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IBERIAN DAILY 29 SEPTEMBER (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ALMIRALL, BANKING SECTOR, ELECTRICITY SECTOR.

BoE influences debt markets and spurs markets
European stock markets ended with slight gains in a session that began with clear risk aversion and concluded with strong tightening of debt curves thanks to the BoE’s calming message. In the Euro STOXX, the best-performing sectors were Real Estate and Retail, whereas the hardest hit were Financials, with Banks and Insurance leading the losses. On the macro side, in Europe the EU affirmed that energy systems will be protected after the “sabotage” of the Russian gas pipelines, promising new sanctions if the saboteurs were to turn out to be Russian. From the ECB, P. Kazimir and O. Rehn hinted at +75bps rate hikes in the October and November meetings. In the UK, the BoE announced the purchase of “all public debt necessary” through 14 October in order to stabilise bond markets and delay the £ 80 Bn QT (and bond sales) until 31 October. In the US, August’s pending home sales contracted more than expected. In geopolitics, Russia announced the result in favour of the referendum in occupied Ukraine regions and warned of an annexation of these territories, while the EU is working on new sanctions that would include a cap on oil prices.
What we expect for today
European stock markets would open with slight gains that could reach +0.5%. Currently, S&P futures are down -0.4% (the S&P 500 ended +1.04% higher vs. the European closing bell). Volatility in the US fell (VIX 30.18). Asian markets are rising (China’s CSI 300 +0.34% and Japan’s Nikkei +0.9%).
Today we will learn in Germany and in Spain September’s inflation data, and in the Euro zone August’s consumer confidence. In debt auctions: Italy (€ 7.5 Bn in bonds due 2027, 2032 and CCT due 2030).