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IBERIAN DAILY 20 JANUARY + 4Q’21 RESULTS. PREVIEWS (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ACS, SIEMENS GAMESA, TOURISM SECTOR.

At the end of today’s report, and during the entire results season, we will include a presentation with positive and negative results highlights and previews for the 4Q’21 results to be released over the coming days in Spain.

MARKETS YESTERDAY AND TODAY

European indices consolidate at support levels and China cuts interest rates
A results season somewhat better than expected and the slowdown in the US TNote backed the European stock markets, which closed with slight gains. Within the Euro STOXX, the best-performing sectors were Retail and Consumer Goods, whereas Media and Banks saw the biggest losses. On the macro side, in the UK, December’s inflation sped up above expectations to 5.4%, with core inflation rising to 4.2%, also beating expectations. In the US, December’s housing starts and building permits slowed, but less than expected, increasing once again. On another note, the Biden administration warned that Russia will invade Ukraine shortly and for this reason it will be subject to new retaliations. In China, the PBoC cut 1Y lending interest rates by 10bps to 3.7% and 5Y lending interest rates by -5bps to 4.6%. In US business results, Bank of America and Morgan Stanley came in better, Citrix in line and Procter & Gamble and US Bancorp worse.
What we expect for today
European stock markets would open with gains >+0.5% and a slightly better performance of growth sectors. The WHO announced the end of the pandemic with 70% of the global population vaccinated, far above the current level. Currently, S&P futures are up +0.45% (the S&P 500 ended -1.07% lower vs. the European closing bell). Volatility in the US rose (VIX 23.85). Asian markets are climbing (China’s CSI 300 +1% and Japan’s Nikkei +1.1%), benefiting from the rate cut in China.
Today we will learn in the Euro zone December’s final inflation data and the ECB monthly report, and in the US weekly jobless claims, the Philadelphia Fed index for January and December’s second-hand home sales data. In US business results, Keycorp, M&T Bankcorp, American Airlines, Union Pacific and Netflix, among others, will release their earnings. In debt auctions: France (€ 11.75 Bn in bonds due 2025, 2027 and 2028 and I/L bonds due 2026, 2031 and 2032) and Spain (€ 5 Bn in bonds due 2027, 2030 and 2040).