EUROPEAN EQUITIES UPDATE: Indices mostly higher, constructive Trump-China comments boost Miners/Autos, BRBY LN +15% post-results

EQUITIES

STOXX 600: +0.3%

• European bourses began the session almost entirely in the green and continued to gradually extend higher as the morning progressed. A slew of PMI metrics from within the EZ had little impact on the complex.


• Today’s trade has been headlined by PMI metrics; French figures saw slight beats on Composite/Manufacturing whilst the Services dipped further into contractionary territory. Germany reported strong results across the board, with the Composite figure surprisingly climbing into expansionary territory; the release noted that “Manufacturing output is shrinking at the slowest rate since mid-2024, and the new order situation has eased a bit too.”


• For the EZ-wide figure, Composite also unexpectedly climbed out of contractionary territory, whilst Services was a little lower. The accompanying release noted that “Given the weak state of the economy, the ECB will likely stick to its gradual pace of cutting interest rates, for the time being.”

Sectors: Positive

• European sectors hold a slight positive bias, with the gainers for the day generally attributed to comments via US President Trump overnight; he noted that talks with Chinese President Xi went fine and added that he would rather not have to use tariffs over China in a pre-taped interview with Fox News.


• As such, metals prices soared, which has helped to lift Basic Resources, and Autos also gain as traders wind down their expectations of tariffs; Luxury names are also benefiting in today’s session following these comments. Further upside stems from positive results from Burberry, which saw its shares soar around 15% at the open.


• Telecoms is the underperformer today, stemming from particular post-earning weakness in Ericsson (-7.9%); the co. reported weak Q4 results and highlighted particular weakness in India.

Majors: FTSE 100 -0.2%, FTSE MIB +1%, DAX 40 +0.4%

• The FTSE 100 is a little lower vs opening flat, with pressure in the index accelerating after the region's PMI metrics (details below). Mining names generally populate the top end of the index; Antofagasta (+4.5%) and Glencore (+3%) both gain, with sentiment in metals prices lifted after the aforementioned constructive comments from Trump on China. Outside of the FTSE 100, luxury name Burberry (+15%) soars after its LFL sales figure declined less than expected. On the data front, UK Flash PMIs printed above expectations across the board, which sparked some very modest pressure in the FTSE 100.


• The FTSE MIB is the best performer in Europe today, for a couple of reasons. Firstly, Moncler (+5.2%) narrowly tops the pile, with sentiment in the entire sector lifted following positive Burberry earnings. Mediobanca (+5%) follows closely behind, amid M&A talks; BMPS (-6.7%) has launched a USD 13.9bln takeover bid for Mediobanca – though no agreement has been made thus far. Bloomberg reported that Mediobanca believed the takeover bid to be hostile.

US Equity Futures: ES U/C, NQ -0.1%, RTY -0.1%

• Futures are essentially flat/incrementally lower, in a slight paring to some of the upside seen in the prior session.


• The docket ahead is fairly quiet, aside from US Flash PMI metrics; expectations is for the Manufacturing and Services figure to edge a little lower from the prior.

24 Jan 2025 - 10:00- EquitiesData- Source: Newsquawk