* European stocks tumble as poor earnings weigh
* TUI sinks 18 pct after cutting profit outlook
* Publicis and GEA Group down 14 pct after results
* Silver linings: UniCredit, ICA, Compass, Beazley
Feb 7 - Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Josephine Mason. Reach her on Messenger to share your thoughts on market moves: josephine.mason.thomsonreuters.com@reuters.net
INVESTING IN UNINVESTIBLE BRITAIN (1036 GMT)
With the fate of Brexit impossible to forecast, British stocks remain highly unpopular among investors but the steep discount offered by the once-premium stock market could be tempting.
Bernstein strategist Inigo Fraser-Jenkins and team say UK equities remain uninvestible but have nevertheless put their quantitative tools at work to spot possible opportunities.
To do so, Inigo & C scan through all possible pairs of UK-European stocks. They isolate those tied to the same end-markets or macro forces and then pick among the most correlated pairs the ones where the discount is steepest for the UK stock.
Here's the outcome:
They also use another way to spot opportunities. They compare valuations of companies drawn from sub-industries in the two markets and again identify the UK stocks which are at their deepest discounts compared to history.
They identify more than 30 pairs. Below you can see a few:
"If one has to buy UK stocks we suggest that these pairs of UK vs Europe ex UK stocks are a good starting point for a portfolio," they say.
(Danilo Masoni)
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POOR EARNINGS BURN EUROPEAN STOCKS AS PUBLICIS, TUI, GEA SINK (0834 GMT)
European stocks are sliding as terrible earnings take the wind out of a rally that took the STOXX 600 to 12-week highs yesterday.
French advertising agency Publicis PUBP.PA hit a six-year low in early trading, and is slumping 12.7 percent after reporting negative fourth-quarter revenue growth - far below market expectations. It's dragging WPP (LON:WPP) down 7.5 percent too.
German food processing machinery company GEA Group fell 14 percent after it scrapped mid-term targets and said operating income would decline this year. shares are also tanking, down 16.7 percent and the biggest STOXX fallers, after the tour operator slashed its profit outlook, blaming last summer's hot weather and the weak pound. Cook Group TCG.L , on the other hand, rapidly reversed its early losses and is now up a whopping 15.8 percent as investors cheer its plan to sell its airline. a silver lining are Unicredit (MI:CRDI), rising 2.9 percent after its strong results, Swedish retailer ICA up 6 percent at the top of the STOXX, and UK insurer Beazley.
(Helen Reid)
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PLANES, TRAINS AND AUTOMOBILES... AND SOME BANKS (0756 GMT)
European stock futures are heading south this morning after the STOXX 600 hit 12-week highs on Wednesday as investors digest a slew of earnings from the banking, travel, auto and media sectors.
Germany's DAX, the most sensitive to China-U.S. trade tensions, is underperforming its European peers, a sign of rising investor jitters as the March 2 deadline fast approaches before new U.S. tariffs on Chinese goods hit.
Italy's biggest bank UniCredit, and Banco BPM, were expected to open higher after their results.
Unicredit's Q4 profits beat expectations while BPM has reported a Q4 loss of 584 million euros ($664 million) after writing down impaired loans for nearly 1 billion euros but said it expects its cost of funding this year to fall even without taking into account a possible new TLTRO from the ECB.
SocGen cut its profitability target, the latest warning from the bank whose investment and corporate banking business was hit by the Q4 market downturn. Traders expect the shares to open higher though as investors draw comfort from the bank's earnings presentation which has helped allay fears it may have to raise capital.
The news comes just a day after weak results from BNP Paribas (PA:BNPP) and weeks after France's third-largest bank issued a profit warning. Insurance stuck to its financial targets and proposed to raise its dividend to 19 Swiss francs a share.
Downbeat comments from Volvo Cars, owned by China's Geely, and Osram Licht about the state of the car market as the U.S.-China trade war drags on may add to gloom following Daimler's results yesterday. German lighting company Osram shares were indicating down 3 percent after reporting a Q1 loss.
German machinery maker GEA is down 6 percent in pre-market after scrapping its mid-term targets and warning income would fall this year.
Travel operators are in focus and not for good reasons.
TUI shares are seen falling as much as 10 percent after slashing its earnings guidance for its fiscal full year, blaming last summer's hot weather and the weak pound that weighed on the purchasing power of its British customers. Thomas Cook said it was launching a strategic review that would include the sale of its airline business to raise cash and help it recover from a rough 2018 and weaker demand in 2019. Hot on the heels of Germania's collapse and Ryanair warning of industry consolidation, Norwegian Air, Europe's third-largest budget carrier by passenger numbers, has cut its capacity growth for this year. four-engined jet suffered another blow as Qantas Airways cancelled a longstanding order for eight Airbus SE A380 superjumbo jets.
