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European stocks post modest gains with building positive sentiment on trade talks

Feb 13, 2019

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

European Markets

  • European stocks posted modest gains, rising for the third day and closing at the highest level since November on positive trade sentiment
  • The Euro Stoxx 600 closed up +0.6%, the FTSE 100 advanced +0.81%, the DAX rose +0.37%, and the CAC 40 finished up +0.35%
  • Oil continues to rally in the wake of Saudi Arabia's additional production cuts with WTI crude above $54, last quoted at $54.23
  • Well over USD$30 billion has flowed into emerging markets stocks over the past 17 weeks, read more about comparative valuations in our blog post As Investors Continue to Favor Emerging Markets over Developed Markets, which Sectors Look Attractive? (click to read)
  • Stocks newsletter writers classified as “bullish” by Investors Intelligence (II) has crept up to 49.5% (from 48.6% last week).  Optimism among newsletter writers has been climbing for 6 straight weeks, the longest streak since late November/December 2016.  Typically, II views 50% as the level where it becomes worried about too much “newsletter optimism”. 
  • Investor sentiment for European stocks finished trading positive with the advance/decline ratio for the Euro Stoxx 600 currently at 2.33x
  • Basic Resources (+1.97%), Travel & Leisure (+1.53%), and Technology (+1.35%) stocks were the top performers in the Euro Stoxx 600 today
  • Real Estate (-0.47%), Utilities (-0.25%), and Retail (-0.04%) stocks were the worst performers in the Euro Stoxx 600 today
  • 92 stocks in the Euro Stoxx 600 hit 4-week highs while 21 stocks closed at 4-week lows
  • 31 stocks in the Euro Stoxx 600 finished the trading session overbought while 7 stocks closed oversold according to the 16-day RSI Measure
  • VSTOXX, the European stocks equivalent of the VIX, closed little changed -0.31 points today to 13.97 after closing at 14.28 yesterday

