LIVE MARKETS-Before the bell: European futures down, MS upgrades banks

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BEFORE THE BELL: EUROPEAN FUTURES DOWN, MS UPGRADES BANKS

European shares were set for weaker start on Wednesday on fresh geopolitical concerns after new U.S. intelligence reportedly suggested Israel is making preparations to strike Iranian nuclear facilities.

That boosted crude oil prices by more than 1% in Asian hours and supported safe havens, while 10-year U.S. Treasury yields edged above 4.5%, amid lingering concerns over the sustainability of the country's deficits, which also kept risk appetite in check.

EuroSTOXX50, DAX and FTSE futures were lacking a clear direction, last down 0.3%, while U.S. contacts pointed to slightly larger losses on Wall Street later on. Nasdaq and S&P 500 futures fell around 0.6%.

Eyes remained on banks .SX7P, the best sectoral performer in Europe this year, up over 31%, after Morgan Stanley upgraded its view to attractive, citing receding risks to growth and conviction of continued steepening of yield curves.

Infineon IFXGn.DE was one to watch too, after a deal with Nvidia on developing chips for new power delivery systems inside artificial intelligence data centres. Infineon shares rose over 2% in early Frankfurt trading.

A hot UK inflation number, which disappointed finance minister Rachel Reeves, could weigh on rate-sensitive utilities in London.

Elsewhere, earnings still dominated corporate news, with numbers out from firms including retailers M&S MKS.L, JD Sports JD.L and Currys CURY.L in the UK. Julius Baer BAER.S flagged a $156 million charge after a review of its credit portfolio.

(Danilo Masoni)

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