EUR 100.00 For Business Accounts Only

IBERIAN DAILY 27 NOVEMBER (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ENDESA, RED ELÉCTRICA.

MARKETS YESTERDAY AND TODAY

Consolidating levels
In view of the lack of drivers, European markets focused on China’s comments on trade talks, which are more optimistic. In the Euro Stoxx, the biggest gains came in Real Estate and Personal Household Goods vs. the drops in Banks and Energy. On the macro side, in Spain the Tax Office calculates that Spanish companies pay 12.6% of their global profit as corporation tax. From the ECB, F. Villeroy stated that the low rates will continue to underpin the economy. In Europe, Von Der Leyen will claim to invest additional € 3 trillion against climate change through 2030. In the US, November’s Richmond manufacturing index contracted unexpectedly, October’s new home sales once again fell unexpectedly and November’s consumer confidence fell (125.5 vs. 127 expected), despite the new high hit by the S&P 500 although remaining at high levels that underpin a dynamic private consumption above 1.6% q/qa expected by the consensus. From the Fed, R. Kaplan conditioned big changes in forecasts to new rate cuts. Brainard in turn was against negative rates. In China, October’s business profits fell at the fastest pace since 2011 (-9.9% YoY vs. 5.3% previously). In US business results, Best Buy beat expectations and Autodesk came in worse than expected. Dell cut 2020 sales forecast.
What we expect for today
The markets would open with a slightly bullish slant. Currently, S&P futures are up +0.11% (the S&P 500 closed practically flat vs. its price at the closing bell in Europe). Volatility in the US fell (VIX 11.54%). The Asian markets that are open are trading with mixed results (Hong Kong -0.03% and Japan +0.28%).
Today in Mexico we will learn October’s trade balance and in the US the second reading of the 3Q’19 GDP, October’s preliminary durable goods orders, weekly jobless claims, October’s personal income and outlays, October’s pending home sales and the Fed’s Beige Book. In debt auctions: Germany (up to € 3 Bn in 5Y bonds) and Italy (€ 6.5 Bn in 6M t-bills).