LIVE MARKETS-Before the bell: Europe near peaks, defence in demand

Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com

BEFORE THE BELL: EUROPE NEAR PEAKS, DEFENCE IN DEMAND

European shares were set to stay at record levels on Tuesday as investors pondered the prospect of debt-financed stimulus to fund higher defence spending, ahead of talks between U.S. and Russian officials over a possible Ukraine peace deal.

After scoring a new record close the day before , boosted by a powerful rally in arms stocks, European futures pointed to a steady start. Tradegate indications showed defence stocks remained in demand and could extend their rally even further.

Rheinmetall RHMG.DE, Renk R3NK.DE, Hensoldt HAGG.DE, Thyssenkrupp TKAG.DE were the top four most executed orders on the German platform, with their shares rising 5-8%. DAX futures rose 0.25% while EuroSTOXX50 contracts were broadly steady.

FTSE futures were up around 0.1%, broadly steady after data showed that British wages rose by an annual 5.9% in the last three months of 2024, helping sterling pare some of its losses.

Traders will be keeping an eye on Wall Street, as US investors return from a public holiday. Nasdaq futures rose 0.5%.

Meanwhile, this month's BofA fund manager survey showed bullish investors cut cash levels to 15-year lows, as they rotated into bond-sensitive sectors and to Europe, while 89% of those surveyed said U.S. stocks are overvalued.

In corporate news, earnings kept flowing in.

French IT consulting firm Capgemini CAPP.PA reported a 2% drop in sales, narrowly beating market expectations, helped by sustained demand for its cloud and AI services.

Holiday Inn owner IHG IHG.L reported 3% growth in its annual room revenue on Tuesday, above market expectations.

(Danilo Masoni)

EARLIER ON LIVE MARKETS:

ARMS STOCKS SOAR AHEAD OF UKRAINE PEACE TALKS CLICK HERE