EUROPEAN OPEN: ORCL falls as AI financing plans overshadow results; ASML NA to cut fewer jobs after union talks; FRAS LN bids EUR 2.7bln for BOSS GY; RYA ID faces CMA seat reservation probe; P911 GY, BAS GY upgraded

EUROPEAN OPEN:

European equities have opened lower, as global equities fall to the lowest level in over a month, as a tech-led selloff deepened amid ongoing conflict in Iran. Overnight, APAC equities fell to a three-week low after US forces struck multiple targets in Iran for a second consecutive day, in what CENTCOM called self-defence strikes, hitting surveillance systems, air defence sites and communications networks. Iran responded by announcing a halt to all vessels through the Strait of Hormuz. President Trump said he had spoken with Iranian officials who asked him to halt the bombing, but warned of further strikes if a deal was not signed.
Brent starts the European day below USD 94/bbl, paring gains after the US announced completion of its latest strikes. Bullion rebounded from lows near USD 4,025/oz overnight, heading into the European day around USD 4,090/oz, after the US military said it completed fresh strikes against targets in Iran. Copper fell to a three-week low after renewed US-Iran fighting lifted oil prices and inflation concerns, while potential Fed rate hikes ahead are also said to be pressuring base metals.
Ahead, the ECB is expected to raise rates by 25bps, its first hike since September 2023, as inflation rises after the Iran war; new forecasts may lift 2026 and 2027 inflation outlooks, and trim growth estimates (our full preview is below). US PPI metrics are also due. The FIFA World Cup gets underway today (11th June to 19th July), and traders should be cognizant of a potential thinning of liquidity conditions during matches through the soccer tournament.

STOCK SPECIFICS:

FINANCIALS: European companies’ operating margins are expected to grow 7.9% this year, the first expansion since 2022, led by oil, miners, chipmakers and banks, according to Bloomberg Intelligence; the recovery remains fragile; Barclays warns that the Iran war and higher oil prices could widen the gap between winners and losers.
TECH: Oracle (ORCL) shares fell over 10% in extended trading as plans to raise additional financing for its AI buildout overshadowed better-than-expected quarterly results and a higher profit forecast. ASML (ASML NA) will cut fewer jobs than initially planned after talks with Dutch unions; redundancies are expected from May 2027, with employees to be informed before the end of this month whether their roles are affected; ASML said some staff may have roles changed instead of being made redundant.
CONSUMER: Frasers Group (FRAS LN) launched a EUR 38/shr offer for the 74% of Hugo Boss (BOSS GY) it does not own, valuing the German fashion house at EUR 2.7bln. The low-premium bid follows Frasers’ roughly 26% stake-building. Hugo Boss said the offer was not coordinated, and will be examined.
UTILITIES: EDF and Centrica (CNA LN) are nearing draft terms with the UK government to extend Sizewell B’s life by two decades; the deal would provide a 20yr Contract for Difference from 2035-2055 at about GBP 70/megawatt-hour, requiring around GBP 800mln of private investment.
INDUSTRIALS: Airbus (AIR FP) signed a EUR 345mln contract with Thales Alenia Space (owned by HO FP and LDO IM) to develop and produce two advanced C-band radar instruments for the upcoming Sentinel-1 NG constellation. Thales’ (HO FP) German unit has received an order for 60 GO12 short-range battlefield radars for the German Armed Forces. The UK CMA is investigating whether Ryanair (RYA ID) seat reservation approach may charge parents to meet child safety and disability-related obligations under aviation rules; the investigation will assess whether the practice complies with consumer law. Wizz Air (WIZZ LN) reported FY26 revenue of GBP 5.69bln (vs 5.28bln Y/Y), and EBITDA of GBP 1.32bln (vs 1.13bln Y/Y); it gave no FY27 guidance, citing limited trading visibility and the Iran conflict. Halma (HLMA LN) reported FY25/26 revenue of GBP 2.58bln (exp. 2.57bln), adj. EBIT ex-one-offs of GBP 585.2mln (exp. 567.9mln), adj. EBIT margin 23% (exp. 22%); it guided FY27 adj. EBIT margin in line with FY26 levels.
HEALTHCARE: Belgium, the Netherlands, Luxembourg, Austria and Ireland said EU countries should align drug pricing policies and avoid uncoordinated national responses; the statement comes as the US and pharmaceutical companies increase pressure on EU countries over medicine prices. Novartis (NOVN SW) FORTITUDE study met its primary and key secondary endpoints, showing reductions in KHDC1L and creatine kinase levels, with a safety profile consistent with previous results. FDA granted Priority Review for Roche’s (ROP SW) Tecentriq in a certain type of stage III colon cancer; acceptance was based on the phase III Alliance ATOMIC study, where Tecentriq plus chemotherapy reduced recurrence or death risk by 50% versus chemotherapy alone.
NOTABLE BROKER UPDATES: Porsche (P911 GY) upgraded at Goldman Sachs; BASF (BAS GY) upgraded at Kepler; Neste (NESTE FH) upgraded at Santander; Volvo (VOLVB SS) upgraded at Pareto; EDP (EDP PL) upgraded at Goldman Sachs. DCC (DCC LN) downgraded at Stifel; Vodafone (VOD LN) downgraded at Barclays; Norsk Hydro (NHY NO) downgraded at Pareto.

DAY AHEAD:

EVENTS: Apple WWDC continues (8-12 June). US President Trump will sign a proclamation at 15:00EDT/20:00BST. The FIFA World Cup (11th June to 19th July) gets underway today, and traders should be cognizant of a potential thinning of liquidity conditions during matches through the soccer tournament.
DATA: US May PPI is expected to rise +0.7% M/M (prev. 1.4%), with the annual rate seen at 6.4% Y/Y (prev. 6.0%) and ex-food/energy/trade at +0.3% M/M (prev. 0.6%) and 4.4% Y/Y (prev. 4.4%). Weekly initial jobless claims for the week of 6th June are expected at 219K (prev. 225K), and continuing claims for 30th May at 1,780K (prev. 1,777K).
CENTRAL BANKS: ECB is expected to lift rates 25bps (deposit facility rate to 2.25% from 2.00%; refinancing rate to 2.40% from 2.15%; marginal lending rate at 2.65% from 2.40%); ECB President Lagarde will give a post-decision press conference, and will later appear on the Euro Matters podcast. Our ECB preview is below. The Norges Bank will publish its Regional Network Report. The CBRT is expected to keep rates at 37%.
SUPPLY: US auctions USD 22bln of 30yr bonds. UK auctions GBP 5bln of 2029 Treasury debt. Italy auctions EUR 3.5-4.0bln of 2029.
ENERGY: EIA natural gas storage change due. OPEC will publish its monthly oil market report.
EARNINGS: Notable companies reporting today include: Adobe (ADBE), Lennar (LEN).
ECB POLICY ANNOUNCEMENT (13:15BST/08:15EDT): Expected to hike by 25bps, taking the Deposit Rate to 2.25%. Justified by the assessment that the ECB is past the March baseline and is closer to the adverse scenario. Alongside this, inflation forecasts will likely be upgraded and growth downgraded across 2026. The cut off date will have influence on the 2026 inflation view, with a later date likely to see less hawkish projections. For growth, any signs of or commentary around a technical recession being possible. Guidance from the statement will be non-committal with the ECB to perhaps stress a vigilant approach to policymaking, which could be interpreted as a hawkish-nod. Lagarde may be somewhat more explicit vs the statement, in an attempt to stop inflation expectations from becoming unanchored.
Click here for Newsquawk’s full ECB preview