EUROPEAN EQUITIES UPDATE: European bourses mixed and off best levels, HSBC -6% after proposing to privatise Hang Seng Bank

STOXX 600: -0.3%

• European bourses have opened mixed this morning. The biggest loser today is the FTSE 100 (-0.4%) - driven by losses in HSBC (-6.1%) after it proposed to privatise Hang Seng Bank. Further adding to the pressure is Lloyds (-2.6%), after the Co. warned of a "material" hit related to the FCA's latest motor finance ruling.


• On the Geopolitical front, progress in the Middle East between Israel and Hamas after President Trump said that both parties have agreed to the first phase of his peace plan, signalling imminent release of all hostages and an Israeli troop withdrawal to a mutually agreed line. This has caused a slight downturn in some European companies like BAE Systems (-0.8%), Leonardo (-0.9%) and Rheinmetall (-0.6%).


• Looking ahead ECB Minutes (Sep), Eurogroup Meeting, Speakers including BoE’s Mann, ECB’s Lane, BoC’s Rogers

Sectors: Negative

• Sectors hold a negative bias. Basic Resources leads and is largely driven by broker upgrades for companies within the sector. Construction & Materials (0.56%) is the second biggest winner today however, there is no clear macro driver for the recent uptick in gains. Whilst Energy (+0.57%) is third given a boost by BP (0.6%) after announcing the start of oil production at its Murlach project in the UK North Sea, marking its sixth energy startup this year.


• The biggest loser is the banking sector (-1.26%) due to losses in shares by major banking companies in the index like HSBC (-6.1%) and Lloyds (-2.6%).


• Automobiles and parts are another big loser. Added focus on the sector with German Chancellor Merz set to hold an auto crisis meeting at 14:00 BST; most recently, German coalition agrees to EUR 3bln in EV incentives through 2029. Elsewhere, Michelin (ML FP) moves lower after analysts suggested a recent company call highlighted a weak Q3 and possible FY downgrades.

Movers:

• Shell (+0.9%) - Co. nears US license to export Venezuelan gas to Trinidad, Bloomberg reports increasing their shares and driving up the Energy sector.


• Orsted (+0.8%) - Announced completion of rights issue of new shares of nominally DKK 10 each. 901mln new shares to be listed on Nasdaq Copenhagen.


• UBS (-1.65%) – Shares have slumped after CEO Ermotti says he sees more bank deals in Italy


• Equinor (EQNR NO) downgraded to Sell from Buy at DZ Bank, weighing the financial services sector

US Equity Futures: ES -0.1%, NQ -0.1%, RTY -0.1%

• US futures are soft ES and NQ are down 0.1%. No clear driver but lack of progress in gov’t shutdown may have reduced sentiment in US equities and the recent hawkish sentiment from the Fed's minutes may leave traders apprehensive.


• Looking ahead: Fed Chair Powell, Bowman, Barr & Kashkari, Supply from US, Earnings from Delta Air & PepsiCo.

09 Oct 2025 - 10:00- ForexEU Research- Source: Newsquawk