EUROPEAN CLOSING REPORT: FRIDAY – 9TH – NOVEMBER – 2018
EUROPEAN CLOSING REPORT
FRIDAY – 9TH – NOVEMBER – 2018
European cash equity markets are broadly lower at the closing bell although have picked up off their worst levels in the latter stages of the session (FTSE -0.5%, DAX 0.0%, CAC -0.5%). Basic resource are the worst
performers, led lower by Thyssenkrupp after the German steel maker cut their full-year profit outlook. UBS have led losses in the banking sector amid a DoJ probe while oil stocks have been dragged lower by heavy losses in the oil markets – US crude futures
lost over two-percent at the earlier lows before recovering. We also saw a lower open on Wall Street where the tech-heavy NASDAQ has led declines although DJIA Walt Disney has jumped over two-percent post earnings. In the bond markets, US government bond yields
have extended earlier losses although did see a brief uptick after stronger-than-expected US producer price data was released – headline PPI rose +0.6% MoM, its largest increase in six years. Michigan Sentiment also surprised to the upside at 98.3 (f/c. 98.0)
which has helped the Dollar Index remain in positive territory albeit off its best levels. Elsewhere in FX, the Japanese Yen remains the G10 outperformer on safe-haven demand while the Norwegian Krone is the weakest following soft CPI data released earlier
today. Still to come today, the US Baker Hughes rig count at 18:00 BST.
* US Corporate News:
- Walt Disney (+3.0%): Q4 EPS $1.48 versus $1.33 expected | Q4 Revenue $14.30 Bln versus $13.70 Bln expected
- General Electric (-10.3%): JPMorgan cut their price target to $6.00
* Irish PM Varadkar said a Brexit deal is possible in the next few weeks.
* Islamic State has claimed responsibility for the knife attack in Melbourne that left one person dead.
* US Producer Price Data (Oct):
- PPI M/M +0.6% versus +0.2% expected, previous +0.2%
- PPI Y/Y +2.9% versus +2.5% expected, previous +2.6%
- Core PPI M/M +0.5% versus +0.2% expected, previous +0.2%
- Core PPI Y/Y +2.6% versus +2.3% expected, previous +2.5%
* New York Fed President Williams said sustainable economic growth depends on a healthy job market.
* Euro Group President Centeno said sanctions against Italy are not on the Euro Group agenda right now.
* German Foreign Minister Mass said he is optimistic on a Brexi deal and is confident the UK will leave with an agreement.
* PBOC said the Chinese economy is under increasing downward pressure.
* US President Trump has signed a proclamation taking effect tomorrow that suspends the entry of migrants through the US Southern border between ports of entry for ninety-days.
* Fed Governor Quarles announced the stress capital buffer will not start until at least 2020.
* Michigan Sentiment (Nov P) 98.3 versus 98.0 expected, previous 98.6
- Current Conditions 113.2 versus 114.4 expected, previous 113.1
- Expectations 98.3 versus 98.0 expected, previous 89.3
- One Year Inflation +2.8%, previous +2.9%
- Five Year Inflation +2.6%, previous +2.4%
* US Business Inventories M/M (Sep) +0.4% versus +0.3% expected, previous +0.3%
* UK Junior Transport Minister Johnson has resigned from government citing Brexit.