(ABM FN-Dow Jones) European stock markets are heading for a lower opening on Tuesday, after a pullback in American futures and red rates in Asia.
IG predicts an opening loss of 24 points for the German DAX and a minus of 27 points for the French CAC 40. The British FTSE looks set to open 10 points lower.
The stock markets in Europe also ended mainly lower on Monday. Market analyst Michael Hewson of CMC Markets called it “a moment of reflection” for European stock markets after last week’s strong gains. Bond yields also rose again on Monday.
Meanwhile, investors were concerned about the eurozone economy. In October, the services sector in the currency union shrank more than in the previous month and the index level of 47.8 was the lowest in 32 months.
Another blow, judged economist Cyrus de la Rubia of Hamburg Commercial Bank.
“Not a rosy picture,” the economist added. However, expectations for the next 12 months have improved slightly, “but they remain well below the long-term average.”
Last week it was announced that industry in the eurozone also shrank faster in October.
On a macroeconomic level, further attention was paid to German factory orders. These rose unexpectedly in September, where a decline of 1.5 percent was expected.
Siemens led in Frankfurt on Monday with a plus of around one percent. Vonovia, a strong climber last week, had a difficult day and ended up at the bottom of the DAX, with a loss of more than 5 percent. Siemens Energy, also a riser in Frankfurt last week, fell about one and a half percent on Monday.
Payment company Adyen lost more than 3 percent in Amsterdam in the run-up to an update next Wednesday. Sector peer Worldline lost more than 4 percent in Paris.
LVMH acquires American eyewear manufacturer Barton Perreira. The French luxury brand announced this. LVMH shares fell slightly less than one percent in the CAC 40. Real estate company Unibail-Rodamco-Westfield, like sector peer Vonovia, suffered considerably.
Defense specialist Thales, like German rival Rheinmetall, did good business and led the French stock market with a plus of more than one percent. Rheinmetall rose more than half a percent in the DAX.
Ryanair will pay a dividend of 400 million euros, after strong profit growth in the past six months. Ryanair shares rose 8 percent in London. Sector peer easyJet won more than one percent.
Postal shares were struggling after a disappointing quarterly update from PostNL. The share fell almost 13 percent in Amsterdam and Bpost fell almost 2 percent in Brussels. Deutsche Post lost one and a half percent in Frankfurt.
Telecom Italia has accepted KKR’s bid of more than $20 billion for its fixed-line network. This should bring the Italian telecom company’s debt back within manageable proportions. The share fell more than 3 percent.
Oil was on the rise, and with it oil stocks. In Amsterdam, Shell gained just under one percent and in Paris TotalEnergies rose half a percent.
Euro STOXX 50 4,159.19 (-0.4%)
STOXX Europe 600 443.52 (-0.2%)
DAX 15,135.97 (-0.4%)
CAC 40 7,013.73 (-0.5%)
FTSE 100 7,417.76 (+0.00%)
SMI 10,576.75 (-0.03%)
AEX 735.34 (-0.1%)
BEL 20 3,474.01 (-0.8%)
FTSE MIB 28,592.60 (-0.3%)
IBEX 35 9,241.50 (-0.6%)
Wall Street will open lower on Tuesday.
The American stock markets ended slightly higher on Monday.
Last week, the major indexes gained significant ground in New York, while bond yields fell. The US ten-year yield was quoted at 4.50 percent on Friday and rose to 4.65 percent on Monday. That is still well below the peak of more than 5.00 percent a few weeks ago.
Investors seem convinced that the Federal Reserve is done raising interest rates.
“The upcoming inflation data later this month will be key as it could completely rule out the possibility of another rate hike,” analysts at SPI Asset Management said.
According to market strategist Frank Vranken of Edmond de Rothschild Europe, expectations of interest rate cuts are growing. “And if the Fed’s policy outlook eases, so will the dollar,” the market expert said.
WTI oil rose slightly on Monday in response to news that Saudi Arabia and Russia will continue their production cuts until at least the end of the year. Last week, oil prices fell about 5 percent.
Berkshire Hathaway saw its net result deteriorate in the third quarter, but performed better operationally and saw its cash flow filled even further. The net loss increased year-over-year from negative $2.8 billion to a loss of $12.8 billion. Last year, Berkshire suffered a loss on its investments of $10.5 billion. Last quarter this was even a loss of 23.5 billion dollars. Buffett himself believes that the operating result is a better reflection of how his company is performing than the net result, which includes the ‘paper’ profits and losses, and that was therefore on the rise to 10.8 billion dollars. Berkshire shares closed about one and a half percent lower on Monday.
BioNTech warned on Monday that revenues from corona vaccines this year will be considerably lower than previously expected and also announced that it will spend less. The BioNTech share rose more than 4 percent, because a profit was booked last quarter, while analysts had expected red figures.
Citigroup is said to be planning to lay off at least 10 percent of its workforce in some departments as part of a previously announced restructuring led by CEO Jane Fraser, CNBC reported Monday. The stock fell half a percent.
Meanwhile, the earnings season has passed its peak and results are largely better than expected. With 81 percent of S&P 500 companies reporting results, 82 percent of them delivered a positive earnings per share surprise and 62 percent delivered a positive revenue surprise, according to data firm FactSet.
S&P 500 index 4,365.98 (+0.2%)
Dow Jones index 34,095.86 (+0.1%)
Nasdaq Composite 13,518.78 (+0.3%)
The Asian stock markets were in the red. Chinese exports also appeared to have fallen in October.
Nikkei 225 32,298.30 (-1.3%)
Shanghai Composite 3,054.01 (-0.1%)
Hang Seng 17,715.01 (-1.4%)
The euro/dollar was trading at 1.0709 this morning. On Monday evening the currency pair was trading at 1.0723.
USD/JPY Yen 150.28
EUR/USD Euro 1.0709
EUR/JPY Yen 160.93
04:00 Trade balance – October (Chi)
06:30 Inflation – October (NL)
06:30 Reserve Bank of Australia – Interest rate decision (Aus)
08:00 Industrial production – September (Germany)
11:00 Producer prices – September (eur)
14:30 Trade balance – September (US)
9:00 PM Consumer Credit – September (US)
00:00 KPN – Investors Day
07:00 Deutsche Post – Third quarter figures (Germany)
07:00 UBS – Third quarter figures (Zwi)
13:00 BioNTech – Third quarter figures (Dld)
1:00 PM Uber – Third quarter figures (US)
Source: ABM Financial News
ABM Financial News is a supplier of stock market news, video and data, both for real-time trading platforms and dealing rooms and for online and offline media publications. The information in this article is not intended as professional investment advice or as a recommendation to make certain investments.
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