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By :  ,  Financial Analyst

EU indices down | TA focus on Hermes

Yesterday, European stocks were broadly lower. The Stoxx Europe 600 Index fell 1.29%, Germany's DAX 30 sank 1.41%, France's CAC 40 declined 1.53%, and the U.K.'s FTSE 100 shed 1.91%.

88% of STOXX 600 constituents traded lower or unchanged yesterday.
41% of the shares trade above their 20D MA vs 61% Tuesday (above the 20D moving average).
56% of the shares trade above their 200D MA vs 61% Tuesday (above the 20D moving average).

The Euro Stoxx 50 Volatility index added 1.82pt to 29.45, a new 52w high.

3mths relative high: Retail, Autos, Media
3mths relative low: Energy

Europe Best 3 sectors
travel & leisure, food & beverage, personal & household goods

Europe worst 3 sectors
media, technology, automobiles & parts

The 10yr Bund yield rose 2bps to -0.61% (below its 20D MA). The 2yr-10yr yield spread fell 1bp to -19bps (below its 20D MA).

GE 07:00: Nov GfK Consumer Confidence, exp.: -1.6
FR 07:45: Oct Business Confidence, exp.: 96
FR 07:45: Oct Business Climate Indicator, exp.: 92
EC 08:00: ECB Panetta speech
UK 09:30: BoE Haldane speech
UK 10:25: BoE Gov Bailey speech
UK 11:00: Oct CBI Industrial Trends Orders, exp.: -48
UK 11:00: Q4 CBI Business Optimism Idx, exp.: -100%
EC 15:00: Oct Consumer Confidence Flash, exp.: -13.9
UK 00:01: Oct Gfk Consumer Confidence, exp.: -25

In Asian trading hours, the U.S. dollar regained strength, as EUR/USD retreated to 1.1842 and GBP/USD eased to 1.3127. USD/JPY bounced to 104.70.

Spot gold dropped to $1,913 an ounce.

IAG, an airline group, posted 3Q preliminary results and update: "Total revenue declined by 83 per cent to E1.2 billion compared to E7.3 billion last year. Operating result before exceptional items was a E1.3 billion loss compared to a E1.4 billion profit last year. (...) In response to the high uncertainty of the current environment, IAG now plans for capacity in 4Q 2020 to be no more than 30 per cent compared to 2019. As a result, the Group no longer expects to reach breakeven in terms of Net cash flows from operating activities during 4Q 2020."

Unilever, a consumer goods company, reported that 3Q underlying revenue rose 4.4% on year to 12.9 billion euros and 9-month revenue was up 1.4% to 38.6 billion euros. The company declared a quarterly dividend of 0.4104 euro per share.

Anglo American, a multinational mining group, released a 3Q production report: "Rough diamond production decreased by 4% to 7.2 million carats driven by planned reductions in production to reflect the lower demand for rough diamonds due to the Covid-19 pandemic. (...) Copper production increased by 4% to 165,700 tonnes, driven by strong plant performance at Collahuasi. (...) Platinum production decreased by 2% to 516,500 ounces and palladium production was flat at 352,200 ounces."

Pernod Ricard, an alcoholic beverages producer, announced that 1Q net sales dropped 10.0% on year to 2.24 billion euros, down 5.6% on an organic basis. The company said 2Q is expected to still be strongly impacted by Covid-19, but sees net sales returning to growth in 2H.

Hermes, a high fashion luxury goods manufacturer, posted 3Q revenue grew 4.2% on year (+6.9% at constant exchange rates) to 1.80 billion euros, citing "the momentum in Asia and a significant improvement in all other geographical areas". Meanwhile, 9-month revenue was down 14.4% (-14.0% at constant exchange rates) to 4.29 billion euros. 
From a daily point of view, the bullish gap opened on October 16th has allowed the stock to break above the resistance area and previous all-time high at 788.2E. In addition, a rising trend line is in place since April. Above 735E, look for 850E and 900E in extension.

Source: TradingView, GAIN Capital

STMicroelectronics, an electronics and semiconductor manufacturer, posted 3Q net income declined 19.6% on year to 242 million dollars and operating income fell 2.0% to 329 million dollars on net revenue of 959 million dollars, up 4.4%. The company said it expects 4Q net revenue to grow 12.0% to 2.99 billion dollars.

Sika, a specialty chemical company, reported that 9-month net profit slipped 0.9% on year to 562 million Swiss franc on net sales of 5.81 billion Swiss franc, down 3.4% (+2.6% in local currency).

SEB, a Swedish financial group, announced that 3Q net income slipped 0.1% on year to 4.78 billion Swedish krona, while net expected credit losses reduced to 1.10 billion Swedish krona from 2.69 billion Swedish krona in the prior quarter. Meanwhile, net interest income grew 5.9% on year to 6.34 billion Swedish krona.

DNB, a Norwegian financial services group, posted 3Q net income dropped 8.0% on year to 5.29 billion Danish krone, while impairment of financial instruments narrowed to 0.78 billion Danish krone from 1.25 billion Danish krone in the prior-year period. Also, net interest income was down 6.9% to 9.30 billion Danish krone. The company said it has proposed a dividend of up to 9 Danish krone per share for 2019 and share buyback of up to 4.0% of the company's share capital.

BAE Systems:9.4p, Prosus: E0.11, Telia: SEK0.9
Related tags: Commodities Equities

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