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European stocks close flat, weak German factory orders dampens sentiment

Feb 06, 2019

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

European Markets

  • European stocks moved little today, remaining in a tight range for the entire session with weak German economic data dampening sentiment
  • The Euro Stoxx 600 closed up +0.15%, the FTSE 100 declined -0.06%, the DAX fell -0.38%, and the CAC 40 finished down -0.08%
  • Germany factory orders dropped 1.6% M/M in December, the sharpest drop in 6 months.  Market forecasts were for a +0.3% increase.  The decline in factory orders, coupled with other soft economic data points, suggests the Germany economy, the largest in Europe, is experiencing a deceleration in economic growth.
  • Iron ore prices have hit a 2-year high as the effects of the Vale (VALE) dam disaster and production interruptions continue to be felt 
  • According to Investors Intelligence (II), bullish stocks newsletter writers have risen for the 5th straight week, the longest streak since late August/early September.  Currently, the number of bullish newsletter sites at 48.6%.  II only begins to worry about “too much optimism” after number breaks above 50.05%.
  • Investor sentiment for European stocks finished trading negative with the advance/decline ratio for the Euro Stoxx 600 currently at 0.94x
  • The price ratio of Gold (per ounce) vs the S&P 500 is beginning to recover from levels last seen in 2007.  Rising US debt (as a % of GDP), as well as the global trend of rising debt, appears to be fueling demand for gold.
  • Technology (+1.9%), Banks (+1.02%), and Basic Resources (+0.58%) stocks were the top performers in the Euro Stoxx 600 today
  • Personal & Household Goods (-0.94%), Media (-0.62%), and Chemicals (-0.49%) stocks were the worst performers in the Euro Stoxx 600 today
  • 222 stocks in the Euro Stoxx 600 hit 4-week highs while 10 stocks closed at 4-week lows
  • 75 stocks in the Euro Stoxx 600 finished the trading session overbought while 2 stocks closed oversold according to the 16-day RSI Measure
  • VSTOXX, the European stocks equivalent of the VIX, closed little changed +0.04 points today to 13.62 after closing at 13.58 yesterday

