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* Evergrande jitters hit again
* STOXX falls from 6-week high
* Miners leading the losses, down 2.5%
* Traders digest mixed batch of Q3 earnings
* Zur Rose slump on quarter sales miss
Oct 21 - Welcome to the home for real-time coverage of
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EQUITIES? YES, IF YOU HAVE FAITH IN THE RECOVERY (0828 GMT)
The TINA (there is no alternative) effect might still help,
but absolute valuations continue to show how equities are
vulnerable to potential headwinds.
As Berenberg analysts put it, “with rates near record lows;
there remains support for equities provided investors have faith
in the growth outlook.”
They mention a batch of near-term risks, including a pickup
in inflation, supply disruptions and friction between COVID-19
politics. Not to mention geopolitical risks and concerns about
the Chinese economy.
“Current absolute valuations make equity markets look
fragile and vulnerable to near-term uncertainties,” they argue.
“On a cyclically-adjusted P/E basis, we are currently higher
than 1929 levels,” they add.
“But earnings yield gaps remain supportive.”
(Stefano Rebaudo)
*****
BACK TO THE BLUES (0816 GMT)
Markets are in a somber mood on Thursday.
There is little let up on the Chinese property sector front
with investors wondering how much damage the Chinese economy
might suffer from a potential default of embattled property
giant China Evergrande Group - now possibly just days
away.
Evergrande shares suffered a double-digit tumble after it
scrapped a deal to sell a stake in its property group, though it
also secured an extension on a defaulted bond, according to
media reports.
Adding to the woes is resurgence of COVID-19 and ensuing
curbs. Russia is suffering record deaths and has reported some
COVID-19 infections with a new coronavirus variant believed to
be even more contagious than the Delta one.
Poland is facing an explosion of cases that may require
drastic action, according to its health minister, while Latvia
starts its lockdown today until mid-November to slow a spike in
infections.
Futures point to more pain ahead for U.S. stocks
later in the day.
But a batch of fresh earnings results might sooth some
frayed nerves.
Unilever and Hermes sales beat estimates,
Truck maker Volvo profit beats forecast, but
companies do flag lingering chip woes.
Barclays Q3 beats expectations on strong
investment bank performance, while Anglo American Q3
production inches higher.
Earnings highlights in the U.S. to come today are Intel
, AT&T and Danaher.
In emerging markets, Turkey's central bank will take centre
stage. Policy makers are expected to deliver another interest
rate cut despite stubbornly high inflation after President
Tayyip Erdogan's midnight reshuffle of the monetary policy
committee.
Key developments that should provide more direction to
markets on Thursday:
-EU starts two day summit
-NATO defense ministers meet
-U.S. initial jobless claims/Philly Fed index/existing home
sales
-U.S. 5-year TIPS auction
-Fed speakers: San Francisco President Mary Daly
-Emerging markets: Turkey, Ukraine central banks
-U.S. earnings: AT&T, Blackstone, Dow, American airlines,
Southwest airlines, Alaska Air, Intel Whirlpool Mattell
(Karin Strohecker)
*****
EVERGRANDE WOES HIT EUROPEAN BOURSES AGAIN (07.45 GMT)
European stocks are in negative territory as sentiment turns
gloomy amid fresh worries about the weakening Chinese property
sector as a possible default by China Evergrande looms within
days.
After jumping to a 6-week high on Wednesday, the
pan-European STOXX 600 is trading 0.2% lower, with basic
resources index leading the losses down 2.1% and set for
its worst day in one month.
Even a bumper Q3 results did little to help Barclays, whose
shares are 1.2% lower.
Swiss engineering and tech group ABB shares fall 4%
after the company lowered its full-year sales forecast and
warned of shortages of components.
On a brighter note, consumer goods giant Unilever
shares are up around 1% after the company beat Q3 sales growth
forecasts as it hiked prices to try to offset surging energy and
other costs.
(Joice Alves)
*****
EUROPEAN STOCKS SEEN LOWER AS EVERGRANDE JITTERS RESURFACE
(0640 GMT)
Futures are pointing to a weaker start of the day for
European bourses as fresh worries about China's property sector
hit global sentiment.
China Evergrande, the heavily indebted developer
at the centre of a credit crunch in China's real estate sector,
said it abandoned a $2.6 billion sale of a stake in a subsidiary
and that it had made no progress on other sales.
But a batch of fresh earnings results could lend some
support to European stocks.
Unilever and Hermes sales beat estimates,
Truck maker Volvo profit beats forecast, but company
flags chip woes linger. Barclays Q3 beats expectations
on strong investment bank performance.
While Anglo American Q3 production inches 2% higher.
But not all is good news on the corporate front, for
instance, ABB flags component bottlenecks as it cuts sales
outlook.
(Joice Alves)
*****
