EUROPEAN EQUITIES UPDATE: Sentiment hit following nuclear related remarks via Russia's Kremlin

STOXX 600: -0.5%

• European bourses opened on a mixed/modestly firmer footing, with slight outperformance in the UK’s FTSE 100.


• Soon after the cash open, sentiment began to gradually slip.


• Thereafter, Russia’s Kremlin said "Russia reserves the right to use nuclear weapons in an event of aggression". This sparked a safe-haven bid, with equities selling-off to session lows, whilst the JPY and bonds soared to highs. This move has since stabilised, with equities currently residing at lows.

Sectors: Negative

• European sectors opened entirely in the green, but sentiment has since slipped and now shows a mostly negative picture in Europe.


• Basic Resources was initially buoyed by strength in metals prices, but has since faded into the red; Utilities remains the only sector in the green.


• Autos is found at the foot of the pile, joined by Consumer Products & Products, largely attributed to the risk-off sentiment. Banks are hit by the lower yield environment amid the risk-off mood.

European indices: FTSE 100 -0.3%, DAX 40 -1%

• The FTSE 100 fares better than the rest of Europe; and ultimately fairly resilient to the aforementioned geopolitical-induced sell-off. In terms of top movers; Imperial Brands (+1.9%) benefits after it reported strong FY results and after it noted that it is on track to deliver five-year capital returns of GBP 10bln. Diploma (-4.2%) falls after its FY results.


• The DAX 40 is lower having initially opened with a slight positive bias. Index-specific headlines have been light aside from a broker downgrade at Siemens (-2.1%). Other German Cos: Thyssenkrupp (+8%) soars after it saw its annual net losses narrow, which it attributed mainly to the write-down of its steel business, while sales were down on weak market conditions.


• Others: Nestle (-1.2%) lowered its FY25 profitability target, and said its water unit will become a new standalone company; it also said it would boost marketing spend under its new CEO.

US Equity Futures: ES -0.5%, NQ -0.6%, RTY -1.1%

• Futures are entirely in the red, with sentiment hit following comments via Russian Kremlin that noted it could respond to aggression in a nuclear manner.


• Markets continue to look to the incoming US administration's picks for top jobs (with the Treasury Secretary role in focus), while Wednesday's earnings update from AI bellwether Nvidia (NVDA) comes into focus.


• The US Day features October Building Permits (1.43mln expected vs prior 1.425mln) and Housing Starts (1.34mln expected vs prior 1.354mln). Fed’s Schmid is also due.

19 Nov 2024 - 09:55- EquitiesResearch Sheet- Source: Newsquawk