EUR 100.00 For Business Accounts Only

IBERIAN DAILY 02 SEPTEMBER (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: BANKING SECTOR, MEDIASET ESPAÑA, TELEFÓNICA.


MARKETS YESTERDAY AND TODAY

Germany goes against the grain
EU core markets outperformed peripheral ones (DAX +0.2% vs. -0.2%), evidencing the latter’s weaker recovery, whereas the US market recovered thanks to the better relative performance of growth stocks. Thus, the Euro STOXX closed with slight gains, led by Technology and Retail vs. Travel & Leisure and Food, which saw the biggest drops. On the macro side, in the Euro zone, the unemployment rate climbed somewhat less than expected in July and the inflation rate (YoY) plunged unexpectedly into negative territory, while core inflation slowed more than expected. August’s final manufacturing PMI confirmed the cut to the preliminary data, with Spain’s falling to 49.9 vs. Germany’s 52.2. Moreover in Spain, vehicle sales plummeted once again in August (-43.2% m/m and -10.1% y/y). In the US, August’s ISM manufacturing index climbed more than expected, hinting at levels above the 21.2% QoQ annualised in 3Q’20, where the orders/inventories ratio hints at a strong recovery of industrial output. Separately, Fauci warned that the vaccine might be ready sooner if the phase III clinical trials are extraordinarily successful. Meanwhile, Mnuchin warned that the US needs a fifth stimulus package against Covid-19, but negotiations have come to a standstill (Republicans aim at US$ 0.5 Tn vs. the US$ 1.5 Tn demanded by the Democrats). In Brazil, the 2Q’20 GDP figure came in below expectations, falling by 11.4%
What we expect for today
The European stock markets would open with gains led by growth stocks.
Currently, S&P futures are up +0.38% (the S&P 500 ended up +0.51% vs. its price at the closing bell in Europe). Volatility in the US dropped (VIX 26.12%). Asian markets are trading with mixed results (Japan +0.36% and Hong Kong -0.3%).
Today we will learn in the US, August’s ADP private employment survey, July’s factory orders and July’s durable goods orders. In debt auctions: Germany (€ 4 Bn of bonds due 2025).