EUROPEAN EQUITY OPEN: Stocks up ahead of US jobs data, G7 talks on Russia price cap

INDICES: At 08:17BST, Euro Stoxx 50 +0.53% at 3,475; FTSE 100 +0.14% at 7,158; DAX +0.87% at 12,740; CAC 40 +0.41% at 6,059; IBEX 35 -0.13% at 7,796; FTSE MIB +0.55% at 23,415; SMI +0.62% at 10,729.

OPEN: Ahead of the key US jobs report, which will have some influence on how aggressive Fed policy will be in the short-term, Wall Street pared back losses in late trading on Thursday, while the APAC session was more mixed in tone; European equity indices are gaining after the Friday open. While the US jobs report is the key release today, energy will also be in focus as G7 finance minister will hold talks on the Russia oil price cap.

STOCK SPECIFICS: On the index level, Nokia (NOKIA FH) and Nordea (NDA FH) are to join the Euro Stoxx 50, with Kone (KNEBV FH) and Philips (PHIA NA) to exit. In deal news, SK Capital and Edgewater Capital announce the acquisition of Saint-Gobain (SGO FP) Crystals business, with some suggesting the business is valued at USD 214mln; UK CMA clears Avast (ASVT LN) merger with NortonLifeLock (NLOK); Deutsche Telekom's (DTE GY) T-Mobile US (TMUS) has reportedly won a majority of the 2.5GHz spectrum licenses, spending USD 304mln; Shell plc (SHEL LN) and Exxon Mobil Corporation (XOM) subsidiaries confirm they will sell interests in Aera JV to German asset manager IKAV for around USD 4bln. Separately, Shell (SHEL) CEO van Beurden is reportedly preparing to step down in 2023. In industrials, Lufthansa (LHA GY) pilots are on strike, today and the airline has been forced to cancel hundreds of flights. In broker moves, HSBC downgrades UK housing names Barratt Developments (BDEV LN), Bellway (BWY LN), Berkeley Group (BKG LN), Crest Nicholson (CRST LN), Persimmon (PSN LN), Redrow (RDW LN), Taylor Wimpey (TW/ LN); Goldman Sachs downgrades some materials names including Covestro (1COV GY) and Givaudan (GIVN SW), but upgrades CHR Hansen (CHR DC). In financials, Credit Suisse (CSGN SW) is reportedly launching a wealth business in China next year.

DAY AHEAD: The European data slate is thin, with the EU producer prices data for July the only notable release. The bulk of focus today will be on the US jobs report, where the headline is expected to resume cooling, and average hourly earnings are expected to continue rising, a cocktail that should still give the Federal Reserve cover to lift rates by 75bps on September 21st (also subject to the US CPI report on September 13th) – our NFP preview is here. Meanwhile, energy will be in focus as G7 finance minister will hold talks on the Russia oil price cap. Our full Day Ahead is here.

02 Sep 2022 - 08:17- Research Sheet- Source: Newsquawk