14 10 EU PRE OPEN

EU indices mixed | TA focus on Bunzl

INDICES

Yesterday, European stocks were broadly lower. The Stoxx Europe 600 Index fell 0.55%, Germany's DAX 30 sank 0.91%, France's CAC 40 lost 0.64%, and the U.K.'s FTSE 100 was down 0.53%.

EUROPE ADVANCE/DECLINE
72% of STOXX 600 constituents traded lower or unchanged yesterday.
69% of the shares trade above their 20D MA vs 79% Monday (above the 20D moving average).
63% of the shares trade above their 200D MA vs 64% Monday (above the 20D moving average).

The Euro Stoxx 50 Volatility index added 0.69pt to 22.94, a new 52w high.

SECTORS vs STOXX 600
3mths relative high: none
3mths relative low: Insurance

Europe Best 3 sectors
telecommunications, media, technology

Europe worst 3 sectors
banks, insurance, travel & leisure

INTEREST RATE
The 10yr Bund yield fell 2bps to -0.55% (below its 20D MA). The 2yr-10yr yield spread rose 0bp to -18bps (above its 20D MA).

ECONOMIC DATA
EC 09:00: ECB President Lagarde speech
FR 09:00: IEA Oil Market Report
EC 10:00: Aug Industrial Production YoY, exp.: -7.7%
EC 10:00: Aug Industrial Production MoM, exp.: 4.1%
GE 10:40: 30-Year Bund auction, exp.: -0.07%
EC 12:00: ECB Mersch speech
EC 13:00: ECB Lane speech

MORNING TRADING
In Asian trading hours, EUR/USD remained subdued at 1.1745 and GBP/USD was under pressure at 1.2936. USD/JPY dropped further to 105.38.

Spot gold marked a day-low near $1,883 before bouncing back to $1,892.

#UK - IRELAND#
Bunzl, a distribution and outsourcing company, posted a 3Q trading statement: "Bunzl's diversified and resilient business model has delivered strong overall growth over a challenging period, with Group revenue for the third quarter up 4.0% at actual exchange rates and 8.8% at constant exchange rates. Underlying revenue increased strongly by 8.0% at constant exchange rates reflecting the continued growth in the sale of Covid-19 related products, such as masks, sanitisers, gloves and disinfectants. (...) However, given the performance year to date and the impact of recently announced acquisitions, the Company currently expects revenue in the second half of 2020 to grow strongly at constant exchange rates and anticipates a slightly higher second half operating profit margin compared to the prior year."
From a weekly point of view, following the last March-April V-bottom pattern , a weekly close above 2600 is needed to release a new upward potential towards 3000.

Source: GAIN Capital, TradingView

Barratt Developments, a residential property developer, released a trading statement for the period from July 1 to October 11: "Our sales rate in the period was 0.871 net private reservations per active outlet per average week, up 20.8% on last year (2020: 0.72). (...) In the period we delivered 4,032 (2020: 3,252) home completions (including JVs), up 24.0% on last year. Total forward sales (including JVs) as at 11 October 2020 were 15,135 homes (13 October 2019: 12,963 homes) at a value of £3,647.6m (13 October 2019: £3,070.2m)."

Anglo American, a multinational mining company, reported that the value of rough diamond sales for De Beers' eighth sales cycle of 2020 amounted to 467 million dollars, compared with 297 million dollars in the prior-year period.

Standard Life Aberdeen, a global investment company, was upgraded to "buy" from "hold" at HSBC.

#GERMANY#
Hapag-Lloyd, a shipping and container transportation company, was upgraded to "overweight" from "underweight" at JPMorgan.

#FRANCE#
Vivendi's subsidiary, Universal Music Group's shareholder Chinese tech giant Tencent may exercise the option to increase its holding in the company to as much as 20% from 10%, reported Bloomberg citing people familiar with the matter.

Accor, a hospitality company, was downgraded to "hold" from "buy" at Deutsche Bank.

#SPAIN#
Repsol, a fossil fuel company, was downgraded to "hold" from "buy" at HSBC.

#BENELUX#
ASML Holding, a supplier of photolithography systems for the semiconductor industry, announced that 3Q net income rose 69.4% on year to 1.06 billion euros on net sales of 3.96 billion euros, up 32.5%. The company said: "We expect fourth-quarter revenue of between E3.6 billion and E3.8 billion with a gross margin of around 50%, R&D costs of E550 million and SG&A costs of E140 million. Our outlook for the full year 2020 is therefore confirmed. (...) For 2021, we expect low double-digit growth."

Just Eat Takeaway, an online food order and delivery service provider, reported that 3Q orders increased 46% on year to 151 million and were up 37% to 408 million in the 9-month period.

#DENMARK#
DSV Panalpina, a Danish transport and logistics company, was downgraded to "neutral" from "overweight" at JPMorgan.

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