EUROPEAN EQUITY NEWS: Cautious tone in Europe whilst US is away amid the National Day of Mourning in honour of President Jimmy Carter

STOXX 600: U/C

European bourses began the European morning with a strong negative bias, continuing the downbeat mood seen in APAC trade overnight.
Sentiment has since improved to display a more mixed picture in Europe.

Sectors: Mixed

European sectors are mixed vs initially opening with a negative tilt.
Basic Resources is by far the clear outperformer today, benefiting from broad-based strength in underlying metals prices (following Chinese inflation data overnight); Energy and Healthcare complete the top 3.
Retail bottoms the index and is the clear underperformer today; there have been a few updates from UK retailers, where both Tesco and Greggs highlighted increased cost concerns following the UK Budget.

Majors: FTSE 100 +0.5%, SMI +0.4%, DAX 40 -0.2%

The FTSE 100 is the best performer in Europe today, for a few reasons. Firstly, the index may be catching a bid from the relatively weak Pound; Gilts gapped lower at the open, which took the 10yr just above 4.9% - though this has largely been pared, which helped to improve sentiment in the index. Further, Chinese CPI printed in-line, whilst the PPI figure printed a touch above expectations; as such, base metals are firmer and have helped to lift mining names such as Anglo American (+3.2%) and Antofagasta (+3.1%). To the downside, UK Retailers are broadly on the backfoot, given the heightened concerns of stickier inflation and jitters regarding the tax implications from the Autumn Budget; Tesco said, “the UK budget will result in around GBP 250mln/yr of additional national insurance costs”. It can be noted that M&S (-6.4%) and Tesco (-1.5%) reported fairly strong results whilst Greggs (-10%) and B&M European (-10.7%) were a little lower; the latter trimmed its guidance.
The SMI is on a firmer footing today, in-fitting with peers; Roche (+1.2%) is higher after the Co. said its momentum in digital pathology continues with FDA clearance on its high-volume slide scanner. Elsewhere, Partners (+1.1%) gains after receiving an upgrade at Barclays. Outside the SMI, VAT (-4%) slips after it reported slightly lower than expected sales figures.

US Equity Futures: ES -0.1%, NQ -0.3% RTY U/C

Futures reside largely in negative territory, with modest underperformance in the NQ; as a reminder, cash markets are shut on account of the National Day of Mourning in honour of President Jimmy Carter.
There are still some US events on the slate, however: Challenger layoffs data for December is due ahead of Friday's BLS jobs data, and there is a decent chunk of Fed-speak; Fed's Bowman (voter), Fed's Collins (2025), Fed's Schmid (2025), Fed's Harker (2026 voter), and Fed's Barkin (2027) are all due to deliver remarks today.