Live Markets: On the radar: More gloom for Travel and Leisure

Amadeus Fire AG

28/02/2020 07:53

Welcome to the home for real-time coverage of European equity markets brought to you by Reuters
stocks reporters. You can share your thoughts with Thyagaraju Adinarayan
(thyagaraju.adinarayan@tr.com), Joice Alves (joice.alves@tr.com) and Julien Ponthus
(julien.ponthus@tr.com) in London. 
     
    ON THE RADAR: MORE GLOOM FOR TRAVEL AND LEISURE (0752 GMT)   
    Despite Wall Street’s plunge yesterday there is absolutely no “buy-the-dip”
sentiment floating around.
    Uncertainty is high, and that’s illustrated by British Airways-owner IAG which said it was
unable to give profit guidance for 2020 with the virus knocking travel demand.
    Europe’s travel and leisure index is down 14.5% so far this year and it’s likely not the end
of it as one can see with EasyJet. The budget airline’s shares are expected to go down this
morning after it warned about a "significant" softening of demand. 
    Still in the sector, Amadeus CEO confirmed the outbreak will have an impact on the travel
industry and the group's business this year. Good result, such as for BASF, might help companies
weather the storm better than their peers. 
    On the other hand, Munich Re and its 9% profit drop from natural catastrophes may not help
much. Shares are falling 7% at the moment. On top of that, resinsurers might have a mighty bill
to pay for the coronavirus epidemic. 
    Rolls-Royce’s 2019 operating loss of 852 million pounds may also no go down very well
despite engine deliveries and a good after-market performance.
    ThyssenKrupp’s sale of its elevator unit seems however to be doing the trick with its shares
rising in early trades. Still on the M&A agenda, LSE said it was on track to close the Refinitiv
deal. 
    The spotlight will also be on biotechnology company Novacyt which announced deals for its
"Primerdesign" product which is aimed at testing for the coronavirus.
    Another way to fend off sellers is with a increased pay-out, just like Austrian lender Erste
Group which said it would propose a dividend increase after reporting a flat operating result
for its fourth quarter.
    
    (Julien Ponthus) 
    *****


    
    BIG EARNINGS DAY: WHO CARES? (0652 GMT) 
    With the coronavirus scare causing mayhem across financial markets, you would be forgiven to
forget the fact that we are still in the thick of the earnings season. 
    Not that it matters much as trading based on fundamentals is not exactly the name of the
game today with European indexes expected to fall over 4%. 
    Big names are due though, such as BASF, CRH, LSE or Man Group.
    For the top news or European equities, click on  TOPEQE   
    Anyhow, for what it's worth here a list of the trading updates expected this morning: 
       
    (Julien Ponthus) 
    *****
    
    
    
    MORNING CALL: SET FOR THE WORST WEEK SINCE 2008 (0625 GMT) 
    The STOXX 600 is already down 9% this week and given that DAX, STOXX 50 and FTSE futures are
already falling about 4%, we're clearly set for the worst week since the financial crisis in
2008. 
    European bourses are bracing themselves for a brutal session after the S&P 500 experienced
its fastest correction in history and the Dow registered a record one-day points drop. 
    The U.S. fear index, the VIX, has surged close to 40 and its European cousin is currently at
its highest level since 2016. 
    Oil prices are locked in a worrying trend and on track for their biggest weekly decline in
more than four years.
    To have a look at the latest development of the coronavirus crisis which is causing mayhem
on financial markets please click here:  urn:newsml:reuters.com:*:nL8N2AB5TN
    (Julien Ponthus) 
    *****

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 (Reporting by Danilo Masoni, Joice Alves, Julien Ponthus and Thyagaraju Adinarayan)