Stocks, data, earnings and news

Consumer confidence in the eurozone increased in February, according to a flash estimate released by the European Commission. Confidence rose 1.7 points compared to January, to -19.0.

The estimate matched Reuters analysts’ expectations.

While consumer confidence has now improved for four consecutive months, it is still well below its long-term average, according to the commission.

– Hannah Ward Glinton

Cybersecurity firm Darktrace said Monday it has hired audit firm EY to review “key financial processes and controls” in a bid to allay investor fears after a short seller accused the firm of manipulating its accounts.

“The Board fully believes in the robustness of Darktrace’s financial processes and controls. As a sign of that confidence, we commissioned this independent, third-party audit by E&Y,” Jeffrey Hearst, Chairman of the Board, said in a statement. “We look forward to the outcome of this review.”

Darktrace said EY will report to Darktrace’s Chairman of the Audit and Risk Committee, Paul Harrison.

Read the full story here.

Mobile communications equipment maker Ericsson plans to cut 1,400 jobs in Sweden, in line with a previously announced cost-cutting strategy.

“We intend to deal with employee cuts through a volunteer program,” a company spokesperson told CNBC in an emailed statement, adding that the company has completed employee reduction negotiations with Swedish unions. “Managers will share how each unit has been affected with their staff in the coming days.”

The company employs 14,500 people across R&D, sales, production and management units.

“The cost savings cover various areas such as reducing consultants, streamlining operations, and reducing facilities,” the spokesperson said.

The layoffs come as Ericsson seeks to cut costs by SEK 9 billion ($869 million) by the end of this year, with 70% in cost of goods sold and 30% in selling, general and administrative expenses. And you expect to see the benefits of this initiative starting in the second quarter, according to the company View fourth quarter earnings.

Tech giants like Microsoft, Google and Amazon have announced a series of substantial layoffs in recent weeks, as recession fears threaten to hit consumer demand.

Ericsson shares were down 0.28% at 11 a.m. London time.

– Ruxandra Iordach

Production in the construction sector fell by 2.5% in the Eurozone and by 2% in the EU month-on-month in December.

Figures published by Eurostat on Monday revealed setbacks that followed a 0.1% decline in the eurozone and an increase in the European Union by 0.1% in November.

The country breakdown showed that the largest declines were in Germany, down 8% for the month, followed by Austria, down 7.6%, and Poland, down 3.8%.

Higher borrowing costs and continued input cost inflation weighed on the sector even as the general outlook for the Eurozone economy improved, with many now predicting that the bloc would avoid recession.

– Jenny Reed

There’s a lot of opportunity in stock growth — but if you get it wrong, “you’ll get thrown out,” says Haig Bathgate, head of investments at Atomos.

Figures published on Monday showed that more than two-thirds of adults in the UK are cutting their spending on non-essential things in light of cost pressures.

A survey by the Office for National Statistics found that 94% of people said their cost of living was higher than it was a year ago. When asked how they respond to this, 69% said they spend less on non-essential items and 60% use less gas and electricity in their homes.

The Office for National Statistics said 55% of renters would not be able to afford an unexpected £850 ($1,022) expense, compared with 12% of homeowners. While adults ages 25-34 are more likely to experience some form of financial vulnerability, 34% borrow more money or use more credit than last year.

The pace of inflation in the UK has been declining but is still above 10%.

– Jenny Reed

Bob Parker, senior advisor at the International Capital Markets Association, says he “wouldn’t be surprised at all if we saw incremental upward revisions in growth in the US.”

European stock movements were muted in early trading on Monday.

French auto parts maker Faurecia was the best performer, rising 4.7% after announcing Sunday that it would sell its SAS Cockpit Modules arm for 540 million euros ($577.5 million) in order to focus on its “core activities”.

At the bottom of the Stoxx index, British packaging company DS Smith fell 3.5%.

– Jenny Reed

European markets were cautiously higher in early trade, with the Stoxx 600 up 0.25% and most sectors higher in the green.

Mining stocks jumped 1% and utilities added 0.7%, while household goods slipped 0.3%.

France’s CAC 40 and Germany’s DAX posted slight gains, while the FTSE was flat in the previous session.

European markets were on course to open higher on Monday, suggesting that last week’s bullish momentum is back on track.

IG data showed that the FTSE 100 was on track to open 26 points higher at 8,022 points, after closing above 8,000 for the first time on Thursday.

The French CAC 40 index rose 29.5 points at 7374 points, the Italian MIB index rose 62.5 points at 27911.5, and the German DAX index rose 59 points at 15535.9.

– Jenny Reed

Investment bank Goldman Sachs says the boom in clean hydrogen is accelerating.

“The clean hydrogen revolution continues to accelerate,” analysts at the bank said in a note dated February 13. “We have reflected this in our hydrogen outlook, nearly tripling the base case scenario to 2030, versus our preliminary estimates for last year (February 4, 2022).”

The bank cited some of the factors driving clean hydrogen, including positive regulations gaining pace with the US Inflation Reduction Act (IRA) in the foreground, and new initiatives to create a global seaborne market (hydrogen in liquid form can be transported by ships).

Professional subscribers can read more here.

– Wizen tan

Stock markets seem to have turned the tide after a dismal 2022.

But with the path of higher interest rates still uncertain, and a possible recession still likely, market watchers are having a hard time determining whether this is the ascent of another bear market or the start of a new bull market.

“There are two fundamental stories in the market today,” Rahul Ghosh, a portfolio specialist in the equity division of T. Rowe Price, told CNBC.

“optimist [one] is the story of deinflation…and a little more negative [one] It is a story of viscous inflation, which will then have implications for either the path of higher interest rates or the length of time rates stay higher.”

In this environment, Ghosh said investors should look to be “almost defensively offensive.”

Professional subscribers can read more here.

– Xavier Ong