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Show me the way...European stocks end the week flat with mixed earnings failing to give direction

Apr 26, 2019

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scroll down for the Asian markets recap

International Stock Markets Indexes

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

European Markets Recap

  • European stocks post slight gains to end the week, earnings reports for the week were a mixed bag
  • The Euro Stoxx 600 closed up +0.22%, the FTSE 100 declined -0.08%, the DAX rose +0.27%, and the CAC 40 finished up +0.21%
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  • Investor sentiment for European stocks finished trading positive with the advance/decline ratio for the Euro Stoxx 600 currently at 1.67x
  • Media (+1.74%), Telecommunications (+1.05%), and Automobiles & Parts (+0.93%) stocks were the top performers in the Euro Stoxx 600 today
  • Oil & Gas (-1.46%), Basic Resources (-0.95%), and Technology (-0.48%) stocks were the worst performers in the Euro Stoxx 600 today
  • 108 stocks in the Euro Stoxx 600 hit 4-week highs while 48 stocks closed at 4-week lows
  • 100 stocks in the Euro Stoxx 600 finished the trading session overbought while 11 stocks closed oversold according to the 16-day RSI Measure
  • VSTOXX, the European stocks equivalent of the VIX, closed  down -1.05 points today to 11.91 after closing at 12.96 yesterday
  • EUR€ is currently up +0.18% against the USD$ to 1.1152

Asian Stock Markets Indexes

Asian Markets Recap

  • While addressing a meeting of 40 world leaders at its "Belt and Road" forum in Beijing, President Xi listed all the reform efforts China is undertaking at home, in a speech seemingly aimed directly at President Trump as they all top the list of his demands of Chinese reforms
  • President Xi, at the same forum, said there will be a "new direction" for the country's "Belt & Road" initiative amid complaints of rampant corruption and heavy debt for countries in which projects take place
  • President Abe of Japan is meeting with President Trump today in Washington as the two seek to forge deeper trade ties in a number of areas
  • The Nikkei 225 finished down --0.22%, the Hang Seng ended up +0.19%, the Hang Seng China Enterprise up +0.08%, and the CSI 300 was -1.33%
  • Investor sentiment for Japanese stocks finished negative with the advance/decline ratio for the Nikkei 225 closing at 0.58x
  • 15 stocks in the Nikkei 225 hit 4-week highs while 45 stocks reached 4-week lows
  • 10 stocks in the Nikkei 225 closed overbought while 4 stocks closed oversold according to the 16-day RSI Measure
  • Investor sentiment for Hong Kong stocks finished positive with the advance/decline ratio for the Hang Seng closing at 1.27x
  • 3 stocks in the Hang Seng hit 4-week highs while 13 stocks reached 4-week lows
  • 1 stock in the Hang Seng closed overbought while 2 stocks closed oversold according to the 16-day RSI Measure

Stocks Trending in the News

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Global Consumer Stocks Trending in the News

  • Archer-Daniels Midland (AMD) reported first quarter earnings well below expectations.  ADM reported first quarter EPS of 46 cents, missing the 60 cents consensus.  First quarter revenue of $15.3 billion missed the $15.59 billion consensus.  ADM said it will create a new ethanol subsidiary to allow it more options, such as a spin-off, for that business unit.  ADM will be offering early retirement to some employees in the US and Canada.   ADM is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Staples Global Top Stock Ideas
  • Amazon (AMZN) delivered first quarter earnings well above consensus.  Amazon delivered first quarter EPS of $7.09 while consensus was $4.67.  Amazon net sales in the first quarter were $59.7 billion, matching consensus.  Amazon reported AWS sales of $7.7 billion, posting 41% y/y growth, matching consensus of $7.67 billion.  Amazon gave 2Q sales guidance of $59.5 billion to $63.5 billion.  Amazon is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.
  • Colgate-Palmolive (CL) posted first quarter earnings and revenue in line.  Colgate-Palmolive first quarter adjusted EPS of 67 cents came in line with 66 cents consensus.  Revenue in the first quarter of $3.88 billion matched $3.86 billion.  Colgate-Palmolive reiterated full year guidance of 2% to 4% organic sales growth with net sales growth flat to slight growth.  Colgate-Palmolive is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Staples Global Top Stock Ideas
  • Daimler (DB:DAI) reported first quarter results that matched consensus.  Daimler posted first quarter ebit of 2.80 billion euros while consensus was 2.78 billion.  Total sales of 39.7 billion euros came a touch ahead of 39.28 billion euros.  Daimler first quarter profit was 2.15 billion euros.  Analysts comment that this should be the worst quarter of 2019 as Daimler consider laying off up to 10,000 jobs.  Daimler is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas
  • Ford Motor Co (F) reported earnings that beat consensus, bearing fruit from its turnaround efforts.  Ford reported first quarter adjusted EPS of 44 cents, ahead of the 26 cents expected.  Revenue in the first quarter of $37.2 billion beat the $36.99 consensus.  Ford is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.
  • Goodyear Tire & Rubber (GT) report better than expected earnings.  Goodyear first quarter adjusted EPS of 19 cents came well ahead of 6 cents consensus.  Revenue of $3.6 billion missed $3.71 billion consensus.  Goodyear saw weakness in its Asian business.   Goodyear Tire & Rubber is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas
  • Mattel (MAT) posted first quarter sales and earning that beat consensus handily.   Mattel reported first quarter adjusted loss of 44 cents per share, better than the 58 cents per share loss expected.  Revenue in the first quarter of $689.2 million beat the $648 million consensus.  Barbie and Hot Wheels saw strong sales growth.  Mattel is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • Target (TGT) shares slid after analysts praised Amazon’s (AMZN) announcement that it would begin to offer 1-day shipping to its Prime subscribers. Target fell as much as 8% on the news while Walmart (WMT) slipped nearly 4%. Amazon previously offered 2-day shipping for its Prime subscribers, which many analysts saw as a catalyst for driving sales. Target is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas. Amazon is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas. Walmart is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Staples Global Top Stock Ideas.

