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By :  ,  Financial Analyst

EU indices up again this morning | TA focus on Kainos

Yesterday, European stocks were broadly higher. The Stoxx Europe 600 Index rallied 1.8%, Germany's DAX 30 rose 2.1%, France's CAC 40 gained 1.9% and the U.K.'s FTSE 100 was up 1.4%.

79% of STOXX 600 constituents traded higher yesterday.
56% of the shares trade above their 20D MA vs 42% Tuesday (below the 20D moving average).
54% of the shares trade above their 200D MA vs 50% Tuesday (below the 20D moving average).

The Euro Stoxx 50 Volatility index eased 0.5pt to 26.61, a new 52w high.

3mths relative high: Chemicals, Technology
3mths relative low: Banks, Energy

Europe Best 3 sectors
personal & household goods, health care, chemicals

Europe worst 3 sectors
banks, basic resources, energy

The 10yr Bund yield fell 2bps to -0.42% (above its 20D MA). The 2yr-10yr yield spread rose 3bps to -23bps (below its 20D MA).

FR 08:50: Aug Markit Services PMI final, exp.: 57.3
FR 08:50: Aug Markit Composite PMI final, exp.: 57.3
GE 08:55: Aug Markit Services PMI final, exp.: 55.6
GE 08:55: Aug Markit Composite PMI final, exp.: 55.3
EC 09:00: Aug Markit Services PMI final, exp.: 54.7
EC 09:00: Aug Markit Composite PMI final, exp.: 54.9
UK 09:30: Aug Markit/CIPS UK Services PMI final, exp.: 56.5
UK 09:30: Aug Markit/CIPS Composite PMI final, exp.: 57
EC 10:00: Jul Retail Sales YoY, exp.: 1.3%
EC 10:00: Jul Retail Sales MoM, exp.: 5.7%
FR 10:00: 10-Year OAT auction, exp.: -0.27%
FR 10:00: Jul Retail Sales MoM, exp.: 9.4%
FR 10:00: Jul Retail Sales YoY, exp.: 5%
UK 15:00: BoE Gov Bailey speech
EC 16:00: ECB Schnabel speech


In Asian trading hours, EUR/USD slid further to 1.1832 and GBP/USD fell to 1.3338. USD/JPY held gains at 106.24. AUD/USD remains subdued at 0.7327. Data released this morning showed that China's Caixin Services PMI slipped to 54.0 in August (53.9 expected) from 54.1 in July. 

Spot gold rebounded to $1,949 an ounce.

ITV, a media group, will be replaced by variety retailer B&M European Value Retail in the FTSE 100 Index, effective from the start of trading on September 21, according to FTSE Russell.

Melrose Industries, an investment group, posted 1H results: "The adjusted results for the period ended 30 June 2020 show revenue of £4,359 million (2019: £5,875 million), an operating profit of £56 million (2019: £541 million) and a loss before tax of £40 million (2019: profit of £431 million).  Adjusted diluted EPS were a loss of 0.7 pence (2019: profit of 6.8 pence). (...)  The Board concluded it was not appropriate to pay a final dividend for 2019 in May and considers it inappropriate to pay an interim dividend for 2020."

Kainos, a software company, released a trading update for the period from 1 April 2020 to date: "Further to the 27 July 2020 trading update, trading in the period continues to be resilient across both business areas, supported by long-term customer relationships and diversified revenues across customers, end markets and geographic regions. As such, the Company expect results for the full year ending 31 March 2021 to be in line with consensus forecasts." From a technical point of view, the upward breakout - thanks to a breakaway gap - of the 900 horizontal resistance threshold - in place since the beginning of 2020 - has triggered a new up move towards 1340p. Furthermore, the RSI is reading to bounce off its positive trend line. 

Source: GAIN Capital, TradingView

Next, a retailer, was downgraded to "underweight" from "equalweight" at Morgan Stanley.

Siemens Healthineers, a medical technology group, said it has successfully placed 75 million new shares with institutional investors at 36.40 euros per share, resulting in gross proceeds of around 2.73 billion euros. The company said: "As communicated earlier, Siemens Healthineers plans to use the proceeds from the capital increase, following deduction of commissions and expenses, to partially finance the announced acquisition of Varian Medical Systems, Inc."

Capgemini, a technology and consulting company, announced that 1H net income declined 20% on year to 311 million euros and operating profit dropped 12% to 577 million euros on revenue of 7.58 billion euros, up 8.2% (+7.9% at constant exchange rates). The company expects full-year revenue growth at constant exchange rates of between +12.5% and +14.0%.

Iliad, a telecommunication services provider, reported that 1H profit from ordinary activities fell 7.2% on year to 218 million euros while  EBITDAaL grew 9.4% to 876 million euros on revenue of 2.78 billion euros, up 6.8%.

Sanofi and GlaxoSmithKline, the two pharmaceutical groups, announced they have started the phase 1/2 clinical trial for their adjuvanted COVID-19 vaccine, and aim to move into phase 3 by end of 2020.

Air Liquide, an industrial gases supplier, announced a long-term supply agreement with Eastman Chemical to provide industrial gases in Texas, and said it will invest more than 160 million dollars to modernize existing assets and build a new Air Separation Unit and Partial Oxidation Unit.

EDP Renovaveis, a renewable energy company based in Spain, posted 1H net income slid 26% on year to 255 million euros and EBITDA dropped 18% to 793 million euros. 

BHP Billiton (BHP): $0.55, CRH (CRH): $0.22
Related tags: Commodities Forex Equities

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