* STOXX 600 hits record high
* Travel and leisure leading the pack
* German industrial output falls unexpectedly in April
* ICG at record high on jump in annual AUM
June 8 - Welcome to the home for real-time coverage of
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CORPORATE RECESSION: THIS TIME AIN'T DIFFERENT (1015 GMT)
Corporate profits tend to recover slower than expected after
a recession and the bad news is, it doesn't look that this time
around it will be any different!
Liberum, analyzed almost 300 years of corporate earnings in
the U.S., UK and in the EZ to find out how corporate profits
behave in the recovery after a recession.
"Corporate profit growth tends to recover with a substantial
lag after a recession, often accelerating only in year 2 after a
recession," they say.
Because of the nature of the COVID-induced recession,
analysts expect profits to jump extremely fast. But Liberum
believes growth will actually be below consensus in the U.S. and
in the UK.
"We think analysts have become too optimistic and we expect
growth expectations to be downgraded in H2 2021 potentially
triggering stock market weakness", they say.
Liberum sees EPS growth in 2021 in the U.S. 14.3% below
consensus and in the UK 62.6% below consensus.
In the EZ, things will be better and they see EPS growth
19.7% above consensus.
They are far more optimistic for 2022, where they expect
profit growth to exceed current consensus by 10% to 37%.
(Joice Alves)
*****
FRESH RECORD HIGHS, ONCE AGAIN (0735 GMT)
European stocks hit fresh record highs supported by
utilities and telecom, while weak German industrial output
capped the enthusiasm.
The pan-European STOXX 600 index is up 0.2% with the
telecom and utilities indices gaining each 0.7%.
In the meantime, Germany's DAX is just off record
highs and it is flat on the day after data showed that a lack of
semiconductors, timber and other intermediate goods drove an
unexpected fall in German industrial output in April.
In terms of single stocks, Intermediate Capital is
the biggest winner after the company reported a 19% jump in AUM
and said it is raising its fundraising targets.
(Joice Alves)
*****
MORE FRAGILE THAN WE THOUGHT? (0805 GMT)
Signs the global economic recovery may be more fragile than
recently thought unnerved investors slightly on Tuesday, with
markets mostly trading sideaways ahead of big data releases and
the European Central Bank meeting later this week.
Oil prices, which have surged in recent months as a
barometer for returning global demand following pandemic-induced
downturns, fell from two-year highs after data showed China's
oil imports fell in May.
German industrial production numbers for April also
declined.
There was the weaker-than-expected U.S. jobs data on Friday
too, which came in below expectations -- although that initially
boosted markets as it suggested Federal Reserve tapering of
asset purchaes won't happen so soon.
Stock markets were mixed and were likely in a holding
pattern ahead of Thursday, when the ECB meets and crucial U.S.
inflation data is published.
Whether the rally in share prices this year can continue
will hinge it part on whether inflation proves more than a
short-term phenomenon as most central bank policymakers
currently believe.
Currency markets were little moved, with the dollar finding
some support against the euro before the ECB meeting.
Key developments that should provide more direction to
markets on Tuesday:
Final euro zone jobs/GDP/Zew
BOE outgoing chief economist Andy Haldane speaks 1300 GMT
German industrial output/ZEW
Economic forum in Spain
Chile central bank meeting
U.S. trade balance April
U.S. NFIB business optimism/JOLTS job openings
Auctions: US 3 yr notes; German 7 yr bund; UK 50-yr gilt
Earnings: Gamestop
(Tommy Wilkes)
*****
EUROPE SET FOR SUBDUED START IN DATA HEAVY MORNING (0545
GMT)
After touching fresh record highs, futures are pointing to a
lower open for European shares as investors look for inflation
and monetary policy clues, in a data-heavy week full of key
central bank meetings.
Global stocks have been pinned around record highs as major
economies reopen, but concerns that the recovery may not be as
fast as hoped and signs of rising inflation are slowing the pace
of gains.
In the meantime, Germany's DAX is seen a tad lower
but still close to record highs ahead of the latest German
industrial production numbers for April and June ZEW survey of
investor.
EZ employment and GDP data is also due, whil later in the
day, more data is expected from the U.S. including JOLTS job
openings.
(Joice Alves)
*****