Market Update
Germany's Wholesale Price Deflation Deepens, France's Monthly CPI Falls the Most in Three Decades
Bridgette Randall
15 Oct, 2024
London
European markets struggled to hold gains after advancing the previous two sessions as investors reviewed the fresh batch of mixed economic data.
Benchmark indexes in Paris, London, and Frankfurt traded around the flatline, and crude oil prices plunged as much as 5% in London trading.
Industrial production in the Euro Area increased 1.8% from the previous month in August, according to a preliminary report from Eurostat.
On an annual basis, production edged up only 0.1%, driven by a 4.8% decrease in durable consumer goods and a 2.7% fall in intermediate goods.
France's consumer price inflation slowed slightly more than previously estimated in September, according to the statistical agency INSEE.
Monthly consumer price inflation fell 1.2% in September after increasing 0.5% in the previous month, according to France's statistical agency INSEE.
The monthly decline was the largest since the inflation series started in 1990, driven by a 13.5% decline in transportation prices and a 2.2% fall in the prices of services.
On an annual basis, consumer price inflation slowed to an increase of 1.1% in September from a rise of 1.8% in the previous month.
Core inflation, which excludes energy and food prices, also rose at a slower pace of 1.4% in September from a 1.7% increase in August.
Germany's wholesale prices fell at the fastest pace in five months in September, according to a monthly report released by Destatis.
The annual wholesale prices in September fell 1.6%, faster than the decline of 1.1% in August.
The main driver of the decline in wholesale prices was the fall of 14.6% in mineral oil products, 5.8% decline in steel and semi-finished products, and 5.2% decrease in data processing equipment.
Europe Indexes and Yields
The DAX index increased by 0.2% to 19,548.11; the CAC-40 index fell by 0.8% to 7,540.79; and the FTSE 100 index declined by 0.6% to 8,244.90.
The yield on 10-year German bonds edged lower to 2.22%, French bonds inched lower to 2.97%, the UK gilts edged down to 4.19%, and Italian bonds decreased to 3.47%.
The euro edged lower to $1.09; the British pound inched higher to $1.30; and the U.S. dollar strengthened to 86.16 Swiss cents.
Brent crude decreased $3.84 to $73.62 a barrel, and the Dutch TTF natural gas fell by €1.34 to €39.21 per MWh.
Europe Stock Movers
LM Ericsson soared 9.9% to SEK 86.10 after the Swedish telecom equipment maker said net income in the third quarter swung to a profit compared to a loss a year ago.
Moreover, India-based Bharti Airtel also placed a multi-billion-dollar order for 5G wireless telecom equipment.
Oil explorers declined after crude oil prices fell as much as 5% on a report that Israel is not targeting Iran's nuclear and oil infrastructure.
Moreover, China's September imports rose only 0.6%, suggesting weak domestic demand.
BP plc declined 4.7% to 389.0 pence, Shell PLC fell 3.7% to 2,494.88 pence, and TotalEnergies decreased 4.3% to €59.80.
TotalEnergies said its downstream results are expected to decline sharply because of weak refining margins in Europe and other regions.
Tele2 AB increased 1.2% to SEK 112.85, and the company appointed Jean-Marc Harion as president and chief executive officer as of November 10.
Bellway PLC soared 6.6% to 3,256.0 pence after the UK-based home builder made positive comments about the domestic housing market recovery.
China Indexes Extend Losses Amid Fog of Fiscal Measures
Li Chen
15 Oct, 2024
Hong Kong
Benchmark indexes in Hong Kong and mainland China traded down for the second week in a row amid rising uncertainty about the possible fiscal stimulus measures.
The Hang Seng index decreased as much as 3% and the CSI 300 index dropped 1.5% as investors worried that China's fiscal stimulus measures may fall short of expectations.
Chinese politicians and policymakers In a familiar pattern of talking up their commitment to bolster economic growth, followed by piecemeal and symbolic gestures to revive economic growth have dented consumer confidence.
Moreover, finance minister Lan Fo'an hinted at a widely publicized press conference that the country has room to increase its already high debt to finance new fiscal measures.
Any effort to increase the overall national debt will require approval from China's National People's Congress, a rubber stamp parliament with 2,977 representatives.
Market sentiment was also weak after China's exports rose at a slower pace of 2.4% and imports advanced 0.6%, indicating weak domestic demand and growing difficulties of increasing shipment amid higher international trade barriers.
