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NEW RECORD IN SIGHT AS EARNINGS LIFT STOXX 600 (0734 GMT)
It's another busy earnings day and so far there are plenty
of beats which are lifting sentiment and bringing the STOXX 600
just inches to a new record high.
As analysts tend to stress these days, it takes quite a lot
of good news to take arguably stretched valuations higher, but
it seems to be happening nonetheless.
The pan-European index is up 0.3% at 442.6 points so it
wouldn't take much to rise over the 443.6 points reached on
April 19.
Two sectors stand out this morning, banks, with Socgen up a
handsome 6% after its well received earnings and Unicredit
rising around 5%, also boosted by its update.
Beer giant AB Inbev is galvanizing the food and beverage
index, rising 3.8% on a good set of results.
Car makers are making a comeback with the index edging up
with Volkswagen gaining 1.6% in early trade after the company
raised its operating margin target for 2021.
Quick reminder, the best way to keep track on the earnings
action this morning in Europe is to click here:
(Julien Ponthus)
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BRITAIN'S ANTICLIMATIC SUPER THURSDAY (0708 GMT)
As Britons make their way to polling stations for local
elections, the focus is on Scotland where an outright majority
for the pro-independence Scottish National Party could trigger a
showdown with Boris Johnson's government, and hit the pound.
There's a couple of things, however, which explain
investors' relatively low anxiety levels: results due on the
weekend could show the SNP lost momentum, opinion polls have
indicated. And whatever the result, Downing Street is determined
not to permit an independence referendum.
A more pressing matter may be the Bank of England's policy
meeting where there is a chance it could talk of trimming
support for the recovering economy. It is also likely to say
Britain's economy is heading for a much stronger recovery this
year than it previously expected.
Any more hawkish than that and we are likely to see a market
impact.
As shown by the FTSE 100 index reclaiming the 7,000-point
bar on Wednesday and making its biggest jump since February,
sentiment is quite upbeat.
Also, with the Bank of Japan stressing the need for low
interest rates and U.S. Treasury Secretary Janet Yellen walking
back her comments on the possible need for rate hikes, the doves
clearly have the upper hand.
Norway's central bank may shed light on its intention to
tighten policy in the second 2021 half but will leave interest
rates unchanged today.
In the meantime, stock markets are at or close to record
levels; the Dow Jones hit a peak on Wednesday and the
pan-European STOXX 600 stands 0.4% off a new milestone,
galvanized by stellar ongoing Q1 earnings.
Other key developments that should provide more direction to
markets on Thursday
- German manufacturing March
- Euro zone retail sales
- Rebound in trading boosts SocGen earnings
- UniCredit Q1 profit tops forecasts
- ECB: today's speakers include Vice President Luis de
Guindos and ECB Board member Isabel Schnabel
- Fed: New York Fed President John Williams and Dallas Fed
President Robert Kaplan
-U.S. initial jobless
-U.S. earnings: Kellog, Expedia, NewsCorp, AIG
(Julien Ponthus)
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UNDECIDED EUROPEAN STOCKS EYE NEW RECORD HIGH (0529 GMT)
The pan-European STOXX 600 is just 0.4% from another record
high but given how flat futures are trading at the moment,
there's absolutely no guarantee a new milestone will be crossed
today.
There's not that much momentum coming from the East where
MSCI's broadest index of Asia-Pacific shares outside Japan
fell 0.21%.
There's plenty going on though in terms of earnings and
central bank action which could quickly swing sentiment either
way.
(Julien Ponthus)
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