Markets Dawn Europe: Fri 19 Jul
Podcast 🎧 Charts 📊 Script 📄
Morning,
Markets Dawn Europe will be shorter than usual today.
It was another poor day for risk assets mainly in the US, with technology stocks accelerating the sell-off and European indices declining marginally but for a fourth straight session. The Dow Jones Industrials fell 1.3% from its record high and the S&P 500 eased 0.8% with banking and healthcare stocks leading the fall.
On the earnings front, Netflix, TSMC, Novartis and Volvo all beat revenue and earnings estimates yesterday but Novartis (mcap $235bn) dropped 4% despite raising its full-year profit estimate.
Interest rate markets continue to trade sideways in the US and the UK but moved lower again in the €-zone, with benchmark sovereign yields ending little changed while the $ recovered partially from its recent weakness.
The ECB maintained all its monetary policy rates unchanged as widely anticipated with the deposit rate at 3.75% and refinancing rate at 4.25%. The central bank left the door wide open for a rate cut at its next meeting in September and remains data-dependent. President Lagarde stated that the ECB will maintain rates at the current restrictive level for as long as it takes to get inflation down to target. Traders reduced their expectations for a cut in September from 73% to 66% following her remarks.
In a split decision, South Africa´s central bank also kept its benchmark repo rate steady at 8.25% as inflation (5.2% YoY) remains above its 4.5% mid-point target.
-Biden is facing increasing pressure to drop his re-election candidacy as senior Democrats including Obama and Pelosi express their concerns that his chances of winning are decreasing rapidly.
-Trump made his first speech following Saturday´s incident at the Republican National Convention.
-Media sources are reporting that Meta Platforms is considering acquiring a minority stake in eyewear giant EssilorLuxottica as it aims to expand its smart glasses division. Meta shares advanced 3%. Essilor advanced just 1.5% following a steep fall on Wednesday.
Asian markets are selling off today with stock indices in Hong Kong, Taiwan, Korea and Australia lower between 1 and 2%. Brent oil is down by 0.5% below $85 and Bitcoin is flat at $64,000.
There were no significant credit rating changes or new €urobond issues worth highlighting.
In new listings, Chilean Latam Airlines (mcap $8.5bn) is planning to list ADRs on the NYSE.
Today´s data releases will be PPI inflation in Germany and Canada and retail sales in the UK and Canada. Companies reporting earnings include Danske Bank, Amex, Schlumberger and Travelers. It will be the busiest day of the week for Fed speeches with Daly, Bowman, Williams and Bostic attending conferences.
That’s all for today, have a nice weekend.
Copyright © 2024 Laconic. All rights reserved. This publication, 'Markets Dawn Europe,' contains proprietary content and is intended solely for the recipient's personal use. Disclaimer: Our service is for informational purposes only and does not constitute personal financial advice.