EUROPEAN EQUITY UPDATE: FTSE 100 shines as metals pushed higher on speculation of future China housing stimulus

STOXX 600:

• Began the session with fair gains, which have been built on as the morning progresses, boosted by continuing gains in China-related stocks.


• The FTSE 100 outperforms with miners boosted following reports speculating that housing-market support could be on its way. Analysts suggest this support could come in the form of a high-level meeting, a Jefferies analyst suggesting President Xi could attend with focus on a new Shantytown reconstruction program. They also noted the government rolled out a similar program in 2014, which was expanded in 2016, adding “if there is a fresh effort it is not expected to be a large-scale push this time, an urban renewal program is more likely”. The CAC also benefits, luxury names LVMH (+1.7%) , Kering (1.7%) and Remy Cointreau (+5.0%) benefiting.


• On the trade front, stocks have shrugged off Trump’s confirmation of 50% copper tariffs, threat of 50% tariffs on Brazilian goods and tariff rates for seven countries, potentially a TACO trade play.


• From a European perspective, optimism remains over US-EU trade talks, with EU trade commissioner Sefcovic noting good progress on a framework trade agreement, and suggesting that a deal could be announced within days.


• The European day ahead sees ECB's Cipollone, speaking on the Digital Euro; BoE's Breeden will give remarks on financial stability.

Sectors: Positive

• Opened entirely in the green, now a few sectors have moved into negative territory while basic resources extends gains.


• At the top lies basic resources, higher by 3.7%. It's been an eventful week for miners, with a Glencore broker move boosting the sector on Tuesday, LME copper prices pushing it lower on Wednesday, and the aforementioned Chinese stimulus speculation benefitting names this session.


• Also performing well is Tech, which takes the second spot with ASML (+0.6%) boosted in sympathy with NVIDIA gains after becoming the first company in history to hit the USD 4tln market cap intraday, whilst TSMC revenue also topped expectations.

Individual Movers

• Firmer metals prices amid Chinese optimism: Rio Tinto +4.6%, Anglo American +4.1%, Glencore +4.7%


• Asia-exposed banking: Stan Chart +2.7%, HSBC +0.9%


• Luxury: LVMH +1.5%, Kering +1.7%, Remy Contreau +4.1%


• WPP +3.5%: CEO retires, Cindy Rose appointed as Chief, follows a profit warning on Wednesday


• Suedzucker -0.5%: Poor earnings, posted an 85% fall in quarterly operating profit, follows guidance late on Wednesday

US: ES U/C, NQ U/C, RTY -0.1%

• US futures are in lacklustre summer trade, with futures trading around the unchanged mark. The numerous trade updates seem to have been overlooked by markets, with the TACO trade in play, as we await the all important potential EU deal, in which talks seem to be constructive.


• On the docket ahead, US Weekly Initial Jobless claims are expected to rise a touch to 235k from 233k; continuing claims for are seen inching up to 1.974mln from 1.964mln. In energy, OPEC will release its World Oil Outlook report. On the speakers' slate, Fed Dove Waller is to speak on the balance sheet, which in March he said there was“no need to slow drawdown at this time”; Fed's Musalem will speak on the economy and monetary policy; Fed's Daly will give remarks on the outlook. Notable US corporates reporting today include: Delta Air Lines (DAL), Conagra Brands (CAG), Levi's (LEVI). In supply, the US will sell USD 22bln 30yr bonds.

10 Jul 2025 - 10:05- ForexGeopolitical- Source: Newsquawk