EUROPEAN EQUITIES UPDATE: Stocks opened higher but sentiment then slipped, OCDO LN -9%

STOXX 600: -0.2%

• European bourses opened modestly firmer across the board, but sentiment slipped as the morning progressed to display a negative picture – nothing really behind the turn.


• European markets digested UK GDP (in-line, UK saw no growth in July) and German/French/Spanish Final CPI (unrevised) – little follow-through to markets. There have been a number of ECB speakers following the announcement on Thursday; Simkus said inflation has stabilised; Villeroy said another cut is possible in the coming meetings; Kazaks said a meeting-by-meeting approach is still appropriate.


• For markets more broadly, on trade, US Treasury Secretary Bessent will meet with Chinese Vice Premier He and other senior Chinese officials next week in Madrid, while Bessent and He are to discuss key US-China national security, economic and trade issues. On the Fed, US President Trump's administration asked the US appeals court to pause a ruling that blocked the removal of Fed's Cook.

Sectors: Mixed

• European sectors are split down the middle, and with little overall newsflow driving this at the moment.


• Basic Resources takes the top spot, buoyed by strength in underlying metals prices. Insurance and Utilities follow closely behind. Autos is found at the foot of the pile, and then joined by Retail and Energy.

Others:

• Ocado -9%; Kroger said it is reviewing its automated e-commerce fulfilment network, but did ensure that it is continuing to use it heavily. Executives added that they plan to provide an update in Q3. For context, Kroger and Ocado are in a joint partnership, whereby the latter provides its fulfilment/tech platforms to Kroger. Following Kroger’s earnings call, Jefferies reiterated Ocado with Overweight. Analysts wrote that “we see these comments as in line with our expectations for Ocado’s U.S. business”, and their reiteration of OW does not factor in more Kroger Customer Fulfilment Centres.


• Hannover Re +3.1%; upgraded to Buy from Neutral at UBS.


• Ryanair +0.4%; Co. is prepared to cut another 1mln more seats from Spain by next summer, via the FT.


• Sabadell -1.2%; Board tells shareholders to reject BBVA's hostile takeover bid; offer does not reflect value.


• Temenos +0.4%; strong top- and bottom-line metrics.


• Novartis -2.5%; downgraded to Sell from Neutral at Goldman Sachs, citing growth concerns. Analysts highlighted that the recent outperformance may lose steam as the momentum story is “less clear”.

US Equity Futures: ES -0.1%, NQ -0.2%, RTY -0.5%

• Futures are lower across the board, with some underperformance in the RTY, paring back some of the strength seen in the prior session.


• The economic release docket is thin today, with highlights including the prelim US University of Michigan survey for September (headline seen down a touch to 58.0 from 58.2, conditions seen at 61.3 from 61.7, and expectations are seen at 54.9 from 55.9; last time out, the 1yr inflation gauge was at 4.8%, while the 5-10yr measure was at 3.5%).

12 Sep 2025 - 10:00- ForexEU Research- Source: Newsquawk