Publicis shares are expected to sink after the world's No. 3 advertising company reported fourth-quarter net revenue far below market expectations. It's likely to drag WPP with it.
Aside from all that bad news, Total will likely give another lift to oil stocks after the French oil major's jump in profits and pledge to raise its dividend again and Sanofi (PA:SASY) was expected to get a boost after posting slightly higher than expected fourth-quarter earnings, helped by strong growth at its rare diseases Genzyme unit.
(Josephine Mason)
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FUTURES HEADING SOUTH (0712 GMT)
European stock futures are heading south, with Germany's DAX, the most sensitive to China-U.S. trade tensions, down 0.5 pct, a sign of investor jitters are rising as the March 2 deadline before new U.S. tariffs on Chinese goods hit fast approaches.
The next major trigger for markets will be any breakthrough in the talks when the world's top two economies meet in Beijing next week. Hopes of a resolution are low, and traders expect volatile markets in the meantime.
It could be a big day for the pound with the BoE's rate decision (no change expected) and quarterly outlook for the UK economy later. UK PM May is also heading to Brussels with the words of the President of the European Council ringing in her ears that there is a "special place in hell" for people who promoted Brexit without any plan.
(Josephine Mason)
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ON THE RADAR: MORE BANKS, CARS AND TRAVEL (0700 GMT)
Markets might be taking a breather but there's a slew of earnings and corporate news this morning with banks, autos and travel in focus.
It's a mixed bag for banks: Italy's biggest bank UniCredit has posted a much higher than expected fourth-quarter profit, but the country's No. 4 bank Banco BPM has reported a Q4 loss of 584 million euros ($664 million) after writing down impaired loans for nearly 1 billion euros to ease a large disposal. said it would complete the 7.4 billion euro bad loan sale in the first half of 2019 after reaching an accord last year with Elliott and Credito Fondiario, the Italian bank and bad loan specialist controlled by the U.S. fund.
More bad news for French banks with SocGen cutting profitability target, the latest warning from the bank whose investment and corporate banking business was hit by the Q4 market downturn. The news comes just a day after weak results from BNP Paribas and weeks after France's third-largest bank issued a profit warning. Insurance stuck to its financial targets and proposed to raise its dividend to 19 Swiss francs a share.
Downbeat comments from Volvo Cars, owned by China's Geely, and Osram Licht about the state of the car market as the U.S.-China trade war drags on may add to gloom following Daimler's results yesterday. lighting company Osram said all its divisions fared badly in its fiscal first quarter due to a weakening Chinese market and a downturn in the auto sector leading to a net loss of 5 million euros.
Tour operator TUI has slashed its earnings guidance for its fiscal full year, blaming last summer's hot weather and the weak pound that weighed on the purchasing power of its British customers. Thomas Cook is due to issue its Q1 trading statement today.
Coming hot on the heels of Germania's collapse this week and Ryanair warning of industry consolidation, Norwegian Air, Europe's third-largest budget carrier by passenger numbers, has cut its capacity growth for this year. four-engined jet suffered another blow as Qantas Airways cancelled a longstanding order for eight Airbus SE A380 superjumbo jets.
Other headlines of interest:
ArcelorMittal sees slight steel demand growth in 2019
Novartis CEO says U.S. rebate plan will return cash to patients CEO says has cash for "strategic decisions" despite loss sees slight steel demand growth in 2019 Hydro Q4, dividend miss forecast amid continuing Brazil woes Chrysler, Bosch agree to pay $66M in diesel legal fees - filing Air puts breaks on 2019 growth plans 1-Klepierre less upbeat on 2019 after forecast-beating results maker GEA flags profit decline as new CEO set to take helm held a 9.547 pct stake in Telecom Italia (MI:TLIT) as of Jan. 31
(Josephine Mason)
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EUROPE TAKING A BREATHER (0615 GMT)
European stocks are expected to open slightly lower this morning, taking a breather this morning after hitting 12-week highs on Wednesday as investors await news on the U.S.-China trade talks next week. The weaker close on Wall Street will also take some of the shine off proceedings.
Asian markets overnight have been inching higher, although Spring Festival celebrations have sapped volumes.
IG Financial spreadbetters expect London's FTSE to open 8 points lower at 7,165, Frankfurt's DAX to open 39 points lower at 11,286 and Paris' CAC to open 16 points lower at 5,063.
(Josephine Mason)
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https://tmsnrt.rs/2ULWFFA Inigo 2
https://tmsnrt.rs/2BqIQVY
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