Market News & Analysis
EU indices slightly down this morning | TA focus on Ocado Group
Philippe Delabarre May 6, 2020 5:30 PM
Yesterday, European stocks rebounded, with the Stoxx Europe 600 Index gaining 2.2%. Germany's DAX 30 rebounded 2.5%, France's CAC 40 climbed 2.4%, and the U.K.'s FTSE 100 was up 1.7%.
80% of STOXX 600 constituents traded higher yesterday.
69% of the shares trade above their 20D MA vs 55% Monday (below the 20D moving average).
22% of the shares trade above their 200D MA vs 20% Monday (above the 20D moving average).
The Euro Stoxx 50 Volatility index eased 3.82pts to 34.51, a new 52w high.
SECTORS vs STOXX 600
3mths relative high: none
3mths relative low: none
Europe Best 3 sectors
energy, financial services, automobiles & parts
Europe worst 3 sectors
food & beverage, retail, personal & household goods
The 10yr Bund yield rose 2bps to -0.56% (below its 20D MA). The 2yr-10yr yield spread fell 3bps to -21bps (above its 20D MA).
GE 07:00: Mar Factory Orders MoM, exp.: -1.4%
FR 08:50: Apr Markit Services PMI final, exp.: 27.4
FR 08:50: Apr Markit Composite PMI final, exp.: 28.9
GE 08:55: Apr Markit Services PMI final, exp.: 31.7
GE 08:55: Apr Markit Composite PMI final, exp.: 35
EC 09:00: Apr Markit Services PMI final, exp.: 26.4
EC 09:00: Apr Markit Composite PMI final, exp.: 29.7
UK 09:30: Apr Construction PMI, exp.: 39.3
EC 10:00: Mar Retail Sales YoY, exp.: 3%
EC 10:00: Mar Retail Sales MoM, exp.: 0.9%
FR 10:00: Mar Retail Sales MoM, exp.: 1.1%
FR 10:00: Mar Retail Sales YoY, exp.: 3.4%
GE 10:40: 5-Year Bobl auction, exp.: -0.66%
In Asian trading hours, EUR/USD remained subdued at 1.0839 while GBP/USD was flat at 1.2439. USD/JPY slid further to 106.30.
Spot gold held above $1,700 an ounce.
#UK - IRELAND#
Ocado Group, an online grocery retailer, posted a trading update: "Growth in Retail Revenue in the Second Quarter to date is 40.4% up on last year, compared to 10.3% growth in the First Quarter. The number of items per basket appears to have passed its peak but remains high, as more normal shopping behaviors have returned, and the share of fresh and chilled products in the mix, relative to ambient, is also returning to normal."
Source: GAIN Capital, TradingView
ITV, a media company, released a 1Q trading statement: "Total external revenue was down 7% at £694m (2019: £743m). (...) Significant impact on the demand for advertising across most advertising categories, particularly from April which was down 42%. (...) The outlook remains uncertain and is changing rapidly and therefore we are not giving guidance for Q2 or for the remainder of the year."
JD Sports Fashion, a retailer of fashionable and own brand sports wear, commented on the Competition and Markets Authority's (CMA) decision to prohibit the Company's acquisition of Footasylum Limited: "We firmly believe that the CMA has failed to meet its objective of protecting consumer interests and today's decision will be detrimental for Footasylum, its customers, its 2,500 staff and the UK sports retail market as a whole. We are carefully considering whether to make an application to the Competition Appeal Tribunal to review this decision."
Smith and Nephew, a portfolio medical technology firm, provided a 1Q trading update: "Our first quarter revenue was 1,134 million dollars (2019: 1,202 million dollars), down -7.6% on an underlying basis, (...) Reported growth down -5.7% including a 3.4% benefit from acquisitions (...) Performance of all three global franchises held back by impact of COVID-19 to varying degrees (...) As previously announced, we expect that second quarter revenue and first half trading margin will be substantially down on the prior year."
