EUROPEAN EQUITIES UPDATE: Positive sentiment as traders cheer Trump's softer tone on China

STOXX 600: +0.5%

• European bourses have opened firmer this morning with upside seen in the AEX (+1%), Euro Stoxx 50 (+0.7%), CAC 40 (+0.6%), DAX 40 (+0.7%) and FTSE 100 (+0.2%). Sentiment has increased for European equities following Trump’s softening tone on his initial 100% tariff proposal on China on Friday, saying that “the USA wants to help China”.


• In France, the reinstated French Prime Minister Lecornu’s new government takes office on Monday amid mounting pressure to urgently produce a budget and ease the ongoing political instability plaguing France.


• Elsewhere, newsflow has been light thus far today. However, there was data via Germane, where German Wholesale Prices (M/M and Y/Y) rose from the prior. Looking ahead, speakers include BoE Mann and ECB’s Buch (Supervisory).

Sectors: Positive

• European Sectors are starting the week with strong gains with the only downside being the Telecommunication (-0.3%) sector. There’s been no clear driver for the recent downtick in the sector.


• The biggest winners today are Basic Resources (+1.5%), Technology (+1.4%) and Consumer Products and Services (+1.2%). Upside in ASML (+3%) following broker PT upgrade, and amidst the positive risk tone.


• Basic Resources benefits from strength in underlying copper prices after constructive Chinese trade data, where both Imports and Exports topped expectations - a factor which has also helped to boost Consumer Products and Services. Moreover, the positive US-China trade developments will also be helping sentiment.

Others:

• Fresnillo (FRES LN) + 5.4%; upgraded at HSBC, and boosted by strength in metals prices.


• Novo Nordisk (NOVOB DC) -1%; Company has discontinued its cell therapy R&D efforts. Company is not in the process of identifying partners with the right capabilities and manufacturing capacity to further develop innovation.


• Leonardo (LDO IM) +0.9%; Subsidiary company Leonardo DRS has launched a software platform integrating AI, advanced sensors and edge computing.


• BP (BP/ LN) +1.1%; Proposal to sell certain North Sea assets to Serica (SQZ LN); Serica to acquire assets for USD 232mln. (BP)

US Equity Futures: ES +1.9%, NQ +2%, ES +1.5%

• US futures are firmer following the decline on Friday after Trump reignited trade concerns as he threatened massive tariffs on China. However, on Sunday, Trump later softened his tone, by telling China not to worry.


• The docket ahead is void of any pertinent US releases, on account of the US Columbus Day holiday; some focus will be on the Fed's Paulson later.

13 Oct 2025 - 09:55- EquitiesGeopolitical- Source: Newsquawk