EUROPEAN EQUITY UPDATE: Stocks slip as risk sentiment falters

STOXX 600 -0.6%, FTSE 100 U/C, DAX 40 -0.8%, CAC 40 -0.8%, IBEX 35 -0.5%, FTSE MIB -0.8%, SMI -0.8%

• Despite a steady open, European bourses are now mostly lower. Selling pressure picked up after the cash open with no obvious catalyst for the price action at the time. From a fundamental perspective, fresh macro drivers have been lacking aside from ongoing focus on the Trump trade agenda ahead of the April 2nd "Liberation Day".


• For the session ahead, focus in the UK will fall upon Chancellor Reeves' spring statement which is set to unveil a reduction in spending plans after her headroom at the Autumn budget was wiped out by rising bond yields.

Sectors: Mostly negative

• Despite a mixed open, sectors now hold a negative bias with Health Care, Chemicals and Autos bottom of the pile. Of note for the latter, it's worth noting recent remarks from US President Trump in which he declared that Europeans have been "freeloading" and the EU has been "absolutely terrible" to the US. As such, the European autos sector will likely remain in his sights. Furthermore, potential tariffs on copper could hamper the sector from an input perspective. Additionally, Porsche (-0.7%) notes that its group result after tax for the fiscal year 2024 expected to reach approximately minus EUR 20.0bln due to non-cash effective Volkswagen AG (VOW3 GY) impairments


• To the upside, energy names are the clear outperformers alongside upside in underlying crude prices. Also of note for the sector, Shell's CEO said the company is open to acquisitions, but cautioned that pursuing large deals could be distracting. While not ruling out a merger with BP, he emphasised that any transaction would require a high threshold. Upside in the energy sector has helped underpin the FTSE 100 (U/C) and avoid the index slipping into the red.

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

• A slightly softer but broadly contained start to the European day. Modest action occurring alongside that seen in European bourses, but to a much lesser extent with the range for the ES only around 20 points thus far.


• Docket ahead features data and Fed speak but we are primarily awaiting updates on the tariff front.


• In specifics, China energy efficiency rules could hit NVIDIA (-0.7%); Apple (+0.1%) is expected to adopt TSM's (-1.0%) 2nm tech; Qualcomm (-0.1%) initiates antitrust campaign against ARM (-0.3%); Google (+0.3%) partners with Hon Hai on cloud; GameStop (+12.5%) approves BTC buying.

26 Mar 2025 - 10:05- ForexGeopolitical- Source: Newsquawk