China Stock Movers
The Hang Seng index declined 2.6% to 20,542.95 and the CSI 300 index dropped 1.3% to 3,908.63.
Property stocks declined for the third session in a row on the lack of clarity of the possible fiscal measures.
China Vanke dropped 2.4% to HK $7.01, Longfor Group declined 2.7% to HK $13.14, and China Resources Land fell 1% to HK $26.95.
Banks were also in focus after the latest new loan data fell short of market expectations.
Bank of China decreased 0.5% to HK $3.82, China Construction Bank dropped 0.6% to HK $6.11, and Industrial and Commercial Bank of China eased 1.4% to HK $4.77.
Technology stocks were under pressure ahead of the upcoming earnings season, and leading tech companies extended losses to 20% from the peak on October 4.
Alibaba Group decreased 4% to HK $100.90, Tencent Holdings dropped 3.3% to HK $421.20, and Meituan Holding fell 5.8% to HK $172.90.
India Movers: Adani Power, Easy Trip Planners, HCL Technologies, Reliance Home, Reliance Industries
Arun Goswami
15 Oct, 2024
Mumbai
Stocks in Mumbai struggled after consumer price inflation surpassed the upper end of the RBI's limit, denting the hopes of a rate cut in the imminent future.
The Sensex index decreased by 0.3% to 81,746.14, and the Nifty index fell by 0.3% to 25,044.75.
On the Mumbai stock exchange, 133 stocks traded at their 52-week highs, and 23 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds inched higher to 6.77%, and the Indian rupee eased to 84.06 against the U.S. dollar.
Reliance Home Finance declined 5% to ₹4.75 after the securities regulator SEBI imposed a 625 crore penalty on several executives of the company for alleged financial impropriety and issuing loans to promoters.
Easy Trip Planners declined 2% to ₹33.50, and the company announced a one bonus share for every share held.
The company will fund the bonus share issue of ₹177.2 crore from the current reserves and increase its total paid share capital to ₹354.41 crore.
Adani Power increased 0.9% to ₹640.0 after the Supreme Court reinstated the company's ₹27,000 crore bid to acquire 1,800 MW of KSK Mahandi Power Company.
The debt-laden coal-powered thermal power plant is located in Chattisgarh with an approved production capacity of 3,600 MW.
HCL Technologies increased 1% to ₹1,873.80, and the technology services provider reported a rise in net income in the September quarter.
Revenue increased to ₹29,318 crore from ₹27,037 crore, net income rose to ₹4,237 crore from ₹3,833 crore, and diluted earnings per share advanced to ₹15.61 from ₹14.13 a year ago.
The company revised its fiscal year revenue growth outlook to between 3.5% and 5.0%.
Reliance Industries declined 1% to ₹2,719.50 after the diversified conglomerate reported a decline in profit for the third quarter in a row.
Weak crude oil refining margin negatively impacted the overall results in the quarter.
Revenue decreased slightly from a year ago ₹2.31 lakh crore, and net profit declined 4.8% to ₹16,563 crore.
Reliance Retail Ventures' net profit in the September quarter increased 5.2% to ₹2,935 crore, despite the decline in operating revenue of 3.5% to ₹66,502 crore.
The company opened 464 new stores, increasing its total store count to 18,946 stores. The company added that online sales contributed to 17% of total retail sales as the company continues to scale its online and quick commerce services.
Jio Platforms' revenue in the fiscal second quarter increased 23.4% to ₹6,539 crore, driven by higher monthly revenue per user to ₹191.50.
In the quarter, the company lost a net total of 1.09 crore subscribers, which most analysts attribute to poor quality of telecom and the recent increase in monthly prices in certain telecom circles.
Wall Street Extends Gains Amid Earnings Optimism and Tech Rebound
Alexander Garcia
14 Oct, 2024
Miami
Stock market indexes advanced in Monday's trading as investors remained firmly focused on earnings.
The S&P 500 index gained 0.6% and the Nasdaq Composite advanced 0.8% after the tech rally broadened to consumer cyclicals, healthcare, and transportation.
About 120 companies are set to release their quarterly results this week, including Blackstone, Charles Schwab, American Express, Netflix, P&G, and Abbott.
On the earnings front, Johnson & Johnson, Citigroup, Goldman Sachs, and Bank of America report their quarterly results on Tuesday, and Morgan Stanley, CSX, Las Vegas Sands, and United Airlines report Wednesday.
The S&P 500 index traded at a new high last week, and the index and the Nasdaq Composite advanced for the fifth week in a row amid rising expectations that the Federal Reserve could engineer a soft landing.