AstraZeneca, a pharmaceutical group, said its Farxiga has been approved in the U.S. for the treatment of heart failure in patients with heart failure with reduced ejection fraction.
National Express, a public transport company, posted a market update: "In addition to the extensive series of measures the Group announced on 19 March and 14 April 2020 to help the business withstand this period of extreme uncertainty, National Express is today separately announcing a proposed placing of up to 19.99% of the Company's existing issued share capital."
Fresenius, a health care company, reported that 1Q net income grew 1% on year to 459 million euros and EBIT increased 1% to 1.13 billion euros on revenue of 9.14 billion euros, up 8%. The company said: "Fresenius will revisit this guidance when communicating its Q2/20 results with the aim to incorporate a reliable assessment of COVID-19 effects. (...) Fresenius expects to see a more pronounced negative COVID-19 effect on its financial results in the second quarter than in the first quarter of 2020."
Fresenius Medical Care, a dialysis products and services provider, posted 1Q net income rose 4% on year to 283 million euros and operating income climbed 3% to 555 million euros on revenue of 4.49 billion euros, up 9% (+7% at constant currency).
Hannover Re, an insurance group, announced that 1Q net income grew 2.5% on year to 301 million euros while EBIT slid 5.2% to 427 million euros on gross written premium of 7.0 billion euros, up 9.4% (+8.5% currency adjusted).
Fraport, an airport operator, said it swung to a 1Q net loss of 36 million euros from a net profit of 28 million euros in the prior-year period and EBIT sank 85.7% on year to 12 million euros on revenue of 661 million euros, down 17.8%. Regarding the outlook, the company said: "Since there continues to be a high level of uncertainty, it is impossible to make any detailed forecasts at this time. However, the Executive Board confirms its outlook that all key performance indicators will decline significantly, and anticipates a negative Group result for the full 2020 fiscal year."
Credit Agricole, a banking group, announced that 1Q net income declined 32.8% on year to 908 million euros and operating income fell 5.4% to 2.36 billion euros on revenue of 8.37 billion euros, up 2.1%. Also, cost of risk jumped to 930 million euros from 281 million euros in the prior-year period, while CET1 slipped 0.7 percentage point to 11.4%.
Veolia Environnement, an utility and public transportation group, reported that 1Q current net income slid 41.9% on year to 121 million euros and EBITDA fell 5.9% to 970 million euros on revenue of 6.68 billion euros, down 1.6% (-0.5% at constant scope and exchange rates).
Arkema, specialty chemicals and advanced materials company, reported that 1Q adjusted net income declined 39.4% on year to 100 million euros and EBITDA dropped 18.9% to 300 million euros on revenue of 2.09 billion euros, down 5.7%.
Siemens Gamesa, a wind turbines manufacturer, said it swung to a 2Q net loss of 165 million euros from a net profit of 49 million euros, and adjusted EBIT slumped to 33 million euros from 178 million euros on revenue of 2.20 billion euros, down 7.7% on year.
Solvay, a chemical company, reported that 1Q net income posted 1Q underlying net income dropped 18.3% on year to 236 million euros and underlying EBITDA fell 0.4% to 569 million euros on net sales of 2.47 billion euros, down 3.8% (-4.3% organic growth).
UniCredit, an Italian bank, announced that it swung to a 1Q net loss of 2.71 billion euros and loan-loss provision increased to 1.26 billion euros from 467 million euros in the prior-year period. Also, revenue was down 8.2% on year to 4.38 billion euros, while CET1 ratio rose 23 basis points from the prior quarter to 13.44%.
Novo Nordisk, a pharmaceutical group, reported that 1Q net income increased 14% on year to 11.90 billion Danish krone and operating profit rose 14% to 16.30 billion Danish krone on net sales of 33.88 billion Danish krone, up 16% (+14% at constant exchange rates). The company confirmed its full-year sales growth forecast of 3% - 6% and operating growth of 1% - 5%, both at constant exchange rates.
From time to time, GAIN Capital Australia Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.
As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.