GVC.L Share News (GVC)

* European stocks hit one-month lows as gloom over economy deepens
* STOXX 600 down 1.4%, set for worst two-day drop since early August
* Trade-sensitive miners fall 2.6%, industrials down 1.7%, cars -1.4%
* Flutter rallies on tie-up with Canadian rival
* WTO decision on US aircraft subsidy retaliation rights due at 1400 GM

Welcome to the home for real-time coverage of European equity markets brought to you by Reuters
stocks reporters and anchored today by Josephine Mason. Reach her on Messenger to share your
thoughts on market moves: josephine.mason.thomsonreuters.com@reuters.net

DOUBLE WHAMMY: BONDS AND STOCKS BOTH FALL (1105 GMT)
You know the market is worried when safe-haven bonds and riskier equities are both falling.
The two markets are in rare correlation this morning, although stocks are bearing the brunt
of the selling, with the pan European STOXX 600 and the euro-zone benchmark
both set for their worst day since Aug. 14 for a second day in a row.
It's a double whammy in Europe because investors are worried the ECB has less firepower to
shore up the euro-zone economy after its largesse in September and the decision to cut interest
rates deeper into negative territory.
That leaves the region more vulnerable to the slowing global economy than the United States,
where the market is pricing in a 65% probability of another rate cut this month from the Federal
Reserve.
Stéphane Barbier de la Serre, macro strategist Makor Capital Markets SA, says weak Swedish
manufacturing data and a contraction in Swiss factory yesterday were a harbinger of things to
come yesterday afternoon.
While not the largest in the region, a slowdown in two export-heavy economies was a
particularly worrying sign even before the U.S. factory data yesterday afternoon, which was in
itself "beyond belief", he says.
"If you look at the macro picture, the market's just too high," he says.
Signs that the manufacturing recession in Germany and elsewhere is spreading to the labour
market and consumer spending will rattle markets further.
"When spillover effects into the services sector are showing their ugly face then equities
will begin to ruthlessly reprice to the reality of a recession," says Peter Garnry, head of
equity strategy at Saxo Bank in a note this morning.
Attention will now turn to the U.S. nonfarm payrolls due on Friday. "If non-farm payrolls
are bad on Friday, can you imagine what will happen?" asks Barbier de la Serre.
Below is a chart showing German government bond yields ticking up while the STOXX 600 dips:



(Josephine Mason)
*****


SAYING GOODBYE TO ROTATION INTO VALUE (0956 GMT)
The gloom over a global manufacturing slowdown is creating an unpleasant mood as October
kicks off with pessimism over the economic outlook and the unpredictable trade talks is leading
some to doubt that the rotation into cyclical and value that shaped price action in September
has more to go.
Among them is Mark Haefele, chief investment officer at UBS Global Wealth Management, who
expects stocks to remain range-bound and recommends a modest underweight to equities.
"We don't expect the bounce in value relative to growth, and cyclicals relative to
defensives, to last," he says.
"Since the Global Financial Crisis in 2008–09, global value stocks have underperformed
growth by 70%, including dividends. A significant driver of this trend has been the relentless
decline in global bond yields... overall in the third quarter bond yields declined
significantly, and we don't expect them to move much higher in the foreseeable future," he adds.
His base case is that trade tensions will remain high with global growth slowing in 2020 to
its slowest pace since the Global Financial Crisis.

(Danilo Masoni)
*****


OPENING SNAPSHOT: GLOBAL GLOOM KNOCKS EUROPE (0738 GMT)
Renewed worries about a global manufacturing slowdown triggered by decade-low factory data
from the United States have pushed European stocks to one-week lows in early deals, adding to
the market's worst day in nearly two months yesterday.
The numbers from the world's No. 1 economy extinguished the last bright spot in global
manufacturing outlook so it's not that surprising to see another rout from riskier assets.
The weak data and subsequent drop in copper prices are hurting mining companies,
which are down 1.6% at their lowest since Sept. 4 and the weakest performing sectoral index.
Travel & leisure is the only sector in positive territory, up 0.6%, due to
dealmaking in the gambling sector. Paddy Power owner Flutter and Canada's Poker Star
have agreed all-share tie-up that will create one of the world's top online betting companies.
Flutter shares are up over 12% at their highest since June last year and the top
gainer on the pan-European STOXX 600 and lifting European rivals GVC and
William Hill with it.


