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Feb 5 (Reuters) - Welcome to the home for real time coverage of European equity markets
brought to you by Reuters stocks reporters and anchored today by Helen Reid. Reach her
on
Messenger to share your thoughts on market moves:
helen.reid.thomsonreuters.com@reuters.net
"WE'RE NOT AT THE ALARM BELLS PHASE YET" (1051 GMT)
Evidently volatility and equity market moves lower are at the forefront of investors' minds,
but Melissa Brown, managing director of applied research at Axioma, believes we're not at
the
alarm bells phase yet.
"For all of 2017 we saw markets going up and volatility coming down, so you have this very
slow ratcheting up of stock prices, and that will tend to lead to lower volatility, but that's
actually reversed this year," says Brown.
"What we've seen in the past is when you get volatility rising sharply while markets are
staying strong, that usually ends badly," she adds.
Brown points to new money flowing into the market at the beginning of the year as driving
some of the 'melt-up' as people didn't want to miss out on the rally.
"If you put money in today, and the market goes down by a fair amount tomorrow,
particularly
if you haven't been in the market, I think that's very disconcerting," Brown says.
(Kit Rees)
*****
EARNINGS SEASON SO FAR: EPS MISS BUT SALES BEAT (1016 GMT)Though
Europe's earnings season is still in its early days, Morgan Stanley (Xetra: 885836 - news)
strategists pick
out some interesting trends.
Of the 62 companies whose results they've tracked so far, 8 percent have missedearnings
consensus than beat. If this trend continues it would be the first quarter in three
years where Europe has seen misses than beats.Price reaction to results has also been
clearly negatively skewed - indicating investors are
in a punishing mood.
Sales so far have however been much better than earnings, a turnaround from the trend
seen
in third-quarter results, strategists said.
And while earnings revisions on average have come down slightly, they flag a sharp
divergence between sectors: commodities stocks are seeing very strong EPS upgrades
while
defensives have suffered further earnings downgrades.
(Helen Reid)
*****
TECH TAKES A TUMBLE (0849 GMT)
Tech stocks feature prominently among the biggest movers today - with the highlyvaluedchipmakers
the worst-performing. Siltronic (IOB: 0R8P.IL - news) , AMS (IOB: