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By :  ,  Financial Analyst

EU indices positive this morning | TA focus on Segro Plc

Yesterday, European stocks were mixed, with the Stoxx Europe 600 Index closing broadly flat. Germany's DAX 30 declined 0.36%, while France's CAC 40 added 0.28%, and the U.K.'s FTSE 100 was little changed.

52% of STOXX 600 constituents traded lower or unchanged yesterday.
41% of the shares trade above their 20D MA vs 43% Monday (below the 20D moving average).
47% of the shares trade above their 200D MA vs 48% Monday (above the 20D moving average).

The Euro Stoxx 50 Volatility index eased 0.67pt to 25.09, a new 52w high.

3mths relative high: none
3mths relative low: none

Europe Best 3 sectors
automobiles & parts, media, construction & materials

Europe worst 3 sectors
real estate, food & beverage, telecommunications

The 10yr Bund yield was unchanged to -0.52% (below its 20D MA). The 2yr-10yr yield spread rose 2bps to -15bps (above its 20D MA), a new 3mths high.

FR 08:50: Jul Markit Services PMI final, exp.: 50.7
FR 08:50: Jul Markit Composite PMI final, exp.: 51.7
GE 08:55: Jul Markit Services PMI final, exp.: 47.3
GE 08:55: Jul Markit Composite PMI final, exp.: 47
EC 09:00: Jul Markit Composite PMI final, exp.: 48.5
EC 09:00: Jul Markit Services PMI final, exp.: 48.3
UK 09:00: Jul New Car Sales YoY, exp.: -34.9%
UK 09:30: Jul Markit/CIPS UK Services PMI final, exp.: 47.1
UK 09:30: Jul Markit/CIPS Composite PMI final, exp.: 47.7
EC 10:00: Jun Retail Sales MoM, exp.: 17.8%
EC 10:00: Jun Retail Sales YoY, exp.: -5.1%
FR 10:00: Jun Retail Sales MoM, exp.: 25.6%
FR 10:00: Jun Retail Sales YoY, exp.: -12%
GE 10:40: 5-Year Bobl auction, exp.: -0.66%
UK 11:45: 10-Year Treasury Gilt auction, exp.: 0.2%
EC 22:00: Fed Mester speech

In Asian trading hours, the U.S. dollar turned weaker. EUR/USD jumped to challenge 1.1820 on the upside, and GBP/USD topped 1.3090. AUD/USD struck against 0.7190. Meanwhile, USD/JPY traded lower at 105.50, and USD/CAD broke below 1.3300.

Spot gold ran up to $2,031 an ounce before entering a consolidation phase.

Legal & General, a financial services company, posted 1H results: "Profit after tax of 290 million pounds (H1 2019: 874 million pounds), principally reflecting the formulaic impact of lower interest rates on LGI and the unrealised impact of market movements (...) Operating profit of 946 million pounds (H1 2019: 1,005 million pounds), demonstrating resilience as specific COVID-19 estimated impacts totalled 129 million pounds (...) Operating profit from continuing divisions of 1,128 million pounds (H1 2019: 1,154 million pounds), with 3 of 5 businesses delivering growth (...) The Group's Solvency II operational surplus generation from continuing operations increased to 0.8 billion pounds (H1 2019: 0.7 billion pounds). (...) The Board has declared an interim dividend of 4.93p per share, in line with prior year, in order to maintain flexibility as the economic effect of COVID-19 becomes clearer."  

Segro Plc, a property investment firm, announced 1H results: "Adjusted pre-tax profit of 140.4 million pounds up 6.5% compared with the prior year (H1 2019: 131.8 million pounds). Adjusted EPS is 12.5 pence (H1 2019: 12.2 pence) and Adjusted NAV per share up 2.6% to 718 pence (31 December 2019: 700 pence), in part due to a 0.7% (H1 2019: 3.5%) increase in the valuation of the portfolio. (...) Interim dividend increased by 9.5% to 6.9 pence (2019 interim dividend: 6.3 pence)." From a daily point of view, the share is supported by a bullish trend line since May. Moreover, the stock is trading above of its rising 20 and 50 DMAs. Above 939p, look for the previous level of March 2008 at 1040.2p and 1102.4p in extension. Alternatively, a break below 939p would call for a reversal trend.

Source: GAIN Capital, TradingView

BMW, a German car-making major, reported that it swung to a 2Q net loss of 212 million euros from a net income of 1.48 billion euros in the prior-year period. 2Q EBIT sank to a loss of 666 million euros from a profit of 2.20 billion euros a year earlier on revenue of 14.88 billion euros, down 34.2%. The Company said: "For the twelve-month period as a whole, the BMW Group continues to assume that demand in all key markets will be significantly reduced in light of the coronavirus pandemic and the necessary containment measures. (...) Group profit before tax is expected to be significantly lower than in 2019." 

Hannover Re, a reinsurance company, announced that 1H net income dropped 39.3% on year to 402 million euros and EBIT contracted 46.6% to 504 million euros. The Company said: "In the second quarter Hannover Re set aside reserves for estimated losses associated with Covid-19 in an amount of 380 million euros and hence reserved altogether 600 million euros related to property and casualty reinsurance in the first six months." It added: "Hannover Re is maintaining unchanged the anticipated payout ratio for the ordinary dividend in the range of 35% to 45% of its IFRS Group net income."

Vonovia, a German real estate services firm, posted 1H net income of 1.62 billion euros, compared with 125 million euros in the prior-year period when the Company booked a big write-down. 1H EBITDA grew 8.1% on year to 877 million euros.  

Accor, a hotels operator, reported that it swung to a 1H net loss of 1.51 billion euros from a net income of 141 million euros in the prior-year period, citing one-time charges of 1 billion euros including write-down of goodwill for past acquisitions. 1H EBITDA amounted to a loss of 227 million euros, compared to a profit of 375 million euros a year earlier, on revenue of 917 million euros, down 52.5% on year. It also announced plans to cut 1,000 jobs to save costs.

Ahold Delhaize, which operates retail stores in Europe and the U.S., reported that 2Q net income surged to 693 million euros from 334 million euros in the prior-year period (Underlying earnings per share up to 65 European cents from 35 cents) on sales of 19.10 billion euros, up 16% on year at constant exchange rates. The Company proposed raising 2Q dividend to 50 European cents from 30 cents a year earlier. Ahold also said full-year underlying EPS would see a "low-to-mid 20% growth", up from its previous guidance of "mid-single-digit range".   

Roche, a Swiss drug major, announced that it has obtained authorisation from the U.S. Food and Drug Administration (FDA) for the first Epstein-Barr virus quantitative test on the cobas 6800/8800 Systems to improve care for transplant patients.

Sampo, an insurance firm, and Rand Merchant Investment Holdings announced a recommended cash offer to acquire U.K. property & casualty insurance firm Hastings Group for 250 pence per share, which values Hastings at 1.66 billion pounds.
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