Europe Factors to Watch-Shares set to rise, helped by earnings

Wed Aug 13, 2014 2:26am EDT

PARIS, Aug 13 (Reuters) - European stocks were set to open higher on
Wednesday, helped by forecast-beating results from bellwethers such as Swiss
Life and Merck, although gains could be capped by weak macro
figures from Asia and worries over the Ukrainian crisis.
    Data showed on Wednesday the amount of money flowing into China's economy
slowed to the lowest level in nearly six years in July, adding to concerns a
sustained recovery may be at risk in the second half of the year.
 
    In Japan, data showed the country suffered its biggest economic contraction
since the devastating March 2011 earthquake in the April-June quarter, as a
sales tax hike took a heavy toll on household spending. 
    At 0620 GMT, futures for Euro STOXX 50, for UK's FTSE 100,
for Germany's DAX and for France's CAC were up 0.3-0.5 percent.
    Swiss Life will be in focus after Switzerland's largest dedicated
life insurer beat expectations with a slight rise in first-half net income,
buoyed by a strong performance in its home market. 
    Germany's Merck KGaA, the world's largest maker of liquid crystals
for display screens, said quarterly underlying core earnings edged up 2.3
percent thanks to a recent takeover, though the gain was tempered by the strong
euro. 
    However, the impact from the violence in Ukraine and Western sanctions
against Russia were visible again on the earnings front on Wednesday, with
Germany's biggest utility, E.ON, saying core earnings fell 12 percent
in the first half of 2014, dragged lower by loss-making power plants as well as
a declining economy and currency in Russia, its key foreign market.
 
    Fighting in Ukraine and sanctions against Russia, a major energy supplier to
Europe, have muddied the forecasts of a number of multinationals including
Henkel, Adidas and Rheinmetall. 
    As Europe's earnings season draws to a close, STOXX Europe 600 
companies have posted a 10 percent rise in second-quarter profits on average,
but revenues have slipped 1.1 percent, reflecting Europe's frustratingly slow
economic recovery. 
        
    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                             1,933.75   -0.16 %    -3.17
 NIKKEI                              15213.63    0.35 %    52.32
 MSCI ASIA EX-JP                       504.59    0.23 %     1.14
 EUR/USD                               1.3372    0.02 %   0.0003
 USD/JPY                               102.25       0 %   0.0000
 10-YR US TSY YLD                       2.456        --     0.01
 10-YR BUND YLD                         1.074        --     0.01
 SPOT GOLD                          $1,310.60    0.17 %    $2.26
 US CRUDE                              $97.15   -0.23 %    -0.22
  > GLOBAL MARKETS-SHARES SLUGGISH, UKRAINE WOES FANS GROWTH FEARS 
  > US STOCKS-WALL ST SLIPS AFTER TWO-DAY RALLY; ENERGY SHARES DROP 
  > NIKKEI CHOPPY ON GLOOMY JAPAN GDP, GEOPOLITICAL TENSIONS 
  > FOREX-YEN TAKES JAPAN GDP SHRINKAGE IN STRIDE; EURO OFF LOWS 
  > GOLD HOLDS ABOVE $1,300 AS UKRAINE WORRIES STOKE SAFE-HAVEN DEMAND 
  > COPPER SINKS TO LOWEST SINCE JUNE ON GLOBAL GROWTH WORRIES 
  > BRENT NEAR 13-MONTH TROUGH BELOW $103 ON BRISK SUPPLIES 
    
    COMPANY NEWS:
    
    SWISS LIFE 
    Switzerland's largest dedicated life insurer beat expectations with a slight
rise in first-half net income, buoyed by a strong performance in its home
market, and said it is buying a real estate service provider in Germany.
 
    
    E.ON 
    Germany's biggest utility said its core earnings fell 12 percent in the
first half of 2014, dragged lower by loss-making power plants as well as a
declining economy and currency in Russia, its key foreign market. 
    
    MERCK 
    Germany's Merck, the world's largest maker of liquid crystals for display
screens, said quarterly underlying core earnings edged up 2.3 percent thanks to
a recent takeover, though the gain was tempered by the strong euro. 
    
    GLENCORE 
    Miner and commodity trader Glencore said it produced 13 percent more copper
in the first half this year, in line with market forecasts, boosted by output
growth at its African and South American mines. 
    
    SCHNEIDER ELECTRIC 
    The company said it agreed to buy Gunsan Elektrik, which it said was the
second-largest player in wiring device accessories serving residential and
commercial buildings markets in Turkey. Gunsan has more than 300 staff and had
2013 revenue of about 35 million euros, Schneider said. 
    
    MICHAEL PAGE 
    The British staff recruitment firm posted a 11 percent rise in first half
pretax profits on Wednesday, after all four of its regions delivered
year-on-year growth. 
    
    G4S 
    The world's biggest security group posted a better-than-expected rise in
first-half operating profit, led by strong demand in emerging markets. 
    
    STOCKMANN 
    The Finnish department store chain on Wednesday posted a smaller
second-quarter operating profit than expected of 3.5 million euros due to weak
consumer sentiment in Finland and the decline of the Russian rouble. It stood by
an outlook for a significantly weaker operating profit this year than last.
 
    
    TELEKOM AUSTRIA 
    America Movil's Telekom Austria trimmed its full-year outlook on
Wednesday and reported bigger-than-expected declines in second-quarter sales and
profit. 
    
    MERCK 
    Germany's Merck, the world's largest maker of liquid crystals for display
screens, said quarterly underlying core earnings edged up 2.3 percent thanks to
a recent takeover, though the gain was tempered by the strong euro. 
    
    E.ON 
    Germany's biggest utility said its core earnings fell 12 percent in the
first half of 2014, dragged lower by loss-making power plants as well as a
declining economy and currency in Russia, its key foreign market. 
    
    SALZGITTER 
    Germany's Salzgitter reported an unexpected second-quarter pretax profit on
Wednesday as cost cuts at the group helped offset the effects of overcapacity on
Europe's steel market. 

 (Reporting by Blaise Robinson, editing by Tricia Wright)