European Stock Futures Steady; HSBC Results Impress

European stock markets are expected to open in a steady manner Monday, with investors weighing strong results from banking giant HSBC as well as China’s latest Covid-19 outbreak.

At 2:10 AM ET (0610 GMT), the DAX futures contract in Germany traded 0.1% lower, while CAC 40 futures in France climbed 0.2% and the FTSE 100 futures contract in the U.K. rose 0.1%.

HSBC (LON: HSBA), one of the largest banks in Europe, beat expectations with a 74% rise in third-quarter profit, posting a pretax profit of $5.4 billion versus $3.1 billion a year earlier, helped by the release of cash set aside for expected bad loans that have not materialized. It also announced a share buyback of up to $2 billion but said it wouldn’t restore its dividend yet.

Also helping the tone in Europe were gains in China Evergrande Group (HK:3333) stock in Asia after the embattled property developer averted a costly default last week with a last-minute bond coupon payment. The group also moved Monday to prioritize the growth of its electric vehicles business over its troubled core real estate operations.

That said, there are also worries that an increase in Covid-19 cases in China, one of the globe’s main growth drivers, will hit global demand.

China warned Monday that new infections will increase in the coming days after the latest outbreak expanded to 11 provinces, prompting the locking down of Ejin, a county in northwestern Inner Mongolia that has seen the most Covid-19 cases. China is one of the few countries still adopting a ‘zero tolerance’ attitude toward Covid, preferring economically costly lockdowns to accept that the disease will become endemic.

The FTSE MIB climbed up by 0.18% to 26,571.20. In the cash markets, the DAX  Germany was trading up 0.46%  to 15,542.65. CAC 40  in France rose by 0.71% to 6,733.37 while the FTSE 100  in the U.K. were up by 0.20% to 7,204.35. , at the time of writing.

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