EUROPEAN EQUITIES UPDATE: Stocks consolidate following yesterday's slide

STOXX 600: U/C

• Stocks in Europe trade mixed/mostly firmer in what is seemingly consolidative trade following the prior day's slide, facilitated by tariff woes igniting growth concerns.


• This also comes ahead of tomorrow's 25% US tariff on all steel and aluminium imports coming into effect, with "no exceptions or exemptions".


• Overnight, APAC stocks took their cues from the tech-led sell-off stateside after the Nasdaq's worst day since 2022 amid recession fears and tariff-related concerns.


• The European Day Ahead is thin, with no major data scheduled for release. On the speakers' slate, ECB President Lagarde, Vice President de Guindos, Chief Economist Lane, Villeroy, and Escriva will speak at the annual ECB Watchers conference.

Bourses: Euro Stoxx 50 +0.4%, DAX 40 +0.7%, CAC 40 +0.6%, FTSE 100 -0.1%

• 
  Euro Stoxx 50 and DAX 40 are supported by gains in German autos following well-received numbers from Volkswagen but gains capped by SAP's performance post-Oracle earnings. (more below in the movers section).


• Furthermore, sentiment in Germany is underpinned by early-door reports that Germany's Green party co-leader said they are hopeful of a defence deal occurring this week.


• 
  CAC 40 is supported by upside in Schneider Electric after SK Telecom announced it is to strengthen AI Data Centre capabilities with the Co. Furthermore, luxury stocks are supported following resilient trade in China overnight and amid expectations of a US-Sino leader's meeting (SCMP flagged April whilst WSJ reported a potential June summit) alongside more stimulus from the nation to support domestic demand. On the flip side, banks continue to be pressured.


• 
  FTSE 100 is the current laggard amongst the majors, with losses in banks and travel (more below) offsetting gains in homebuilders - who dominate the top of the index following Persimmon's metrics (more below in the movers section).

Sectors: Mixed

• Overall mixed with no overarching theme or bias but with participants reacting to earnings in the absence of a fresh macro impulse.


• 
  Basic Resources recently took the top spot as base metals are boosted by a crumbling Dollar this morning - albeit this comes ahead of the 25% US tariff on all steel and aluminium set to kick in tomorrow.


• 
  Autos and parts sector is among the outperformers as a post-earnings Volkswagen lifts peers - with BMW, Mercedes-Benz, Renault, and Stellantis all benefiting.


• 
  Travel & Leisure is the marked underperformer as airliners are notably hit by US-listed Delta Airlines cutting its EPS guidance - with IAG, Deutsche Lufthansa, and Air France-KLM all plumbing the depths.

Movers:

• 
  Volkswagen (+1.3%) FY (EUR): Revenue 324.7bln (exp. 321.7bln), Op. Profit 19.06bln (exp. 17.92bln). 2025 Guidance: Op. RoS 5.5-6.5% (exp. 6.2%); proposes a dividend of EUR 6.30/shr, and expects challenges from an environment characterised by political uncertainty, increasing trade restrictions, geopolitical tensions and increasing competition in 2025.


• 
  SAP (-0.7%) after Oracle (ORCL) shares fell 3.3% post-earnings after reporting underwhelming numbers.


• 
  HelloFresh (-12.2%) expects its North American segment revenue overall to decline more meaningfully than headline revenue. Noticed a somewhat weakening consumer confidence in North America.


• 
  Broker Moves: Burberry (+3.0%) was upgraded at BNP Paribas; Glencore (+1.4%) was initiated with Buy at Berenberg; LSE (+1.5%) was upgraded at Oddo; Lloyds (-1.9%) was downgraded at Keefe; Metro Bank (+1.4%) was upgraded at Peel Hunt.

US Equity Futures: ES +0.4%, NQ +0.6%, YM +0.3%, RTY +1.0%

• US equity futures are firmer intraday but largely consolidating after yesterday's slide sparked by recession fears and tariff-related concerns.


• Tesla (+4.3% pre-market) rises after yesterday's near-15.5% plummet, with US President Trump suggesting he will buy a Tesla to support Elon Musk amid boycotts.


• NVIDIA (+1.4% pre-market), AAPL (-0.1% pre-market), and Meta (+0.6% pre-market) are mixed after slipping between 4-5% yesterday.


• Today's US docket is also thin in terms of scheduled events, but does feature the US JOLTs data for January, where 7.63mln is expected at the headline level (prev. 7.6mln); in December, the Quits Rate was unchanged at 2.0%, while the Vacancy Rate eased to 4.5% from a revised 4.9%. Elsewhere, the NFIB's February Business Optimism Index is due, as is the weekly Redbook data.

11 Mar 2025 - 10:00- ForexEU Research- Source: Newsquawk