Europe before the bell: TSMC boost, Nestle miss
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EUROPE BEFORE THE BELL: TSMC BOOST, NESTLE MISS
European shares were set for a steady start on Thursday, ahead of a widely expected rate cut by the ECB later in the day and as soaring demand for AI applications helped Taiwanese chipmaker TSMC's 2330.TW profit growth beat expectations.
EuroSTOXX50 and FTSE futures were up 0.3 and 0.1%, respectively.
U.S. contracts also rose slightly following Wednesday's positive Wall Street close, driven by gains in small caps and strong earnings from Morgan Stanley and other banks.
In Europe, the pace of earnings releases was picking up. Despite disappointing results from large caps like ASML and LVMH, the region's top benchmarks remain near recent peaks.
The STOXX 600 .STOXX is up 8% so far in 2024, just shy of the record high set in September, supported by optimism over rate cuts and hopes for a soft landing in the U.S..
Nestle NESN.S was poised to fall at the open after the Swiss food group cut its FY sales outlook following weaker-than-expected underlying sales growth in the first 9 months.
"It's been a tough few months... after the unexpected departure of former CEO Mark Schneider, and against this backdrop of volatility, it should come as perhaps no surprise that these 3Q sales numbers paint a challenging picture of the current state of the Nestle business today," Bernstein wrote.
Finnish telecom equipment supplier Nokia NOKIA.HE echoed rival Ericsson ERICb.ST in seeing demand recovery in some areas after reporting a 9% rise in Q3 operating profit.
The solid update from TSMC could give support to Europe's chip stocks, such as Infineon IFXGn.DE and help soothe nerves following the rout in ASML shares this week. TSMC ADRs in Frankfurt gained 6% 2330y.F.
In banks, Finland's Nordea NDAFI.HE raised its ROE forecast and announced a new share buyback programme, after its Q3 results met market expectations.
Escalator maker Schindler SCHP.S reported a fall in Q3 sales as new installation declined, mainly in China.
(Danilo Masoni)
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EARLIER ON LIVE MARKETS:
ECB TO CUT, MARKETS WANT CLUES ON NEXT MOVE
ECB interest rates and rate expectations https://reut.rs/4f8LBf4
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