Early strength in European stocks gives way to losses at the close after Italy's populist government says it needs a dialogue with the EU about its 'necessary' breach of deficit rules
Oct 22, 2018
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*Data in Price Return and Updated Real-Time (with a delay), Source: StockDio
- European stocks were up early in the day but gave back everything and closed with losses after Italy's populist government said it needs a dialogue with the EU over its "necessary' breach of EU deficit rules next year
- The Euro Stoxx 600 closed down -0.42%, the FTSE 100 declined -0.1%, the DAX fell -0.26%, and the CAC 40 finished down -0.62%
- Investor sentiment for European stocks finished trading negative with the advance/decline ratio for the Euro Stoxx 600 currently at 0.55x
- Chemicals (+0.36%), Personal & Household Goods (+0.21%), and Food & Beverage (+0.2%) stocks were the top performers in the Euro Stoxx 600 today
- Oil & Gas (-1.46%), Telecommunications (-1%), and Travel & Leisure (-0.96%) stocks were the worst performers in the Euro Stoxx 600 today
- 21 stocks in the Euro Stoxx 600 hit 4-week highs while 193 stocks closed at 4-week lows
- 5 stocks in the Euro Stoxx 600 finished the trading session overbought while 160 stocks closed oversold according to the 16-day RSI Measure
- VSTOXX, the European stocks equivalent of the VIX, closed moving higher 0.57 points today to 19.35 after closing at 18.78 last week
Stocks Trending in the News
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- CropEnergies (CE2 GR) cut its forecast for operating profit for the full year to 15-35 million euros, down from 25-55 million euros. CropEnergies now expects full-year revenue of 750-780 million euros, down from 810-860 million euros. CropEnergies issued a profit warning, saying “due to difficult market conditions, CropEnergies will halt production in its plant in Wilton, UK from the end of November, 2018 on.” CropEnergies closed 6.5% lower at 4.19 euros. CropEnergies is not rated in our Global Top Stock Ideas.
- Daimler (DAI GR) had its price downgraded today at Bankhaus Metzler to 48 euros from 52 euros while reiterating its sell rating on Daimler in a note published today. Daimler “has often delivered too little earnings momentum” according to the note and the profit warning from Friday was cited as evidence. Daimler's 6% operating profit at Mercedes-Benz “disappointed”, the note went on to explain. Daimler is rated ‘Unattractive’ in our European Large-Cap Global Top Stock Ideas.
- Linde (LIN GR) and Praxair (PX) won approval from the US Justice Department for their USD$46 billion merger. Linde and Praxair together will create an international giant in industrial gases. Linde and Praxair will each sell some assets and the combination will save USD$1.1-1.2 billion per year in expenses. Linde closed 2.8% higher at $217.30. Praxair is trading 1.7% higher at $162.60. Linde is rated ‘Top Buy’ in our European Large-Cap Global Top Stock Ideas, Praxair is rated ‘Neutral’ in our US Large-Cap Global Top Stock Ideas.
What is Going on with European Currencies?
- EUR€ is currently down -0.469% against the USD$ to 1.146
- GBP£ is currently down -0.864% against the USD$ to 1.2963
- CHF is currently little changed against the USD$ at 1.0027
Highlights from the European Bond Market
- Generic Euro 10-Year Bonds are higher with yields down -1.2 basis points to 0.448%
- German 10-Year Bunds are higher with yields down -1.2 basis points to 0.448%
- French 10-Year Government Bonds are higher with yields down -1.9 basis points to 0.821%
- UK 10-Year GILTs are higher with yields down -4.9 basis points to 1.527%
- Italian 10-Year Government Bonds are lower with yields up 0.7 basis points to 3.49%
Euro Stoxx 50 Movers
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