Jan 19 - 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 LUXURY STOCKS TO THE RESCUE! (0840 GMT) Things were looking quite ugly about an hour ago when European futures were deep into the red following a rough session on Wall Street where banking stocks, courtesy of Goldman Sachs" earnings, and tech stocks got hammered. But European equity markets have avoided a sell-off so far thanks to luxury stocks which are to the old continent"s investors what FAANGS are, or were, for U.S. traders. Shares in Switzerland"s Richemont are leading the STOXX 600 and up a whopping 7% after the world"s second-largest luxury group reported string demand for jewellery and watches. That had a positive effect across the sector and France"s heavyweights, LVMH, Kering and Hermes are up and lifting the Paris CAC 40 benchmark above the floatation mark. The UK"s Burberry is another strong performer, rising close to 5% as the luxury brand said annual profit would beat market expectations. The retail sector (.SX86P) was also on a roll, rising over 2% with Spain"s Inditex leading the pack after Goldman Sachs upgraded the stock due to resilient earnings and cashflow. Marks & Spencer, Zalando (ZALG.DE) and Kingfisher (KGF.L) were all rising over 2%. The tech (.SX8P) sector is also showing signs of resilience, losing just 0.1%, a better fate than that of the Nasdaq last night. The start of the earnings season was also pretty positive for Pearson shareholders who saw the stock jump 5% after the education group raised its forecast. (Julien Ponthus) ***** GOLDMAN SACHS ADDS ANOTHER LAYER OF STRESS (0748 GMT) For all the turmoil across financial markets yesterday, the Nasdaq creeping dangerously near correction territory and closing below a key 200-day moving average probably came as the least surprising feature for investors. After all, dumping expensive tech and growth stocks when bond yields rise as the Federal Reserve embarks on an interest hike cycle is seen as basic stock market trading 101. Going overweight on banking stocks on tighter monetary policy tightens is another common trade but that one backfired spectacularly when Goldman Sachs (GS.N) missed quarterly profit expectations and plunged 7% as rising expenses bit into its fourth quarter earnings. read more Traders are now waiting for Bofa (BAC.N) and Morgan Stanley (MS.N) to update the market today and see whether the key theme of this new earnings season might just be rising costs, including pay, denting profits across all industries. With European and U.S. stock futures down over 0.5%, it"s fair to say there"s palpable uncertainty on that front as other structural forces of this tightening cycle are only gaining strength in these early days of 2022. The dollar is pumped up against rival currencies with benchmark U.S. Treasury yields trading on two-year highs as the Federal Reserve shows signs of being more aggressive in tackling inflation while in Europe, Germany"s 10-year bond yield rose above 0% for the first time since May 2019. Moreover, latest data showed British consumer price rose to 5.4% in December, its highest since March 1992, a level which might encourage the Bank of England to speed up tightening. read more Even the cautious Bank of Japan warned investors that inflation may accelerate faster than expected if raw material costs continue to spike. read more This came as oil prices are up for a fourth day to levels last seen in 2014 as an outage on a pipeline from Iraq to Turkey increased concerns about an already tight supply outlook. read more sd sd Key developments that should provide more direction to markets on Wednesday: -UK inflation rises to highest in nearly 30 years read more -German harmonised inflation +5.7% y/y in December US housing starts US 20-year treasury auction US earnings: Bofa, State Street Morgan Stanley, Proctor and Gamble, Bancorp, Alcoa