rises on safe-haven bids; Ukraine tensions hurt stocks   
 
  > METALS-London copper hits two-week low on shaky China outlook        
  > Brent rebounds to $105; U.S. oil stocks eyed                   
    
    COMPANY NEWS:    
    DEUTSCHE BANK 
    The private-equity arms of Goldman Sachs Group Inc and Deutsche Bank
were close to sealing a deal to purchase the buyout unit of National Bank of
Greece SA (NBG), Bloomberg reported on Wednesday, citing sources.
 
    Related news 
    
    E.ON 
    Bidders are readying indicative offers for the Spanish assets of Germany's
top utility, three sources familiar with the matter told Reuters, adding bids
would value the whole portfolio at about 2 billion euros ($2.7 billion).
 
    Related news 
    
    DEUTSCHE TELEKOM 
    Sprint Corp has dropped its bid to acquire T-Mobile U.S. Inc 
after regulatory resistance showed no signs of softening despite months of
lobbying, people familiar with the matter told Reuters.
    Meanwhile, three sources familiar with the matter said that French telecom
firm Iliad is in talks with investors to improve its bid for T-Mobile
US because it expects parent company Deutsche Telekom will reject its $15
billion offer. 
    Related news 
        
    SWISS RE 
    Swiss Re, the world's second largest reinsurer, posted a
lower-than-expected rise in second-quarter net profit to $802 million for the
second quarter, and said it saw prices in the insurance industry weakening
further.
    For more, click on 
    
    ROCHE 
    Roche said on Wednesday that European regulators approved its drug
Avastin as a treatment for women with ovarian cancer that is resistant to
platinum-containing chemotherapy.
    For more, click on 
    
    ING 
    The banking arm of Dutch financial giant ING beat earnings forecasts in the
second quarter of the year, returning underlying pretax profits of 1.278 billion
euros against the 1.137 billion euros expected by analysts. 
    
    UCB 
    The Belgian pharmaceutical company is exploring a sale of its Kremers Urban
Pharmaceuticals Inc division, a U.S. specialty generics business that could
fetch as much as $2 billion, according to people familiar with the
matter. 
    
    ILIAD 
    The French telecom firm is in talks with investors to improve its bid for
T-Mobile US because it expects the parent company Deutsche Telekom to
reject its $15 billion offer, three sources familiar with the matter said on
Tuesday. 
     Meanwhile, Sprint Corp has dropped its bid to acquire T-Mobile U.S.
Inc after regulatory resistance showed no signs of softening despite
months of lobbying, people familiar with the matter told Reuters.
 
    
    TELEFONICA 
    Telefonica's plan to buy control of Brazilian telecommunications company GVT
SA would pose no hurdle to competition in the industry, Communications Minister
Paulo Bernardo said on Tuesday. 
    
    IAG  
    British Airways has suspended flights to and from Liberia and Sierra Leone
until the end of the month due to public health concerns, the airline owned by
International Airlines Group said on Tuesday. 
    
    PIRELLI 
    Italy's Pirelli, the world's fifth-largest tyremaker, confirmed its
full-year targets on Tuesday after reporting a larger-than-expected increase in
first-half operating profit, boosted by strong growth in its premium tyre
division. 
    The presence of oil giant Rosneft in the share capital of tyremaker Pirelli
does not violate U.S. sanctions against Russia, Pirelli chief Marco Tronchetti
Provera said on Tuesday. 
    
    UNICREDIT 
    Italy's biggest bank UniCredit sees no need to review its business plan due
to slower-than-expected growth figures for Italy, the lender's CEO said on
Tuesday. 
    Net profit at UniCredit, Italy's biggest bank by assets, rose 12 percent in
the second quarter thanks to a marked improvement in its home market and a solid
contribution from eastern Europe. 
    
    GLENCORE 
    Glencore Plc, one of the world's largest mining companies, has asked a U.S.
judge to dismiss it as a defendant from nationwide antitrust litigation over the
alleged manipulation of aluminum prices.    
    
    STANDARD CHARTERED 
    Standard Chartered PLC is back in the crosshairs of New York's banking
regulator over alleged failure to flag high risk transactions for further
review, according to a person familiar with the matter. 

 (Reporting by Alistair Smout; Editing by Sudip Kar-Gupta)
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