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Europe Factors to Watch-Shares set to open flat to slightly lower
April 8, 2014 / 5:40 AM / 4 years ago

Europe Factors to Watch-Shares set to open flat to slightly lower

PARIS, April 8 (Reuters) - European stocks were seen opening flat to
slightly lower on Tuesday, adding to the previous session's sell-off and
following further losses on Wall Street, where investors continued to dump
Internet stocks and switch into defensive sectors.
    At 0627 GMT, futures for Euro STOXX 50, for UK's FTSE 100,
for Germany's DAX and for France's CAC were flat to down 0.1
    The Dow Jones industrial average fell 1 percent on Monday and the S&P
500 lost 1.1 percent. The Nasdaq, home of tech and biotech companies,
lost 1.2 percent, posting its worst three-day decline since November 2011. 
    Michael Hewson, chief market analyst at CMC Markets, said investors finally
started to focus on valuations of the so-called 'momentum stocks" ahead of the
first-quarter earnings season.
    "The risk is now that with margin debt on the S&P500 at record levels, the
rush for the exits could feed in on itself and prompt an even bigger sell-off
particularly if we get a move through the 1,830 level and March lows," he wrote
in a note.
    "We're some way from that at the moment but unless earnings growth starts to
reflect economic fundamentals and a retreating Fed then the potential for
trouble will grow."
    Data from the New York Stock Exchange shows margin debt - equities bought
with borrowed money - on the NYSE market totalled around $465 billion at the end
of February, its highest level ever, fuelling worries of an acceleration on the
downside if the leveraged positions are hurriedly closed. 
    Simmering tensions in Ukraine also weighed on sentiment, after pro-Moscow
protesters in eastern Ukraine seized arms in one city and declared a separatist
republic in another, moves Kiev described as part of a Russian-orchestrated plan
to justify an invasion. 
    Europe bourses in 2014:
    Asset performance in 2014:
                                         LAST  PCT CHG  NET CHG
 S&P 500                             1,845.04  -1.08 %   -20.05
 NIKKEI                             14,606.88  -1.36 %  -201.97
 MSCI ASIA EX-JP                        476.9   0.42 %     2.01
 EUR/USD                               1.3744   0.03 %   0.0004
 USD/JPY                               102.88   -0.2 %  -0.2100
 10-YR US TSY YLD                       2.706       --     0.01
 10-YR BUND YLD                         1.557       --     0.02
 SPOT GOLD                          $1,308.50   0.96 %   $12.46
 US CRUDE                             $101.03   0.59 %     0.59
  > GLOBAL MARKETS-Asian shares shrug off losses, yen holds gains 
  > Wall St ends lower; S&P 500 in biggest 3-day drop since Jan 
  > Nikkei drops on U.S. tech blues, waning BOJ easing hopes 
  > FOREX-Yen stays firm after BOJ stands pat; euro holds steady 
  > PRECIOUS-Gold holds near $1,300 on weaker equities, Ukraine tensions 
  > METALS-London copper steady as China returns; price range narrows 
  > Brent climbs above $106 on Ukraine tension; Libya supply caps gains 
    The Moulin family that controls French department store Galeries Lafayette
said on Monday it had bought a 6.1 pct stake in Carrefour, making it the
second-biggest shareholder in the French supermarket chain. 
    Deutsche Bank may need to set aside billions of euros in additional capital
under a proposal from European regulators that could affect the bank's efforts
to strengthen its balance sheet and put pressure on dividends, analysts said.
    French insurer Groupama said on Monday it had launched the sale of its
entire 1.8 percent stake in Saint-Gobain, Europe's biggest supplier of
construction materials. 
    The government of Matteo Renzi is looking to wipe the slate clean and seek
new names at Italy's main state-controlled groups including oil major Eni as top
management comes up for renewal, government, political and industry sources
    Barclays has reached a settlement with a UK care home operator weeks before
the start of a court case that was seen as a test case for whether customers
might sue banks over the manipulation of Libor interest rates. 
    Goldman Sachs has priced its accelerated bookbuild of shares in Sports
Direct International at 850 pence each, a source familiar with the matter said
on Monday, valuing the placement at 212.5 million pounds ($352.75 million).
Roughly half of the $1.5 billion profit last year in the world's biggest
container shipping company, Maersk Line, a unit of Danish shipping and oil group
A.P. Moller-Maersk, came from green initiatives that reduced fuel consumption
and carbon dioxide emissions, daily Lloyd's List wrote.
    The travel firm starts trade after an initial public offering priced at
10.25 euros per share.

 (Reporting by Blaise Robinson; Editing by Natalie Huet and Sudip Kar-Gupta)

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