Yesterday, European stocks also ended in the red. The Stoxx Europe 600 Index eased 0.47%. Germany's DAX 30 slipped 0.43%, France's CAC 40 dropped 0.46%, and the U.K.'s FTSE 100 was down 0.67%.
58% of STOXX 600 constituents traded lower or unchanged yesterday.
71% of the shares trade above their 20D MA vs 75% Wednesday (above the 20D moving average).
48% of the shares trade above their 200D MA vs 50% Wednesday (above the 20D moving average).
The Euro Stoxx 50 Volatility index eased 0.77pt to 26.81, a new 52w high.
SECTORS vs STOXX 600
3mths relative high: Chemicals, Construction
3mths relative low: Pers. & House. Goods, Real Estate
Europe Best 3 sectors
utilities, construction & materials, telecommunications
Europe worst 3 sectors
travel & leisure, personal & household goods, real estate
The 10yr Bund yield was unchanged to -0.44% (below its 20D MA). The 2yr-10yr yield spread rose 1bp to -22bps (above its 20D MA).
EC 09:30: ECB Guindos speech
EC 09:30: ECB Schnabel speech
EC 10:00: Jun Inflation Rate MoM final, exp.: -0.1%
EC 10:00: Jun Core Inflation Rate YoY final, exp.: 0.9%
EC 10:00: Jun Inflation Rate YoY final, exp.: 0.1%
EC 10:00: May Construction Output YoY, exp.: -28.4%
In Asian trading hours, EUR/USD was flat at 1.1385 while GBP/USD rebounded to 1.2569. USD/JPY held gains at 107.25.
Spot gold edged up to $1,798 an ounce.
#UK - IRELAND#
Rio Tinto, a giant mining group, published 2Q production results: "Overall, we achieved a robust production performance with volumes up 1% compared with the second quarter of 2019 on a copper equivalent basis. (...) Pilbara iron ore shipments of 86.7 million tonnes (100% basis) were 1% higher than the second quarter of 2019. (...) Bauxite production of 14.6 million tonnes, 9% higher than the second quarter of 2019. (...) Aluminium production of 0.8 million tonnes in the second quarter was 2% lower than the second quarter of 2019. (...) Second quarter mined copper was 3% lower than the same period of 2019. (...) Capital expenditure is expected to be around $6 billion in 2020 (previously $5 to $6 billion) due to an appreciation in our major operating currencies against the US dollar since the first quarter and a reduced impact of COVID-19 on both sustaining and development expenditure. Capital expenditure for 2021 and 2022 is expected to be around $7 billion per year (previously $6.5 billion)." From a daily point of view, the share remains on the upside supported by a rising trendline since the end of March and just escaped from a consolidation area. Above 4428p look for the horizontale resistance of the July 2019 at 5039p and 5250p in extension.
Source: GAIN Capital, TradingView
DCC Plc, a sales and marketing services group, issued a 1Q trading statement: "Since DCC's last trading update on 19 May 2020, which covered the first six weeks of the year ending 31 March 2021, the trading performance of the Group has continued to improve in the seasonally less significant first quarter. Trading for the first quarter was resilient and ahead of the Group's expectations at the time of the last update, although behind the prior year due to the severe lockdown restrictions in place during April and May."
HomeServe, a home repairs and improvements company, released a trading update for the period from April 1 to July 16: "In HomeServe's Membership businesses, policy renewal and mid-term cancellation rates have continued in line with historic trends in this traditionally quieter period, with no impact from the COVID-19 pandemic. (...) In Home Experts, consumer demand for home improvements has recovered strongly across all businesses. (...) HomeServe continues to expect to deliver a solid performance in FY21."
Erste Group Bank, an Austrian bank, was downgraded to "hold" from "buy" at Deutsche Bank.
Vinci, a concessions and construction company, said 2.4 million passengers were handled at its airports network in 2Q, down 96.4% on year, and passenger numbers were down 61.4% to 47.7 million in 1H, "due to the global travel restrictions imposed to limit the spread of Covid-19".
Heineken, a Dutch brewing company, was downgraded to "equalweight" from "overweight" at Barclays.
#SCANDINAVIA - DENMARK#
Nordea Bank, a financial services group, announced that 2Q net income sank 64.3% on year to 243 million euros, as net loan losses jumped to 698 million euros from 61 million euros in the prior-year period. Also, operating income fell 2.3% to 2.09 billion euros on net interest income of 1.09 billion euros, up 1.9%.
Swedbank, a Nordic-Baltic banking group, posted 2Q net income slid 9% on year to 4.85 billion Swedish krona, but compared with a 1Q net loss of 1.69 billion Swedish krona, citing lower investigation related expenses and provisions for expected credit impairments related to the effects of Covid-19. Also, net interest income grew 4% on year to 6.89 billion Swedish krona.
Danske Bank, a Danish bank, reported that 2Q net income declined 42.5% on year to 2.33 billion Danish krone and loan impairment charges surged to 1.10 billion Danish krone from 0.22 billion Danish krone in the prior-year period. Meanwhile, net interest income rose 8.5% to 5.72 billion Danish krone. The bank added: "Our credit quality remains strong, and we expect to have taken most of the impairments needed for the full year."
Volvo, a Swedish vehicle manufacturer, announced a 2Q LPS of 0.14 Swedish krona from an EPS of 5.47 Swedish krona in the prior-year period and adjusted operating income plunged 78% on year to 3.27 billion Swedish krona, citing "severe impact from COVID-19-related effects". Meanwhile, net sales dropped 39% to 73.2 billion Swedish krona, down 38% adjusted for currency movements.
Ericsson, a Swedish networking and telecommunications company, reported that 2Q net income increased 40% on year to 2.6 billion Swedish krona and operating income grew 3% to 3.9 Swedish krona on net sales of 55.6 billion Swedish krona, up 1% (were flat after adjusting for comparable units and currency). The company added: "While the effects of Covid-19 create uncertainties, with current visibility Ericsson sees no reason to adjust 2020 and 2022 full-year targets for the Group."
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