EUROPEAN EQUITIES UPDATE: Europe firmer but US futures subdued ahead of Liberation Day

STOXX 600: +0.9%

• European bourses are entirely in the green, as the region recovers from the prior day’s hefty losses. However, price action since the cash open has been fairly contained today as traders brace themselves for US President Trump’s April 2nd tariffs.


• Recent reporting has suggested that Trump is said to still be deciding which plan he will take for reciprocal tariffs and has been presented with "multiple" tariff plans; Treasury Secretary Bessent said the President will announce reciprocal tariffs at 15:00EDT/20:00BST on Wednesday.


• Today’s EZ docket has included a slew of Manufacturing PMI Finals, with Spain, and Italy missing forecasts, whilst France and the EZ-wide figure were revised modestly lower (Germany was unrevised); the EZ's accompanying report suggested that “things are looking up… A significant part of this movement may have to do with the frontloading of orders from the U.S. ahead of the tariffs, which means some backlash is to be expected in the coming months”.


• On the inflation front; headline EZ HICP printed in-line with expectations, whilst the core/supercore figures were a touch lower; the Services figure cooled to 3.4% from 3.7%; overall the metrics had little impact on the equities complex.

Sectors: Positive

• European sectors hold a strong positive bias, but with no clear outperformer and with gains fairly broad-based given the risk tone.


• Healthcare leads the pack today, lifted by strength in AstraZeneca after it reported positive trial results for its cholesterol drug, which has boosted hopes of another blockbuster drug. Tech and Basic Resources complete the top three, benefiting from the overall risk tone.


• Consumer Products is a little higher today, with clothing brands benefiting in tandem with post-earning strength in PVH (+15.8% pre-market) which beat Q4 analyst expectations - the likes of Hugo Boss opened higher, but has given back some of that earlier upside.


• Optimised Personal Care and Utilities sit at the foot of the pile, but with no clear drivers.

Majors: FTSE 100 +0.8%, DAX 40 +1.2%, CAC 40 +0.8%

• The FTSE 100 is on a firmer footing today, with gains to a similar magnitude as peers; for the index specifically, Goldman Sachs raised its FTSE 100 forecast for next 12 months to 9,100 from 9,000. Elsewhere, from an economic perspective, UK shop prices fall less than the prior month; a BRC exec noted that "With retailers bracing for significant extra costs which kick in later this week as a result of the budget, inflation will likely accelerate in the coming months". UK Manufacturing PMI was revised a little higher, but had little impact on price action. Commentary from BoE's Greene has had little impact on UK assets; she noted that slack is opening up in the UK labour market. At a stock specific level, AstraZeneca (+1.4%) benefits after reporting positive trial results with its cholesterol drug; analysts at JPMorgan suggest the drug has “blockbuster potential”. Travis Perkins (-8.2%) saw its shares slump at the open after it reported poor results, highlighted uncertainty in 2025 and provided disappointing outlook.


• The DAX 40 is firmer and marginally outperforming peers; Adidas (+3.4%) tops the pile after being reiterated with a Buy rating at Stifel; Mercedes Benz (-0.3%) moves a little lower after the co. said Q1 sales are slightly lower than last year, mainly driven by China; nonetheless, it expects Q1 within the FY guidance range.

US Equity Futures: ES -0.2%, NQ U/C, RTY -0.2%

• Futures are modestly lower/mixed, unable to benefit from the positive risk tone in European trade and as indices give back some of the prior day’s upside.


• The highlight of the US Day is the ISM Manufacturing data for March, where the headline is expected to slip below 50.0, into contraction (see below for primer); before the data is released, S&P Global will release its final manufacturing PMI data for the month. JOLTS job openings are seen easing to 7.616mln in February from 7.74mln in January (for reference, the Vacancy Rate rose to 4.6% in February from 4.5%, while the Quits Rate rose to 2.1% from 1.9%).

01 Apr 2025 - 10:20- EquitiesData- Source: Newsquawk