Global Information Technology Stocks Trending in the News

  • Intel (INTC) reported earnings in line and slashed guidance.  Intel reported first quarter adjusted EPS of 89 cents, ahead of87 cents expected.  Revenue in the first quarter of $16.1 billion came in line with $16.03 consensus.  Intel gave second quarter EPS guidance of about 89 cents and sees full year EPS about $4.35, a cut from $4.60 previously.  Intel is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.
  • PayPal (PYPL) said it will invest $500 million in the Uber (UBER) IPO.  Uber said it lowered its target valuation to $80 billion to $90 billion, down from $100 billion.  Uber is seeking to raise $9 billion in its IPO.  If successful, Uber’s IPO will rank in the top 10 of all time.  PayPay is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas.

Global Financials Stocks Trending in the News

  • Capital One Financial (COF) reported earnings and revenue that beat consensus.  Capital One reported first quarter adjusted EPS of $2.90, ahead of $2.70 expected.  Revenue in the first quarter of $7.1 billion beat the $7.03 billion consensus.  Capital One Financial is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Royal Bank of Scotland Group Plc (LSE: RBS) shares slid after the state-backed lender announced that it is feeling the effects of the UK’s slowing economy on its bottom-line net income. Royal Bank of Scotland’s caution eclipsed the firm’s operating profit before tax of 1.01 billion pounds ($1.3 billion) in the first quarter, which topped analyst expectations.  Royal Bank of Scotland is rated “Neutral” in our United Kingdom All-Cap Global Top Stock Ideas.

Global Power & Commodity Stocks Trending in the News

  • ExxonMobil (XOM) reported first quarter earnings that missed expectations.  ExxonMobil first quarter EPS of 55 cents missed 72 cents consensus.  ExxonMobil total production of 3.98 mboe/d, in line with 4.01 mboe/d consensus.  ExxonMobil suffered weak prices in both the oil and natural gas markets as compared with the previous quarter.  ExxonMobil has total capital expenditures of $6.89 billion in the first quarter.  ExxonMobil is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas
  • Ferrexpo Plc (LSE: FXPO) shares tanked by 25% after the auditor assigned to the company resigned amid a money laundering investigation into a charity backed by the company. The auditor’s reassignment, which came without reason, shortly follows a dispute between the auditor and Ferrexpo’s board of directors over the role of Kostyantin Zhevago in the charity, who is sales Ferrexpo’s majority shareholder and CEO. Ferrexpo is rated “Neutral” in our United Kingdom All-Cap Global Top Stock Ideas.
  • Glencore Plc (LSE:GLEN) is under investigation by the Commodities Futures Trading Commission for possible corrupt practices.  Glencore is being investigated by the US Justice Department, FBI as well as authorities in Brazil in relation to the “Car Wash” bribery scandal.  Glencore is also being looked at in connection with bribery in Nigeria.  Glencore is rated “Neutral” in our European Large-Cap Global Top Stock Ideas and “Unattractive” in our United Kingdom All-Cap Global Top Stock Ideas
  • Just Eat Plc (LSE: JE) shares fell despite offering a FY2019 revenue forecast that was in-line with analyst estimates and its prior forecasts. Just Eat maintained guidance for FY2019 revenue between 1.0 billion pounds and 1.1 billion pounds, the midpoint of which matches analyst expectations for 1.05 billion pounds in revenue. Just Eat observed 28% y/y revenue growth and a 21% y/y increase in orders during the first quarter. Just Eat is rated “Neutral” in our United Kingdom All-Cap Global Top Stock Ideas.

Global Industrial Stocks Trending in the News

  • American Airlines (AAL) reported first quarter earnings in line.  American reported first quarter EPS if 52 cents while consensus was 51 cents.  American reported first quarter revenue of $10.58 was in line with $10.6 billion consensus.  American gave full year EPS guidance of $4.00 to $6.00, present consensus is $5.61.  This is a huge cut in guidance from the original $5.50 to $7.50.  American Airlines is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Industrials Global Top Stock Ideas
  • Skanska AB (OM: SKA B) shares fell the most intraday since February after the company announced first quarter operating profit that fell short of the lowest analyst estimate. Skanska generated operating profit of SEK488 million in the first quarter short of analyst estimates that ranged between SEK549 million and SEK1.12 billion.  Skanska is rated “Attractive” in our European SMID-Cap Global Top Stock Ideas.
  • Mitsubishi Electric (TSE: 6503) shares tumbled after the company announced fiscal year guidance that came in 3.5% below the average analyst forecast. Mitsubishi Electric expects operating income of 295 billion yen in fiscal year, below consensus for 305.70 billion yen. Mitsubishi Electric reported fiscal fourth quarter operating income of 89.04 billion yen that beat consensus for 85.84 billion yen. Mitsubishi Electric is rated “Neutral” in our Japan Large-Cap Global Top Stock Ideas.

 

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