EUR 100.00 For Business Accounts Only

IBERIAN DAILY 13 OCTOBER (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: SACYR.

Markets left wanting more from drop in US inflation
After a first half of the session in which European stock markets trended upwards, following the release of US inflation data (rising yields and slight bearish opening in NY), European indices yielded all the ground gained to close flat or with slight drops. In the STOXX 600, which managed to rise +0.14%, the sectors clearly closing in positive territory were Energy (thanks to the rise in crude prices in view of the commitment by Saudi Arabia and Russia to maintain prices), Media, Pharma and Technology, whereas the sectors most closely linked to consumption, both cyclicals like Consumer Goods and Leisure, and non-cyclicals like Household Goods, ended with the biggest losses. On the macro side, in the US, September’s general inflation unexpectedly repeated the previous 3.7% YoY figure, but falling in line with expectations on the core level. In the UK, August’s industrial output recovered less than expected. In Mexico, August’s industrial output grew unexpectedly. This morning in China, both imports and exports saw their contraction slow more than expected, whereas inflation is once again flirting with deflation, coming in unexpectedly at 0.0% YoY, although the core figure remained stable at 0.8%. Separately, according to Bloomberg, the Govt. would be mulling the possibility of creating a stabilisation fund with state funds in what could be the first state intervention on capital markets since 2015. In US business results, Domino’s Pizza beat expectations and Delta Airlines was in line.
What we expect for today
European stock markets would open with losses of around -0.5%. Currently, S&P futures are up +0.1% (the S&P 500 ended -0.65% lower vs. the European closing bell). Volatility in the US rose (VIX 16.69). Asian stock markets are falling (China’s CSI 300 -1.2%, Japan’s Nikkei -0.64%).
Today in the US we will learn October’s U. of Michigan sentiment index, in the EU August’s industrial output, in Spain and France September’s final CPI. In US business results, JP Morgan, Wells Fargo, Blackrock and Citigroup, among others, will release their earnings.