Stocks Trending in the News

Click name for Q-Factor score and financial data

  • Activision Blizzard (ATVI) reported fourth quarter adjusted EPS of USD$1.29 matching consensus of USD$1.29.  Activision Blizzard reported fourth quarter total sales of USD$2.84 billion missing consensus of USD$3.04 billion.  Activision Blizzard said first quarter 2019 EPS will come around 20 cents, well below 47 cents consensus.  Its dividend was raised to 37 cents per share from 34 cents.  Activision Blizzard announced a restructuring that will see it cut 8% of its workforce.  Activision Blizzard is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • Akamai Technology (AKAM) reported fourth quarter adjusted EPS of USD$1.07 beating consensus of USD$1.00.  Akamai Technology reported fourth quarter revenue of USD$713 million beating consensus of USD$703.9 million.  Akamai Technology said Ed McGowan will succeed Jim Benson as CFO.  Akamai Technology is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.
  • Asos Plc (AIM: ASC) and Boohoo Group Plc (AIM: BOO) shares were downgraded at Bank of America Merrill Lynch, citing lack of benefit from the trend towards online shopping. Asos was downgraded from natural to underperform at Bank of America Merrill Lynch while Boohoo was downgraded from buy to neutral. Asos is rated “Neutral” in our United Kingdom All-Cap Global Top Stock Ideas. Boohoo is rated “Attractive” in our United Kingdom All-Cap Global Top Stock Ideas.
  • Black Knight Inc. (BKI) announced adjusted EPS in CY4Q2018 of USD$0.50 that beat consensus of USD$0.47. Black Knight observed 6.4% y/y revenue growth to USD$285.6mm in CY4Q2018, in line with analyst expectations. Black Knight is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas.
  • Clariant (SWX: CLN) announced CY4Q2018 financials that somewhat miss analyst estimates. Clariant generated CHF1.63bn of sales in CY4Q2018 while analysts expected CHF1.73bn. Clariant reported adjusted Ebitda for FY2018 of CHF1.02bn, matching consensus of CHF1.02bn. Clariant is rated “Top Short” in our European Large-Cap Global Top Stock Ideas.
  • Dish Network Corp. (DISH) announced CY4Q2018 financials that came in line with analyst expectations. Dish Network reported revenue of USD$3.31bn in CY4Q2018, slightly edging past consensus of USD$3.28bn. Dish Network’s EPS in CY4Q2018 of USD$0.64 came slightly below consensus of USD$0.67. Dish Network is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • Global Payments Inc. (GPN) announced FY2019 guidance that slightly misses analyst consensus estimates. Global Payments sees FY2019 adjusted EPS between USD$5.90 and USD$6.10, the midpoint of which is slightly below consensus of USD$6.03. Global Payments expects FY2019 adjusted net revenue between USD$4.43bn and USD$4.49bn. Global Payments is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.
  • Hilton Worldwide (HLT) reported fourth quarter adjusted EPS of USD$0.79 beating consensus of USD$0.69.  Hilton Worldwide reported fourth quarter revenue of USD$2.29 billion in line with consensus of USD$2.26 billion.  Hilton Worldwide see first quarter 2019 EPS USD$0.73-0.78.  Hilton Worldwide is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.
  • Interpublic Group of Cos Inc. (IPG) reported adjusted EPS in CY4Q2018 that beat the highest analyst estimates. Interpublic Groupo announced CY4Q2018 adjusted EPS of USD$0.89, beating the highest analyst estimates that ranged between USD$0.75 and USD$0.82. Interpublic Group reported revenue of USD$2.86bn in CY4Q2018, surpassing consensus of USD$2.33bn. Interpublic Group is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.
  • Kion Group AG (XTRA: KGX) shares traded higher after a note from Metzler Capital Markets says the company may have had strong order intake and accelerated sales growth in CY4Q2018. Metzler Capital Markets also upgraded Kion from hold to buy while increasing its price target from 49 euros/share to 61 euros/share. Kion is rated “Neutral” in our European SMID-Cap Global Top Stock Ideas.
  • Molson Coors Brewing Co. (TAP)  was downgraded by Deutsche Bank to hold from buy.  The downgrade comes in the wake of the announcement that it is restating its financial statements from 2016 and 2017.   Molson Coors Brewing Co. found errors in accounting when preparing 2018 statements.  The errors were related to deferred tax liabilities for partnerships in Miller Coors.  Molson Coors Brewing is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Staples Global Top Stock Ideas.
  • Occidental Petroleum (OXY) reported fourth quarter core EPS of USD$1.22 beating consensus of USD$1.14.  Occidental Petroleum reported fourth quarter total sales of USD$4.76 billion matching consensus of USD$4.7 billion.  Occidental Petroleum is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.
  • Osram Licht AG (XTRA: OSR) shares popped in German trading following reports that buyout firms Bain Capital and Carlyle Group LP (CG) are partnering to make an offer for the lighting manufacturer. According to people familiar with the matter, a bid could come by the end of March if the buyout firms decide to take Osram Licht AG private. Osram Licht AG is rated “Top Short” in our European Large-Cap Global Top Stock Ideas. Carlyle Group is rated “Neutral” in our US SMID-Cap Global Top Stock Ideas.
  • Trip Adviser (TRIP) reported fourth quarter adjusted EPS of USD$0.27 missing consensus of USD$0.28.  Trip Adviser reported fourth quarter revenue of USD$346 million beating consensus of USD$342.8 million.   Trip Adviser is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.
  • Tullow Oil (LSE: TLW) shares rose to their highest levels since November after the company announced a FY2018 dividend of USD$0.048/share, surprising Stifel’s estimates for USD$0.025/share. Stifel called the dividend a surprising move to reassure investors in a note to clients. UBS analyst Amy Wong wrote in a note to clients that analyst consensus had yet to factor in a dividend for FY2018, so it should be a positive for shareholders. Tullow Oil is rated “Top Short” in our United Kingdom All-Cap Global Top Stock Ideas.
  • Twilio (TWLO) reported fourth quarter adjusted EPS of USD$0.04 matching consensus of USD$0.04.  Twilio reported fourth quarter revenue of USD$204.3 million beating consensus of USD$184.5 million.  Hilton Worldwide see first quarter 2019 EPS USD$0.00-0.01, below 2 cents expected.  Twilio is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Unattractive” in our US Information Technology Global Top Stock Ideas.
  • Under Armour (UAA) reported fourth quarter adjusted EPS of USD$0.09 beating consensus of USD$0.04.  Under Armour reported fourth quarter revenue of USD$1.39 billion in line with consensus of USD$1.38 billion.  Under Armour reported a 12% drop in inventory and indicated first quarter sales will be flat, below 2% consensus.  Under Armour is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • Wyndham Hotel (WH) reported fourth quarter adjusted EPS of USD$0.58 beating consensus of USD$0.56.  Wyndham Hotel reported fourth quarter revenue of USD$527 million beating consensus of USD$497.4 million.  Wyndham Hotel hiked its dividend to 29 cents from 25 cents.  Wyndham Hotel is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas

What is Going on with European Currencies?

  • EUR€ is currently down -0.327% against the USD$ to 1.1289
  • GBP£ is currently down -0.217% against the USD$ to 1.2864
  • CHF is currently little changed against the USD$ at 0.9929

Highlights from the European Bond Market

  • Generic Euro 10-Year Bonds are higher with yields down -0.9 basis points to 0.123%
  • German 10-Year Bunds are higher with yields down -0.9 basis points to 0.123%
  • French 10-Year Government Bonds are higher with yields down -1.4 basis points to 0.551%
  • UK 10-Year GILTs are higher with yields down -0.3 basis points to 1.182%
  • Italian 10-Year Government Bonds are higher with yields down -6 basis points to 2.784%
  • Spanish 10-Year Government Bonds are higher with yields down -0.5 basis points to 1.234%

 

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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 480 3.05%                  465,370
Nokia OYJ Financials 5.57 2.43%            18,464,009
Anheuser-Busch InBev SA/NV Energy 69 2.18%               2,129,825
Amadeus IT Group SA Materials 67 1.82%                  734,208
Daimler AG Consumer Staples 50.2 1.69%               3,404,835
 
Underperformers Sector Price 1D % Chg Volume
Sanofi Consumer Discretionary 73.9 -2.18%               2,941,715
Banco Bilbao Vizcaya Argentaria SA Information Technology 5.1 -1.92%            19,557,997
Unibail-Rodamco-Westfield Telecommunication Services 152 -1.49%                  546,285
adidas AG Financials 199 -1.22%                  542,197
Societe Generale SA Energy 24.3 -0.94%               4,966,625
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