Europe Factors to Watch-Shares set to track Wall St rally

Mon Aug 11, 2014 2:33am EDT

PARIS, Aug 11 (Reuters) - European stocks were set to rise on Monday,
bouncing back from a sharp two-week slide and tracking a rally on Wall Street as
tensions slightly eased in Ukraine.
    The euro zone banking sector - recently hit by trouble at Portugal's Banco
Espirito Santo - will be in the spotlight on Monday after Banco
Popolare posted a net profit that beat expectations but said charges
for losses on bad debts had risen. 
    At 0620 GMT, futures for the Euro STOXX 50, the UK's FTSE 100
, Germany's DAX and France's CAC were up 0.6-1.2 percent.
    Late on Friday, Russia's Defence Ministry said it had ended military
exercises in southern Russia which the United States had criticised as a
"provocative" step amid the Ukraine crisis, sparking a sharp rally on Wall
Street. 
    The S&P 500 and the Dow Jones industrial average posted their
best day since March on Friday, both rising 1.1 percent, while Tokyo's Nikkei
 soared 2.4 percent on Monday.
    "The heat from the Ukraine-Russia flash point seems to be dying down,"
Capital Spreads trader Jonathan Sudaria wrote in a note.
    "Reports that Russia has used the old chestnut of ending 'military
manoeuvres' to tone down the tension seems to have worked again, and markets are
breathing a sigh of relief."
    Monday's gains could be limited, however, by concerns over tensions
persisting in other global hotspots such as Iraq, marked by U.S. air strikes
over the weekend. 
    The FTSEurofirst 300 index of top European shares has lost 4.9
percent over the past two weeks, as violence in Ukraine and fresh sanctions
against Russia have prompted investors to take profits.
        
    Europe bourses in 2014: (link.reuters.com/pad95v)
    Asset performance in 2014: (link.reuters.com/rav46v)
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  MARKET SNAPSHOT AT 0622 GMT: 
                                             LAST    PCT CHG  NET CHG
 S&P 500                                 1,931.59     1.15 %    22.02
 NIKKEI                                  15130.52     2.38 %   352.15
 MSCI ASIA EX-JP                           500.42     0.94 %     4.67
 EUR/USD                                   1.3397     -0.1 %  -0.0013
 USD/JPY                                   102.10     0.06 %   0.0600
 10-YR US TSY YLD                           2.431         --     0.02
 10-YR BUND YLD                             1.070         --     0.02
 SPOT GOLD                              $1,306.10    -0.25 %   -$3.24
 US CRUDE                                  $97.76     0.11 %     0.11
  > GLOBAL MARKETS-ASIA STOCKS RISE, DOLLAR STEADY AFTER REBOUND 
  > US STOCKS-WALL ST REBOUNDS, ERASES WEEK'S LOSSES WITH RUSSIA NEWS 
  > NIKKEI BOUNCES SHARPLY ON YEN'S RETREAT, EASING TENSIONS IN UKRAINE 
  > FOREX-YEN OFF HIGHS AS GEOPOLITICAL TENSIONS EASE, SENTIMENT FRAGILE 
  > GOLD DIPS ON FIRMER EQUITIES; MIDDLE EAST, UKRAINE TENSIONS EYED 
  > METALS-COPPER UP ABOVE $7,000 AS GEOPOLITICAL TENSIONS COOL 
  > BRENT HOLDS ABOVE $105, IRAQ OIL OUTPUT STEADY DESPITE CONFLICT 
    
    COMPANY NEWS:
    
    BANCO POPOLARE 
    Italy's fourth-biggest bank beat expectations by posting a net profit of
24.9 million euros in the second quarter but said charges for losses on bad
debts had risen in the period from a year earlier. 
    
    SANOFI 
    The French drugmaker and MannKind Corp have agreed a worldwide
licensing deal to develop and market inhaled insulin therapy Afrezza for adults
with diabetes. 
    
    BALFOUR BEATTY, CARILLION 
    British infrastructure company Balfour Beatty said it has rejected a second
proposal from rival Carillion to merge, citing the significant risks the deal
would pose to its business. 
    
    TELECOM ITALIA, VIVENDI 
    As part of a potential deal between Telecom Italia and Vivendi over the
French group's broadband unit GVT, Tim Brasil could launch a capital increase
that would see Telecom Italia diluting its 67 percent stake in the Brazilian
group to a 50 percent share in the new company that would be born from the
combination of Tim Brasil and GVT, Il Sole 24 Ore said in an unsourced report.
 
    
    THYSSENKRUPP 
    Cevian is planning to ask shareholders at ThyssenKrupp's next annual meeting
to appoint a representative of the activist investor to the board of the German
steelmaker, WirtschaftsWoche reported citing sources close to the board.
 
    
    QSC 
    The German internet service company toned down its 2014 sales and operating
profit outlook and announced plans for a savings programme as it reported a
bigger-than-expected decline in quarterly earnings. 
    
    BILFINGER 
    Germany's Bilfinger reported a 30 percent fall in adjusted core
profit in the second quarter, dragged down by its power business. 
    
    ADECCO 
    Adecco said it acquired OnForce Inc., which produces cloud-based solutions
for companies to manage their use of freelancers and independent contractors, to
complement the vendor management system provided by the Swiss firm's Beeline
business. The deal will have no material impact on Adecco, it said. 
    

 (Reporting by Blaise Robinson; Editing by James Regan)
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