INDICES
Yesterday, European stocks saw another session of beefy gains, with the Stoxx Europe 600 Index surging 2.5%. Germany’s DAX 30 jumped 3.9%, the U.K.’s FTSE 100 rose 2.6% and France’s CAC 40 gained 3.4%.
EUROPE ADVANCE/DECLINE
88% of STOXX 600 constituents traded higher yesterday.
93% of the shares trade above their 20D MA vs 93% Tuesday (above the 20D moving average).
46% of the shares trade above their 200D MA vs 38% Tuesday (above the 20D moving average).
The Euro Stoxx 50 Volatility index eased 1.07pt to 29.61, a new 52w high.
SECTORS vs STOXX 600
3mths relative high: Autos
3mths relative low: none
Europe Best 3 sectors
insurance, automobiles & parts, banks
Europe worst 3 sectors
health care, telecommunications, food & beverage
INTEREST RATE
The 10yr Bund yield fell 1bp to -0.42% (above its 20D MA). The 2yr-10yr yield spread fell 4bps to -28bps (below its 20D MA).
ECONOMIC DATA
EC 08:30: May Construction PMI, exp.: 15.1
FR 08:30: May Construction PMI, exp.: 3.8
GE 08:30: May Construction PMI, exp.: 31.9
UK 09:00: May New Car Sales YoY, exp.: -97.3%
UK 09:30: May Construction PMI, exp.: 8.2
EC 10:00: Apr Retail Sales MoM, exp.: -11.2%
EC 10:00: Apr Retail Sales YoY, exp.: -9.2%
FR 10:00: 10-Year OAT auction, exp.: 0.03%
FR 10:00: Apr Retail Sales MoM, exp.: -17.4%
FR 10:00: Apr Retail Sales YoY, exp.: -16%
EC 12:45: ECB Interest Rate Decision, exp.: 0%
EC 12:45: Marginal Lending Rate, exp.: 0.25%
EC 12:45: Deposit Facility Rate, exp.: -0.5%
EC 13:30: ECB Press Conference
UK 00:01: May Gfk Consumer Confidence final, exp.: -33
MORNING TRADING
In Asian trading hours, EUR/USD eased to 1.1218 and GBP/USD fell to 1.2540. USD/JPY was little changed at 108.90. AUD/USD extended its rally to 0.6937. This morning, official data showed that Australia’s retail sales dropped 17.7% on month in April (-17.9% expected), while trade surplus totaled 8.8 billion Australian dollars (7.5 billion Australian dollars expected).
Spot gold rebounded to $1,703 an ounce.
#UK – IRELAND#
Avast, GVC Holdings, Kingfisher and HomeServe will replace EasyJet, Meggitt, Centrica and Carnival in the FTSE 100 Index with effect from June 22, according to FTSE Russell.
IG Group, a financial derivatives trading services provider, posted a 4Q trading update: “The Group issued a Q4 trading update on 24 April 2020 which noted that quarter to date net trading revenue was estimated to be around £173 million. Financial market volatility has remained elevated and the Group has continued to see high levels of client trading activity. Net trading revenue in Q4 FY20 is now estimated to be approximately £259 million (Q4 FY19: £117.9 million), with full year net trading revenue anticipated to be approximately £649 million (FY19: £476.9 million).”
Wizz Air, a low-cost airline company, reported that passenger number plunged 96.4% on year to 126,549 in May and the load factor dropped to 61.1% from 93.9% in the prior-year period. Meanwhile, the company was downgraded to “hold” from “buy” at HSBC.
Smith & Nephew, a medical equipment manufacturer, was upgraded to “overweight” from “equalweight” at Morgan Stanley.
Electrocomponents, an industrial and electronics products distributor, was downgraded to “neutral” from “overweight” at JPMorgan. From a chartist point of view, the share is trading within a consolidation channel (bullish continuation pattern) shaped between 400 & 720p. A weekly push above 720 would trigger a new measured move up towards 1000p.
#GERMANY#
Bayer, a pharmaceutical group, is prohibited from selling its dicamba-based herbicide in the U.S., as the U.S. Court of Appeals for the Ninth Circuit overturned the Environmental Protection Agency’s approval of the product.
#FRANCE#
Airbus, an aircraft manufacturer, may keep its underlying jet production at 40% below pre-pandemic plans for two years, reported Reuters citing people familiar with the matter.
Michelin, a tyre manufacturer, was upgraded to “buy” from “neutral” at Citigroup.
#SWITZERLAND#
Novartis, a pharmaceutical group, said a phase 3 trail of its Cosentyx, which helps patients realize early and lasting relief in axial spondyloarthritis, met the primary and secondary endpoints.
#SCANDINAVIA#
Kone, an engineering company, was downgraded to “underperform” from “neutral” at Bank of America Merrill Lynch.
EX-DIVIDEND
Swiss Life: SF5
