Europe Factors to Watch-Shares set to dip; all eyes on ECB
PARIS, June 4 (Reuters) - European stocks were set to edge lower on Wednesday as investors moved to the sidelines ahead of key macro data for the euro zone as well as expected measures from the European Central Bank to support the region's economic recovery. At 0621 GMT, futures for Euro STOXX 50, Germany's DAX and France's CAC were down 0.2 percent, while UK's FTSE 100 futures were up 0.1 percent. Investors awaited an updated figure for the euro zone's first-quarter GDP, as well as service PMIs, which could shed light on the European Central Bank's next move. At its meeting on Thursday, the ECB is widely expected to trim its refinancing rate, send its deposit rate into negative territory and launch a long-term refinancing operation (LTRO) targeted at businesses. Despite recent economic data pointing to a slower-than-expected recovery for the euro zone, European stocks have been supported by the prospect of fresh intervention from the ECB, with Germany's DAX hitting a record high earlier this week. Euro zone peripheral markets have also been rallying on hopes of further measures from the central bank, with Milan's FTSE MIB index up 14.2 percent year-to-date and Madrid's IBEX up 8.7 percent. "The risk is that we get a 'buy the rumour, sell the news' move on the market ... European stocks' hefty valuation levels should prompt fund managers to book profits," Banque Leonardo strategist Francois Chevallier wrote in a note. Tesco shares will be in focus after Britain's biggest retailer posted the worst quarterly drop in underlying sales in its key home market since Chief Executive Phil Clarke took the helm in 2011, raising further questions over his trading strategy. The telecom sector will be in the spotlight after sources said Hutchison Whampoa has resumed talks with Russian telecoms group Vimpelcom over merging their Italian mobile firms. Europe bourses in 2014: (link.reuters.com/pad95v) Asset performance in 2014: (link.reuters.com/rav46v) ------------------------------------------------------------------------------ MARKET SNAPSHOT AT 0624 GMT: LAST PCT CHG NET CHG S&P 500 1,924.24 -0.04 % -0.73 NIKKEI 15067.96 0.22 % 33.71 MSCI ASIA EX-JP 487.74 -0.46 % -2.26 EUR/USD 1.3608 -0.14 % -0.0019 USD/JPY 102.72 0.23 % 0.2400 10-YR US TSY YLD 2.584 -- -0.01 10-YR BUND YLD 1.412 -- 0.00 SPOT GOLD $1,245.30 0.09 % $1.10 US CRUDE $102.82 0.16 % 0.16 > GLOBAL MARKETS-ASIAN SHARES DIP, U.S. YIELDS BOLSTER DOLLAR > US STOCKS-WALL ST ENDS A BIT LOWER A DAY AFTER DOW, S&P SET RECORDS > NIKKEI EDGES UP IN CHOPPY TRADE BEFORE ECB, U.S. DATA THIS WEEK > FOREX-EURO EASES BUT HOLDS ABOVE 4-MONTH LOW, FOCUS ON ECB > PRECIOUS-GOLD HOLDS NEAR 4-MONTH LOW AS INVESTORS AWAIT U.S. DATA > METALS-COPPER SLIPS TO 2-WK LOW, BUT CHINA PROSPECTS SUPPORT > BRENT HOLDS NEAR $109 AHEAD OF STOCK DATA, ECB DECISION COMPANY NEWS: TESCO Britain's biggest retailer posted the worst quarterly drop in underlying sales in its key home market since Chief Executive Phil Clarke took the helm in 2011, raising further questions over his trading strategy. REPSOL Mexico's national oil company Pemex will sell a 7.86 percent stake in Spanish oil firm Repsol, worth about 2.2 billion euros ($3.0 billion), Citigroup and Deutsche Bank said on Tuesday. The sale via an accelerated book build is expected to close on Wednesday. DEUTSCHE BANK Deutsche Bank will price an 8 billion euro ($10.90 billion)capital increase on Wednesday, likely at a big discount, to fortify its balance sheet ahead of regulatory checks and to complete a costly restructuring. SIEMENS The German Finance Ministry said on Tuesday it was not aware of any plans for the government to take a stake in Alstom as part of a possible deal between the French industrial group and its German rival Siemens. CAIXABANK CaixaBank is in advanced negotiations with General Atlantic and Warburg Pincus to sell a 15-25 percent stake in its credit cards unit for 500 million euros, Expansion reported, citing unnamed sourced with knowledge of the deal. VOLKSWAGEN Volkswagen aims to raise up to 2 billion euros by issuing new preference shares to fund its complete takeover of truck maker Scania. The company will likely issue the new preference shares at 191 euros ($260) apiece, a person familiar with the matter said. AIRBUS GROUP The planemaker said its new A350 aircraft successfully completed two "early long flights" with passengers operated with Air France and Lufthansa cabin crews on June 2 and June 3 in a further step towards the plane's entry into service. LAFARGE The French cement maker will combine its South Africa business with publicly traded Nigerian unit Lafarge Wapco, listing its Africa interests together on the Lagos bourse, its country chief executive officer said. UBISOFT The games maker announced "ongoing record sales" for its Watch Dogs game, which has sold more than 4 million copies in its first week, making it the company's best-selling game ever in week one. (Reporting by Blaise Robinson; Editing by Atul Prakash)
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