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European stocks post modest gains today to close worst year in a decade

Dec 31, 2018

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*Data in Price Return and Updated Real-Time (with a delay), Source: StockDio

European Markets

  • The Euro Stoxx 600 lost 5.5% in December and 13% for the year, posting losses in 8 of the 12 months in 2018; its worst performance since 2008
  • The FTSE100 ended the year 12% down, its worst year since 2008
  • Oil is flat with WTI trading at $45.30 on its way to the first annual price decline since 2015
  • The Euro Stoxx 600 closed up +0.42%, the FTSE 100 declined -0.09%, the DAX rose +1.71%, and the CAC 40 finished up +1.11%
  • US President Donald Trump tweets that negotiations between US and Chinese trade officials are “moving along well” with "big progress” towards a comprehensive trade deal between the world’s two largest economies 
  • Emerging Markets ETFs experienced their 11th straight week of inflows with USD$300.9 million flowing into emerging markets stocks ETFS
  • Investor sentiment for European stocks finished trading negative with the advance/decline ratio for the Euro Stoxx 600 currently at 0.67x
  • Travel & Leisure (+1.07%), Retail (+0.77%), and Utilities (+0.73%) stocks were the top performers in the Euro Stoxx 600 today
  • Telecommunications (+0.14%), Oil & Gas (+0.15%), and Health Care (+0.2%) stocks were the worst performers in the Euro Stoxx 600 today
  • 4 stocks in the Euro Stoxx 600 hit 4-week highs while 26 stocks closed at 4-week lows
  • 3 stocks in the Euro Stoxx 600 finished the trading session overbought while 37 stocks closed oversold according to the 16-day RSI Measure
  • VSTOXX, the European stocks equivalent of the VIX, did not trade today
     

Stocks Trending in the News

Click name for Q-Factor score and financial data

  • Aflac (AFL) said it will enter reinsurance agreements on certain products with Singapore Life.  Aflac will make an initial USD$20mn minority investment in the concern as Aflac seeks to enter new markets.  Aflac describes the venture as a good example of its ability to leverage digital technology to enter new markets.  Aflac is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.
  • Amazon (AMZN) is making a big push in India to train shoppers on using its website.  Amazon has added Hindi and videos to its ordering screen to help residents on the Indian countryside, according to a report in the Wall Street Journal today.   Amazon is also adding small stores where shoppers can learn and a fleet of local delivery people what can accept payment when delivering.  Amazon is focused on the interior in Indian where 800 million people live and often d not have access to a retailer.  Amazon is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.
  • Canada Goose (TSX: GOOS) opened its first store in China this past Friday.  The store is located in Shanghai and has seen heavy crowds since its opening.  This despite the diplomatic tension between Canada and China after Canada detained a Huawei executive at the US’s request.  Canada Goose is not rated in our Global Top Stock Ideas.
  • Distribuidora Internacional de Alimentacion SA (BME: DIA) has executed a series of agreements following the company obtaining the last pending approval from a financial institution. The agreements will grant DIA will access to additional short-term financing of 215mm euros and 682mm euros of financing through working capital financial instruments. DIA is rated “Top Short” in our European SMID-Cap Global Top Stock Ideas
  • Facebook’s (FB) recent data scandal has brought many criticisms of inaction at the Federal Trade Commission, according to a New York Times report today.  Facebook was not responsible for consultant’s misuse of Facebook user data, the Commission rules, rankling many proponents of stronger data protection rules.  Facebook is rated is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.
  • Jet Airways Limited (BSE: 532617) is reportedly in talks with the State Bank of India pertaining to a short-term 15bn rupee loan to meet working capital needs and current payment obligations. Reports by Press Trust of India highlights that Jet Airway’s partner Etihad may guarantee the loan. Jet Airways is rated “Top Buy” in our India All-Cap Global Top Stock Ideas.
  • Nissan’s (TSE: 7201) ousted chairman Carlos Ghosn will remain in jail until January 19th as prosecutors won more detention time for him.  Mr. Ghosn has been detained since November 19th for alleged financial crimes related to his personal finances.  Nissan is rated “Top Buy” in our Japan Large-Cap Global Top Stock Ideas.
  • Standard Chartered (LSE: STAN) Bank Hong Kong will charge a minimum brokerage fee of HK$50 for its Hong Kong securities trading service while maintaining its previous brokerage fee of 0.2%. The policy will reportedly have the largest impact on day traders. Standard Chartered Bank Hong Kong is rated “Unattractive” in our United Kingdom All-Cap Global Top Stock Ideas. 
  • Tencent (TCEHY, SEHK: 700) was not the beneficiary of any approval for video games as China published approval for 80 new games titles.  China’s State Administration of Press, Publication, Radio, Film, and Television published the approvals online today.  China suspended approval of all new games earlier this year throwing a cloud of uncertainty over the sector.  Tencent Amazon is rated “Neutral” in our China All-Cap Global Top Stock Ideas.
  • Tesla (TSLA) CEO Elon Musk will visit China in 2019 for the inauguration of Tesla’s production facility there.  Tesla’s factory is known as Gigafactory 3 and is located in Shanghai.  Elon Musk tweeted that he would be in China soon for the event without giving a date.  Tesla is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • Vodafone (LSE: VOD) Ukraine will begin offering its customers free delivery of LTE-supporting USims. The promotion will last until February 18th, 2019 and will require customers to register on the corporate online site of Vodafone. Vodafone is rated “Unattractive” in our United Kingdom All-Cap Global Top Stock Ideas. 
     

What is Going on with European Currencies?

  • EUR€ is currently little changed against the USD$ at 1.1449
  • GBP£ is currently up +0.417% against the USD$ to 1.2752
  • CHF is currently little changed against the USD$ at 1.0172

Highlights from the European Bond Market

  • Generic Euro 10-Year Bonds are flat with yields little changed 0 basis points to 0.242%
  • German 10-Year Bunds are flat with yields little changed 0 basis points to 0.242%
  • French 10-Year Government Bonds are flat with yields little changed 0 basis points to 0.71%
  • UK 10-Year GILTs are lower with yields up 0.8 basis points to 1.277%
  • Italian 10-Year Government Bonds are flat with yields little changed 0 basis points to 2.742%

 

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Euro Stoxx 50 Movers

In local currency.
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Outperformers Sector Price 1D % Chg Volume
Kering SA Consumer Staples 412 3.55%                     87,912
Linde PLC Real Estate 139 3.40%                  593,728
Bayer AG Information Technology 60.6 2.37%               2,286,927
Munich Re Financials 191 2.31%                  383,742
Safran SA Industrials 105 2.23%                  240,481
 
Underperformers Sector Price 1D % Chg Volume
Amadeus IT Group SA Materials 60.8 -0.65%                  327,712
Telefonica SA Financials 7.34 -0.53%               5,356,504
Industria de Diseno Textil SA Materials 22.4 -0.18%               1,680,262
Banco Bilbao Vizcaya Argentaria SA Information Technology 4.64 -0.12%               6,885,185
Eni SpA Utilities 13.7 0.00%            10,186,783
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