Stocks Trending in the News

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  • Allstate (ALL) reported fourth quarter adjusted EPS of USD$1.24 beating consensus of USD$1.10. Allstate fiscal first quarter combined ratio came at 97% matching consensus.  Allstate is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.
  • Boston Scientific Corp. (BSX) announced CY4Q2018 adjusted EPS of USD$0.39 beating consensus of USD$0.36.  Boston Scientific Corp. reported revenue of USD$2.56 billion in CY4Q2018 while analysts expected USD$2.5 billion. Boston Scientific Corp. sees FY2019 adjusted EPS between USD$1.53 and USD$1.58. Boston Scientific Corp. is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas. 
  • Cognizant Technology Solutions (CTSH) announced CY4Q2018 adjusted EPS of USD$ while consensus was for USD$1.07. Cognizant Technology Solutions reported revenue of USD$ in CY4Q2018 while analysts expected USD$. Cognizant Technology Solutions sees FY2019 adjusted EPS between USD$ and USD$. Cognizant Technology Solutions is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • Cummins Inc. (CMI) announced CY4Q2018 adjusted EPS of USD$3.63 while consensus was for USD$3.81. Cummins Inc. reported revenue of USD$6.13bn in CY4Q2018 while analysts expected USD$6.08bn. Cummins Inc. sees FY2019 revenue growing by between 0% and 4%. Cummins Inc. is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Industrials Global Top Stock Ideas.
  • Daimler (DB: DAI) reported fourth quarter ebit of 2.67 billion versus 3.42 billion euros a year ago.  Daimler fourth quarter revenue came at 46.6 billion euros USD$39.29 billion versus 45.5 billion euros from a year ago.  Daimler is discussing building an electric van with Tesla (TSLA).  Daimler is also talking to Geely Automotive (SEHK:175) about future cooperation.  Daimler is rated “Unattractive” in our European Large-Cap Global Top Stock Ideas.  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.  Geely Automotive is rated “Unattractive” in our China All-Cap Global Top Stock Ideas.
  • Elanco Animal Health Inc. (ELAN) announced CY4Q2018 adjusted EPS of USD$0.29 while consensus was for USD$0.28. Elanco Animal Health Inc. reported revenue of USD$799.3mm in CY4Q2018 while analysts expected USD$800.7mm. Elanco Animal Health Inc. sees FY2019 adjusted EPS of between USD$1.02 and USD$1.12 while analysts expect USD$1.10. Elanco Animal Health Inc. is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Electronic Arts (EA) reported third quarter 2019 adjusted EPS of USD$1.93 matching consensus of USD$1.93.  Electronic Arts third quarter 2019 revenue came at USD$1.61 billion trailing consensus of USD$1.75 billion.  Electronic Arts gave EPS guidance for the coming quarter of USD$ 0.90, well below consensus of USD$1.59 with revenue of USD$1.17 while consensus is for USD$1.47 billion.  Electronic Arts is rated “Unattractive” in our US SMID-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas.
  • Eli Lilly & Co. (LLY) announced CY4Q2018 adjusted EPS of USD$1.33 matching consensus of USD$1.34. Eli Lilly & Co. reported revenue of USD$6.44 billion in CY4Q2018 while analysts expected USD$6.29 billion. Eli Lilly & Co. sees FY2019 adjusted EPS between USD$5.55 and USD$5.65. Eli Lilly & Co. is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.
  • First Data Corp. (FDC) announced CY4Q2018 adjusted EPS of USD$0.38 that matched its preliminary reported adjusted EPS of USD$0.38 on January 16th. First Data Corp. Sees its FY2019 adjusted EPS between USD$1.55 and USD$1.58, the midpoint of which slightly misses consensus of USD$1.58. First Data Corp. is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas.
  • General Motors Co. (GM) announced CY4Q2018 adjusted EPS of USD$1.43 while consensus was for USD$1.25. General Motors Co. reported revenue of USD$38.40bn in CY4Q2018 while analysts expected USD$36.53bn. General Motors Co. maintained FY2019 adjusted EPS guidance between USD$6.50 and USD$7.00 while consensus was for USD$6.27. General Motors Co. is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.
  • Gilead Sciences (GILD) reported fourth quarter adjusted EPS of USD$1.44 missing consensus of USD$1.70.  Gilead Sciences fourth quarter revenue came at USD$5.8 billion beating consensus of USD$5.52 billion.  Gilead Sciences raised its quarterly dividend to 63 cents, up from 57 cents, and above 62 cents expected.  Gilead Sciences is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Humana Inc. (HUM) announced CY4Q2018 adjusted EPS of USD$2.65 beating consensus of USD$2.52. Humana Inc. reported revenue of USD$14.17 billion in CY4Q2018 while analysts expected USD$13.97 billion. Humana Inc. sees FY2019 adjusted EPS of between USD$17 and USD$17.50 while analysts expect USD$. Humana Inc. is rated “Attractive” in our US Large-Cap Global Top Stock Ideas. 
  • Immunomedics Inc. (IMMU) announced FY2Q2019 adjusted loss per share of USD$ while consensus was for USD$0.34. Immunomedics reported revenue of USD$ in FY2Q2019 while analysts expected USD$. Immunomedics sees FY2019 adjusted EPS of between USD$ and USD$ while analysts expect USD$. Immunomedics is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.
  • ING Groep NV (ENXTAM: INGA) shared traded higher after the company announced it may move some offices due to Brexit. The Amsterdam-based financial institution is considering relocating dozens of London positions back to the European continent. CEO Ralph Hamers told reporters on Wednesday, “What regulators are thinking -- depending on how Brexit will be negotiated -- is that European banks do need some kind of a risk control on the continent for their euro business.” ING Groep is rated “Top Short” in our European Large-Cap Global Top Stock Ideas.
  • Jacobs Engineering Group Inc. (JEC) announced FY1Q2019 adjusted EPS of USD$1.14 while consensus was for USD$1.03. Jacobs Engineering Group reported revenue of USD$3.08bn in FY1Q2019 while analysts expected USD$3.82bn. Jacobs Engineering Group sees FY2019 adjusted EPS of between USD$5.10 and USD$5.50, the midpoint of which edges past analyst expectations of USD$5.15. Jacobs Engineering Group is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Industrials Global Top Stock Ideas.
  • The New York Times Co. (NYT) announced CY4Q2018 adjusted EPS of USD$0.32 while consensus was for USD$0.28. The New York Times reported revenue of USD$502.7mm in CY4Q2018 while analysts expected USD$479.5mm. The New York Times is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • Regeneron Pharmaceuticals Inc. (REGN) announced CY4Q2018 adjusted EPS of USD$6.84 that largely surpassed consensus of USD$5.61. Regeneron Pharmaceuticals reported revenue of USD$1.93bn in CY4Q2018 while analysts expected USD$1.72bn. Regeneron Pharmaceuticals is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.
  • Sensata Technologies Holdings (ST) announced CY4Q2018 adjusted EPS of USD$0.95 while consensus was for USD$0.99. Sensata Technologies reported revenue of USD$3.58bn in CY4Q2018 while analysts expected USD$3.68bn. Sensata Technologies sees FY2019 adjusted EPS of between USD$3.94 and USD$4.10, the midpoint of which slightly misses consensus of USD$4.05. Sensata Technologies is not rated in our Global Top Stock Ideas.
  • Summit Materials Inc. (SUM) announced CY4Q2018 adjusted loss per share of USD$0.16 while consensus was for an adjusted EPS of USD$0.05. Summit Materials reported revenue of USD$445.1mm in CY4Q2018 while analysts expected USD$489.9mm. Summit Materials sees FY2019 adjusted ebitda of between USD$430mm and USD$470mm, the midpoint of which is in line with consensus of USD$451.2mm. Summit Materials is rated “Top Short” in our US Large-Cap Global Top Stock Ideas.
  • Take-Two Interactive Software (TTWO) shares fell after announcing FY4Q2019 EPS guidance between USD$0.61 and USD$0.71 while consensus was for USD$1.07. Take-Two generated an adjusted EPS of USD$2.90 in FY3Q2019 while consensus was for USD$2.80. Take-Two Interactive Software reported adjusted revenue of USD$1.57bn in F32Q2019 while analysts expected USD$1.52. Take-Two Interactive Software is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • The Walt Disney Co. (DIS) reported fiscal first quarter adjusted EPS of USD$1.84, handily beating consensus of USD$1.54. Disney fiscal first quarter revenue came at USD$15.3 billion beating consensus of USD$15.15 billion by a touch.  Disney's strong broadcast results drove the company's earnings beat.  Walt Disney Co. is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.
  • Twenty-First Century Fox Inc. (FOXA) announced FY2Q2019 adjusted EPS from continuing operations of USD$0.37 while consensus was for USD$0.32. Twenty-First Century Fox reported revenue of USD$8.50bn in FY2Q2019 while analysts expected USD$8.49bn. Twenty-First Century Fox is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.
  • Ubisoft (ENXTPA: UBI) shares tanked after competitors Electronic Arts (EA) and Take-Two Interactive Software (TTWO) reported weaker than expected earnings. Video game makers across the globe are attributing lagging performance to the unprecedented success of Fortnite, a free to play game launched by Tencent’s (SEHK: 700) Epic Games. Ubisoft is rated “Attractive” in our European Large-Cap Global Top Stock Ideas. Electronic Arts is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas. Take-Two is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas. Tencent is rated “Attractive” in our China All-Cal Global Top Stock Ideas.

