EUROPEAN EQUITY UPDATE: Stocks mostly firmer, earnings weigh on the FTSE 100

Analysis details (09:22)

European equities (Eurostoxx 50 +0.4%) trade mostly firmer in what has been a particularly busy morning of earnings for the region. Overnight, APAC stocks lacked firm direction amid holiday-thinned trading conditions, with Japan away for the Emperor's Birthday. Note, the Hang Seng entered into a technical correction of 10% after closing with losses of 0.4%. US equity futures (ES +0.4%, NQ +0.8%, RTY +0.3%) are green, recovering from lows seen in wake of the hawkish FOMC meeting minutes released on Wednesday. NQ outperforms peers on account of strong after-hours earnings from NVIDIA (+8.6% pre-market) after the Co. beat on top and bottom lines whilst providing encouraging guidance. For the US session ahead, a second look at US GDP in Q4 and weekly jobless claims data are due. Note, there are still further data on jobs and inflation ahead of the March 22nd FOMC, and accordingly, these data will shape expectations of what the Fed will do at that meeting (the base case still sees a 25bps rate hike, although the probability of a larger 50bps has increased recently). Equity sectors in Europe hold a slight positive bias with tech names top of the pile following the tailwinds from NVIDIA earnings. Autos are also on a firmer footing following another session of gains for Stellantis (+4.6%), whilst Media names are benefiting from post-earnings upside in WPP (+4.5%). To the downside, Basic Resource names lag with Anglo American (-2.3%) suffering post-earnings and weighing on the FTSE 100 (-0.3%) in combination with post-results losses in BAE Systems (-2.9%) as well as a slew of large-cap ex-dividend stocks. Cushioning the blow for the FTSE 100 and one of the standout outperformers for the session is Rolls Royce (+15.4%) which is seeing its shares soar after beating on profits and stating that “we are capable of much more”. Elsewhere, Wood Group (+31.3%) shares are sharply higher after recently being approached by Apollo Global Management; an approach which it has since rejected. Other earnings highlights include Pirelli (+4.8%), Axa (+3.5%), Bouygues (+2.9%), Telefonica (+2.3%), Accor (+1.6%), Deutsche Telekom (+1%), Munich Re (-4.8%), Solvay (-3.7%), Getlink (-3.6%), EssilorLuxottica (-2.6%), Eni (-1.3%).

23 Feb 2023 - 09:22- Research Sheet- Source: Newswires