EUROPEAN EQUITY UPDATE: European bourses on the backfoot; Basic Resources sector gains amid stronger base metal prices

STOXX 600: -0.2%

• European bourses have opened largely on the backfoot, although wider macro newsflow has been light to determine the weak risk sentiment this morning, though a slew of European earnings have kept markets busy.


• Data this morning includes German, Italian, French and the wider Eurozone construction PMI. However, these data releases in Europe have failed to trigger any significant market reaction in European equities.


• This morning has also seen a slew of speakers with de Guindos and Schnabel. De Guindos reaffirmed general EU sentiment that inflation news is positive whilst Schnabel adds that policy stance needs neutrality and maintain policy space.


• Looking ahead all eyes will be on BoE announcement where policy rate is largely expected to be kept at 4.0%; Governor Bailey will speak thereafter. Other speakers in Europe include, ECB’s Lane and Nagel and Riskbank's Jansson.

Sectors: Mixed

• European sectors have opened negative/mixed. The outstanding performer within sectors is the Basic Resource sector (+1.3%), boosted by strength in underlying metals prices. Additionally, the sector has pulled back some gains after placing bottom amongst all sectors. Also at the top is Telecommunications (+0.7%) and Banks (-0.6%). Sentiment in Telecommunications has been fuelled by gains in BT (+4.5%) with the Co. confirming FY26 guidance and raised dividends.


• At the bottom is Construction (-1.1%), Insurance (-0.8%), and Travel & Leisure (-0.7%). Macro newsflow is once again light, but losses in Heidelberg Materials (-2.9%) after Co. released earnings with revenue failing to meet expectation, weighing down sentiment for the Construction sector whilst Travel & Leisure has seen sentiment pinned down by losses in Air France (-13.3%) after very poor Q3 results.

Movers:

• 
  Adecco (+9.2%) - Q3 (EUR): Revenue 5.776bln (exp. 6.01bln), net income 89mln (prev. 99mlnl Y/Y), expects Q4 revenue growth to be in line with Q3. (Adecco)


• 
  Zalando (+7.5%) - Q3 (EUR): Revenue 3.021bln (exp. 2.945bln), net income 12.5mln (exp. 43mln), confirms FY25 guidance; Adj. EBIT 550-600mln (exp. 574.2mln).


• 
  DHL (+6.3%) - Q3 (EUR): Revenue 20.1bln (exp. 20.1bln), EBIT 1.47bln, +7.6% Y/Y. Confirms outlook, and currently seeing limited impact from de minimis. (DHL).


• 
  Watches of Switzerland (+6.1%) - H1 (GBP): Revenue 845mln (prev. 785mln Y/Y). Notes that demand for luxury watches remains robust and continues to exceed supply, with consistent additions to and conversions of the client Registration of Interest lists. Luxury watches revenue +10% at constant currency. Luxury jewellery revenue +10% at constant currency, making up 12% of Group revenue. Luxury branded jewellery outperforming.


• 
  Commerzbank (-2.2%) - Q3 (EUR): Revenue 2.939bln (exp. 2.974bln), NII 2.044bln (exp. 2.036bln), sees FY25 NII about 8.2bln (exp. 8.1bln). (Commerzbank).


• 
  Diageo (-2.9%) - Q1 (GBP): Net sales 4.875bln (prev. 4.986bln Y/Y), flat organic net sales growth +2.9%, sees FY26 organic net sales growth to be flat to slightly down due to negative impact from Chinese white spirits and a weaker US consumer. FY26 free cash flow to be near USD 3bln (prev. 2.7bln Y/Y). (Diageo).


• 
  Maersk (-6.3%) Q3 2025 (USD): EBITDA 2.7bln (exp. 2.583bln), EBIT 1.284bln (exp. 930mln), Revenue 14.21bln (exp. 13.8bln), Sees FY underlying EBITDA between 9.0-9.5bln (exp. 9.11bln)

US Equity Futures: ES U/C, NQ U/C, RTY -0.2%

• US equity futures are flat/negative. RTY (-0.2%) and YM (-0.1%) are down, whilst the NQ and ES are flat. Main focus for the day was an early release of the US Challenger Layoffs, which jumped 175.3%, to a 7-month high at 153.074k (prev. 54.064k); a very modest uptick in futures was seen on the surprise release.


• Looking ahead in the US are the Chicago Fed Labour Market Indicators. Speakers include Fed’s Williams, Barr, Hammack, Waller, Paulson and Musalem. Staying in North America, BoC Governor Macklem and Deputy Governor Rogers will speak before a Senate Committee.

06 Nov 2025 - 10:15- EquitiesData- Source: Newsquawk