What is Going on with European Currencies?

  • EUR€ is currently down -0.316% against the USD$ to 1.137
  • GBP£ is currently little changed against the USD$ at 1.295
  • CHF is currently down -0.21% against the USD$ to 0.998

Highlights from the European Bond Market

  • Generic Euro 10-Year Bonds are higher with yields down -0.8 basis points to 0.162%
  • German 10-Year Bunds are higher with yields down -0.8 basis points to 0.162%
  • French 10-Year Government Bonds are higher with yields down -0.4 basis points to 0.577%
  • UK 10-Year GILTs are higher with yields down -1.6 basis points to 1.216%
  • Italian 10-Year Government Bonds are lower with yields up 6.6 basis points to 2.86%
  • Spanish 10-Year Government Bonds are lower with yields up 0.1 basis points to 1.257%

 

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Euro Stoxx 50 Movers

In local currency.
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Outperformers Sector Price 1D % Chg Volume
ING Groep NV Consumer Discretionary 11.1 6.12%            36,963,239
ASML Holding NV Health Care 164 3.40%               1,786,487
Intesa Sanpaolo SpA Industrials 2.04 2.39%          163,681,812
CRH PLC Telecommunication Services 26.8 2.29%               2,192,945
BNP Paribas SA Financials 41.9 1.77%               6,311,587
 
Underperformers Sector Price 1D % Chg Volume
Daimler AG Consumer Staples 52 -1.81%               6,234,132
Safran SA Industrials 115 -1.50%                  772,029
Kering SA Consumer Staples 445 -1.44%                  226,333
Linde PLC Real Estate 144 -1.34%                  562,924
L'Oreal SA Health Care 217 -1.23%                  534,654
Global Top Stock IdeasTOP LONG & TOP SHORT STOCK IDEAS FOR GLOBAL MARKETSMONTHLY TOP IDEAS FROM OUR MULTI-FACTOR QUANTITATIVE MODELS
Global Top Stock IdeasTOP LONG & TOP SHORT STOCK IDEAS FOR GLOBAL MARKETSMONTHLY TOP IDEAS FROM OUR MULTI-FACTOR QUANTITATIVE MODELS