IBERIAN DAILY 28 SEPTEMBER (ANÁLISIS BANCO SABADELL)
NEWS SUMMARY: BBVA, SANTANDER.Markets conditioned by debt yields
The European stock markets posted slight losses in another session marked by monetary tightening fears. Within the Euro STOXX, the day’s best-performing sectors were Energy and Household Goods, whereas Real Estate and Banks saw the biggest drops. On the macro side, in the Euro zone, August’s M3 increased above expectations. Separately, the IMF warned the UK against implementing an indiscriminate expansionary fiscal policy. In the US, the Conference Board consumer confidence climbed more than expected in September. As for August’s core capital goods orders, they rose far above expectations, hinting at some recovery of capital goods orders, whereas the Richmond Fed index for September improved more than expected. In the residential sector, new home sales recovered unexpectedly in August, although home prices fell for the first time since 2012 (excl. the pandemic). From the Fed, J. Bullard reiterated that bringing inflation under control is a top priority, whereas Evans admitted that the institution cannot wait to see the effect from rate hikes. In China, the yuan fell to 14-year lows, and the PBoC warned that it will take measures to prevent it from depreciating further. On the geopolitical front, several European countries (Denmark, Sweden, Germany, etc.) reported three gas leaks in the Nordstream I and II pipelines that might have been the result of sabotage. Separately, there are now 13 EU countries requesting the EC impose a cap on gas prices, to be debated on Friday (among other things) in the Energy Ministers meeting.
What we expect for today
European stock markets would fall around -0.5%, where risks of a recession in view of monetary tightening (the US 10Y bond will hit 4.0% today) and geopolitical uncertainty continue. Currently, S&P futures are down -0.6% (the S&P 500 ended -0.17% lower vs. the European closing bell). Volatility in the US rose (VIX 32.60). Asian markets are falling (China’s CSI 300 -1.3% and Japan’s Nikkei -2.25%).
Today we will learn in the US, August’s pending home sales. In debt auctions: Greece (€ 625 M in 6M T-bills).
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.
Banco Santander is a holding company, providing a range of financial products. Co.'s products and services include: retail banking business that covers all customer banking businesses; wholesale banking business; as well as asset management and insurance business. Co.'s principal operations are in Spain, the U.K., Portugal, Germany, Italy and Latin America. As of Dec 31 2014, Co.'s total assets amounted to Euro1,266,296,000,000 and total customer deposits amounted to Euro647,627,000,000.
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