(Josephine Mason)
*****


ON OUR RADAR: ATLANTIA, CAR SALES AND TESCO (0658 GMT)
It's pretty gloomy out there. European stock futures are on the backfoot as the hangover
from the dismal factory data and weak U.S. car sales continues to give investors a headache.
London futures are lagging other major markets, down 0.5% in a sign that investors are
growing nervous about PM Boris Johnson's talks with Brussels as he prepares to unveil his final
Brexit offer later in the day. The index's miners may also feel pressure from falling metal
prices following the U.S. data.
The U.S. car sales data will likely pressure European car makers while the latest estimates
for European companies to suffer their worst quarter in three years will also cast a pall over
the market, underscoring worries about the health of Europe Inc as the trade war, the global
manufacturing slowdown and Brexit bite.
In corporate news, Italy's Atlantia is expected to fall 2% after Reuters reported
Italian prosecutors have widened an inquiry into suspected safety breaches at subsidiaries the
toll road and airport company to include more employees and viaducts than they identified last
month.
The resignation of Tesco CEO Dave Lewis after six years may offset the
supermarket’s better-than-expected H1 results, according to dealers who see the shares down
2-3%, while German leasing company Grenke may get a lift after raising its 2019
forecasts.
Credit Suisse could get a boost after saying it expects an estimated $250 million
boost to 2020 profit from changes it is making to how it calculates risk-weighted assets and
does hedging.

Here are your early headlines:
Credit Suisse says risk calculation, hedging change to reap $250 mln
Italian prosecutors widen probe over safety of Atlantia-operated bridges - sources

Tesco CEO Dave Lewis to step down in 2020
Grenke Reports 9M New Leasing Business Of 2.1 Bln Eur
Austria's AMS faces wait to learn fate of $4.9 bln Osram bid
EDF boss pledges action on nuclear delays and cost overruns
IWG's Dixon sees rival WeWork's troubles as an opportunity
Italy's Bio-on slashes 2019 sales forecast, blames U.S. hedge fund
U.S. CFTC orders six financial institutions to pay fine for reporting failures
French spirits maker Pernod Ricard plans to cut around 280 jobs
UniCredit to sell 5 bln euros of soured home mortgages next month-sources
Norway sovereign wealth fund to divest oil explorers, keep refiners
CNH to invest 60 mln euros, cut 330 jobs in Italian plant overhaul
BRIEF-Ryanair Sept Traffic Grows 8% To 14.1 Mln Customers
BRIEF-Wizz Air Holdings Says Sept Load Factor Up By 0.5Ppts To 94.5%
BRIEF-Qinetiq To Acquire Manufacturing Techniques For $105 Mln
BRIEF-Inchcape To Sell 3 Retail Sites In Mainland China For 54 Mln Stg
BRIEF-Naked Wines Sells Lay & Wheeler Business For 11.3 Mln Stg
BRIEF-Hochschild Mining Acquires Rare Earth Deposit In Chile
BRIEF-National Grid Confirms Massachusetts DPU Issued Rate Case Order For Massachusetts
Electric Business
BRIEF-Puretech Health Announces Acquisition Of Minority Interests In Internal Pipeline
Platforms

(Josephine Mason)
*****

THE EXTENDED HANGOVER (0530 GMT) GMT)
The decade-low U.S. factory data and weak car sales are expected to drag on European stocks
again today, after suffering the worst day in nearly two months yesterday as investors fret
about the slowing global economy and shun riskier assets for safe havens.
Asian markets have taken their lead from heavy losses on Wall Street overnight.
U.S. manufacturing had been the last bright spot in the global economy, but the contraction
in the ISM manufacturing reading suggests the trade war is starting to bite in the U.S.
industrial heartland, where U.S. President Trump enjoyed huge support in the 2016 election.
"It is fair to say that the worldwide manufacturing sector is in trouble. The US-China trade
spat is having a knock-on effect around the globe, hence why we saw a sharp move lower in stocks
yesterday," says David Madden, market analyst at CMC Markets UK.
"Trade talks between the US and China will continue next week, so traders will be paying
close attention to any developments. The best dealers can hope for is a de-escalation in trade
tensions, but it is obvious that the damage has been done."
Adding to the gloomy mood will be data showing a further deterioration in Q3 earnings
forecasts for Europe.
IG financial spreadbetters expect London's FTSE to open 35 points lower at 7,325,
Frankfurt's DAX to open 15 points lower at 12,249, and Paris' CAC to open 3 points lower at
5,594.

(Josephine Mason)
*****




(Reporting by Danilo Masoni, Joice Alves, Josephine Mason, Julien Ponthus and Thyagaraju
Adinarayan)