Despite record highs, investors are on edge because of the recent jump in crude oil prices, rate path uncertainty, and escalating geopolitical risk in the Middle East.
As of Friday's close, the S&P 500 index has advanced 22.6% and the Nasdaq Composite has jumped 24.2%, excluding dividend reinvestments.
In the week ahead, investors are looking forward to the release of September retail sales and September industrial output on Thursday, followed by September housing starts and building permits Friday.
U.S. Indexes and Treasury Yields
The S&P 500 index increased 0.6% to 5,851.06, the Nasdaq Composite rose 0.7% to 18,477.88, and the Russell 2000 index rose 0.3% to 2,241.18.
The yield on 2-year Treasury notes edged lower to 3.97%, 10-year Treasury notes inched up to 4.11%, and 30-year Treasury bonds inched higher to 4.41%.
WTI crude oil decreased $1.90 to $73.65 a barrel, and natural gas prices edged down 12 cents to $2.51 a thermal unit.
Gold fell by $10.17 to $2,646.71 an ounce, and silver decreased by $0.40 to $31.12.
The dollar index, which weighs the US currency against a basket of foreign currencies, edged higher to 103.19.
U.S. Stock Movers
Boeing declined 1.5% to $148.50 after the aviation company said it plans to cut about 10% of its staff, or about 17,000 jobs.
The company also estimated third quarter revenue of $17.8 billion, GAAP loss per share of $9.97, and operating cash outflow of $1.3 billion.
The company also announced a $3 billion charge related to its 777x and 767 programs in its commercial plane division and delayed its first delivery of 777-9 to 2026 and 777-8 freighter in 2028.
Flutter Entertainment jumped 4.1% to $227.90 after Wells Fargo recommended the stock, urging investors to take advantage of the recent price decline.
In London, UK trading, Flutter Entertainment and Entain PLC declined as much as 7% after a report suggested that the recently appointed U.K. government is looking to increase taxes on the gambling industry to raise as much as £3 billion.
Cryptocurrency-related stocks advanced after Bitcoin rose to $64,000.
MicroStrategy increased 5.8% to $225.12, MARA Holding jumped 6% to $17.08, and Coinbase Global rose 3% to $181.54.
European Markets Meandered as Earnings Season Gathers Pace
European markets lacked direction in Monday's trading as investor focus remained on earnings season.
Benchmark indexes in Paris, London, and Frankfurt traded around flatline, and market indexes rebounded in the previous week.
Investors reviewed the latest earnings results from last week, including updates from BP plc, Continental AG, Stellantis NV, and Porsche Automobil.
The European Central Bank's rate decision was also in view, and investors are divided about the policymakers decision.
A significant majority of investors are hoping that the central bank will keep the benchmark rate steady, but some investors are holding out for a rate cut of as much as 25 basis points.
Crude oil edged lower after rising in the previous two weeks as imminent risks of crude oil supplies receded.
Investors were on defensive after China's finance minister announced a broad plan to revive the flailing property market and inject additional capital into the banking system.
But Finance Minister Lan Fo'an failed to provide the amount and timetable for these measures, denting market enthusiasm.
In the week ahead, investors are awaiting the release of the current account balance, trade show balance, and industrial production in the Euro Area.
The UK is expected to release its retail sales, inflation update, and employment data.
Europe Indexes and Yields
The DAX index increased by 0.6% to 19,501.41; the CAC-40 index rose by 0.3% to 7,598.08; and the FTSE 100 index advanced by 0.5% to 8,292.66.
In the previous week, the DAX index increased 1%, the CAC-40 index added 0.4%, and the FTSE 100 index decreased 0.6%.
The yield on 10-year German bonds edged lower to 2.26%, French bonds inched lower to 3.04%, the UK gilts edged down to 4.23%, and Italian bonds decreased to 3.54%.
The euro edged lower to $1.09; the British pound inched higher to $1.31; and the U.S. dollar strengthened to 86.04 Swiss cents.
Brent crude decreased $1.82 to $77.20 a barrel, and the Dutch TTF natural gas rose by €0.67 to €40.48 per MWh.
Europe Stock Movers
Mulberry Group PLC soared 18% to 132.90 pence after Frasers Group, the 37% stakeholder in the fashion group, revised its potential cash offer for the remaining stake in the company at 150 pence per share.
However, the majority shareholder, Challice Limited, with a 56% stake in the company, publicly rejected the revised offer and said it has no plans to sell its stake in the company to Frasers.
