Markets Dawn Europe: Tue 9 by 7AM UKT (8AM CET)
Brief Podcast + Data + Script
Podcast ↑↑↑↑ Scroll down for the script.
Good morning,
Wall Street ended flat ahead of tomorrow's crucial inflation update with the solar eclipse attracting more attention than the stock market. Single stock movers include Tesla gaining 5% after Elon Musk anticipated the launch of a self-driving Robotaxi, and crypto exchange Coinbase Global up 7% on the back of Bitcoin’s strength.
In rates markets, traders are increasingly reducing their expectations for multiple Fed rate cuts this year. The main drivers are the latest labour data and officials’ hawkish remarks. Benchmark yields shifted higher yesterday.
European stocks started the week on a positive note driven by strong German data and investor morale within the Eurozone. The Stoxx 600 added 0.5% yesterday, with almost every European benchmark shifting upwards by the same amount. Germany’s industrial production surprised with a strong 2.1% expansion in February, mainly on a recovery for the construction sector, and the Euro-block Sentix index hit a 2-year high at -5.9 points.
Basic resources was yesterday’s best sector in Europe, with a 2% gain as copper reached a 15-month high of $9,480. Miners Rio Tinto and Anglo American advanced between 3 and 4%.
Asian markets are trading firmer today with Taiwan up by 2%. Chinese mainland stocks are marginally lower. Brent recovered the 90 dollar level, Bitcoin is above 71,000 and European equity futures are a touch lower this morning.
In monetary policy updates, the Bank of Israel surprised analysts by leaving rates unchanged at 4.5% versus expectations for a cut.
Headlines,
Taiwan’s TSMC, the world's largest chipmaker, will build its second plant in Arizona to manufacture cutting-edge semiconductors in 2028. It is taking advantage of the 2022 Chips Act which provides subsidies to bring manufacturing back to US soil. TSMC also announced a third plant construction in US territory, increasing its investment to $65bn. Shares in TSMC are rallying more than 4% today, taking the total value of the company to $660bn, equal to 30% of Nvidia’s market cap.
JP Morgan CEO Jamie Dimon said in its letter to shareholders that US inflation and interest rates could remain high for longer, due to the increased government deficit spending. He also warned of an escalation in global geopolitical tensions and highlighted that the consequences of artificial intelligence will be extraordinary.
US Treasury Secretary Janet Yellen made positive remarks about relations between Washington and Beijing after her six-day visit to China.
In corporate deals, Blackstone is acquiring Apartment Income, a US Residential REIT for an enterprise value of $10bn in cash. Apartment Income’s shares rallied 22% to a market value of $4.5bn. The consideration is at a 25% premium.
Swedish private equity firm EQT is buying a majority stake in Universidad Europea, a privately held Spanish higher education group, at a €2bn valuation.
French media giant Vivendi is acquiring the 63% of South Africa’s broadcaster Multichoice, that it still does not own, for €1.75bn.
Barcelona-based beauty group Puig, plans to list on the Madrid exchange at an estimated valuation of €9bn during Q2. It joins Italian footwear Golden Goose, which also plans a large IPO this quarter.
There are no significant data releases scheduled for today. Tomorrow, several inflation updates are expected including CPI in the US.
That’s all for today.