IBERIAN DAILY 05 DECEMBER (ANÃLISIS BANCO SABADELL)
NEWS SUMMARY: BBVA, REPSOL.MARKETS YESTERDAY AND TODAY
Risk appetite returns
Stock markets rose once again in view of the macro data and the expectations of a trade agreement, which also aided the rise in sovereign debt yields. This mainly boosted the cyclical sectors of the Euro Stoxx, where Banks and Basic Resources led the gains, whereas Real Estate and Telecoms (dragged down by Orange) were the only sectors in the red. On the macro side, in the euro zone November’s services PMI was raised to 51.9 from the previous 51.5 thanks to Germany and Spain, and it continues to suggest growth of more than 1.0% YoY. From the ECB, K. Knot (member of the Board) warned that the organisation needs more flexibility in its monetary policy strategy in order to meet the inflation target, but he believes the fight against climate change should be a secondary aim. In the UK, the services PMI rose more than expected to close to 50. In the US, the non-manufacturing ISM fell more than expected in November, but it continues to suggest growth of 2.0% YoY. Meanwhile, ADP private employment rose less than expected in November. In Brazil, the services PMI fell in November to 50.9 vs. the previous 51.2, and industrial output rose less than expected in October. In Japan, the government announced, as expected, a US$ 120 Bn tax package (below that of 2016) focused on infrastructures.
What we expect for today
Stock markets would open with slight gains. Currently, S&P futures are unchanged (the S&P 500 ended unchanged vs. its price at the closing bell in Europe). Volatility in the US dropped (VIX 14.80%). The Asian markets that are open are climbing (Hong Kong +0.71% and Japan +0.49%).
Today OPEC+ will meet. In Germany we will learn October’s factory orders, in Spain industrial output, in the euro zone the final 3Q’19 GDP and in the US durable goods orders and October’s trade balance. Debt auctions: Spain (€ 4 Bn in bonds due 2024, 2028 and 2048) and France (€ 5 Bn in bonds due 2028, 2029 and 2060).
Banco Bilbao Vizcaya Argentaria is an international financial group, engaged primarily on providing banking services and consumer finance to private individuals and businesses in Spain and Portugal; providing real estate activity in Spain; providing services to international companies and investment banking, capital markets and treasury management services to clients; and providing the banking, insurance and pension businesses in Mexico and the U.S., as well as in South America.
Repsol is an oil and gas company. Co. is engaged in all the activities relating to the oil and gas industry, including exploration, development and production of crude oil and natural gas, transportation of oil products, liquefied petroleum gas (LPG) and natural gas, refining, the production of a wide range of oil products and the retailing of oil products, oil derivatives, petrochemicals, LPG and natural gas, as well as the generation, transportation, distribution and supply of electricity. Co. operates in more than 40 countries. Co.'s operations are divided into four segments: Upstream, Downstream, LNG and Gas Natural Fenosa.
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