Here’s What to Watch in European Stocks This Morning

(Bloomberg) -- Good morning. Here’s what we’re watching ahead of the market open in Europe, including earnings from oil and chip companies, ongoing strife around Brexit and the last of the FANG stocks to report.

Referendum Strife

The U.K.’s business secretary, Greg Clark, said the government’s failure to agree on Brexit is holding back investment, as the row over the decision by Nissan Motor Co. to halt plans to produce a new SUV in the country rumbles on. Consumer spending plans have been sapped, home prices in London’s priciest areas have been thumped and the amount of debt Brits are holding is making them very pessimistic about the future. Still a deal has been done on derivatives clearing post-Brexit. The U.K. doesn’t have a monopoly on controversial referendums. French President Emmanuel Macron’s team is strongly advising him against holding one this year as he tries to draw a line under the Yellow Vest protests.

Back to Life

European earnings kick back into gear after a relatively sleepy Monday, topped by BP Plc taking its turn in the wake of a series of blow-out beats from its oil industry peers at home and abroad. Russian crude giant Rosneft Oil Co. is reporting too. Also watch the update from Europe’s biggest chipmaker, Infineon Technologies AG, for some bellwether read-through on the state of the semiconductor industry. And keep an eye out for numbers from one of Europe’s best=performing stocks last year in the shape of grocery delivery firm Ocado Group Plc and from one of the worst, Danish charm bracelet merchant Pandora A/S.

Google’s Wallet

Shares in Google parent Alphabet Inc. dipped in late trading as one of the biggest companies in the world remains in growth mode, spending big to boost its cloud and YouTube businesses. M&A could become the flavor of the day in big tech, with JPMorgan analysts suggesting Apple Inc. may want to put its huge pile of cash to use via deals . They’re speculating on the likes of smart-speakers manufacturer Sonos Inc.,  video-game maker Activision Blizzard Inc. and streaming giant Netflix Inc. being possible targets.

Odd Couple

U.S. President Donald Trump and Federal Reserve Chairman Jerome Powell had dinner together on Monday, a meeting that comes in the wake both of Trump criticizing the Fed chair for raising interest rates and the Fed itself turning more dovish. Trump’s having a busy lead-up to his State of the Union. He is said to be planning to nominate David Malpass, a senior Treasury official, to be World Bank chief and his inaugural committee is said to be  facing a probe from federal prosecutors in New York. 

Coming Up…

President Trump will deliver the State of the Union address and between the applause lines ears will be trained for anything about Nafta, trade with China plus anything about trying to reform drug pricing. Closely-scrutinized services PMI data for the U.K. and the euro area is due. European Commission President Jean-Claude Juncker will speak in Brussels and we’ll have a few speakers from Sweden’s Riksbank, so watch the krona.

What We’ve Been Reading

This is what’s caught our eye over the last 24 hours

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