Entain PLC declined 7% to 713.04 pence, and Flutter Entertainment PLC dropped 5.6% to 17,490.0 pence following a report that the UK government is looking to increase taxes on the gambling sector by as much as £3 billion.
China-linked stocks took a dive for the second session in a row after the country's fiscal stimulus measure announcement fell short of investor expectations.
LVMH declined 2.7% to €635.0, Kering SA dropped 3.9% to €229.90, and Hermes International dropped 2.8% to €2,084.0.
Japan's Nikkei 225 Stock Average Extended 3-Day Rally, Yen Drifts Near 150-Mark
Stocks in Tokyo advanced for the third day in a row after the yen drifted lower.
The Nikkei 225 stock average increased 0.6%, and the Topix index decreased 0.2%.
Stocks retained their upward bias in Tokyo as investors surmised that the Bank of Japan is not likely to raise rates in the imminent future.
Investors have been on edge over the last five weeks on the worry that the hawkish central bank may continue its aggressive increase in interest rate stance.
However, market sentiment improved after the recently appointed prime minister, Shigeru Ishiba, urged the central bank to take a gradual approach to raising rates.
Moreover, officials at the central bank also reiterated the central bank's plan to raise rates in a gradual fashion and avoid excessive depreciation of the yen.
Investors also reviewed the latest announcement by China's finance minister, Lan Fo'an, over the weekend.
Finance ministers comments fell short of market expectations, and China-linked stocks headed lower in Monday's trading.
Japan Stock Movers
The Nikkei 225 Stock Average increased 0.6% to 39,605.80, and the broader Topix index decreased 0.2% to 2,706.20.
Seven & I Holdings declined 1.4% to ¥2,292.0, and the company announced a restructuring plan to thwart off a hostile takeover offer from Canada-based Couche-Tard.
Mitsubishi UFJ Financial rose 1.7% to ¥1,552.0, Sumitomo Mitsui Financial advanced 1.5% to ¥3,167.0, and Mizuho Financial gained 1% to ¥3,048.0.
China's Fiscal Stimulus Lacks Details, Stocks Turn Lower In Hong Kong
Market sentiment in China trading was weak after the finance minister failed to provide clarity on the possible fiscal stimulus measures.
The Hang Seng index dropped as much as 1.5% and the CSI 300 index edged higher after investors reacted to comments from the finance minister at a press conference held on Saturday.
At the widely anticipated press conference held by Finance Minister Lan Fo'an, he reiterated the central government commitment to provide additional liquidity to the local banks and provide direct financial assistance to families.
Minister Fo'an laid out the government's plan in broad terms to bolster the local government's finances and support the purchase of residential units, helping the property development companies.
The move was widely anticipated, but the plan failed to provide a specific timetable and the size of the stimulus.
Investors were disappointed by the lack of clarity and urgency on the part of policymakers, which could lead to sharp swings in stock trading in the weeks ahead.
Moreover, the latest inflation updates indicated continuation of China's deflationary trend in September.
Consumer price inflation in September slowed to an annual increase of 0.4% from 0.6% in August, the lowest reading in three months, according to the data released by the National Bureau of Statistics.
Consumer price inflation was positive for the eighth consecutive month, but the increase was the smallest in three months because of the weakness in housing prices and transportation costs.
Core consumer inflation, which excludes food and energy prices, increased 0.1% from a year ago.
Producer price inflation, which tracks wholesale prices, declined 2.8% in September, faster than the 1.8% decline in the previous month, the statistics bureau reported in a separate report over the weekend.
Producer prices contracted for the 24th month in a row and fell at the fastest pace since March.
China's Exports Growth Slowed In September, Trade Surplus Shrank
China's export growth in September slowed sharply to 2.4%, import growth slipped to 0.3% from a year ago, and the country's trade surplus shrank to $81.7 billion from $91 billion in the previous month.
Exports increased to $303.7 billion and imports edged up to $222 billion, and China's international shipments remain the brightest spot in the economy.
China's exports to the U.S. rose 2.2% and surpassed shipments to the European Union and Association of Southeast Asian Nations.
Shipments to the European Union increased 1.3%, and Russia advanced 16.6%.
In the nine-month period to September, exports increased 4.3% to $2.6 trillion.
Exports to the U.S. rose 2.8%, the European Union advanced 0.9%, India 2.6%, and ASEAN jumped 10.2%.
China Stock Movers
The Hang Seng index increased 0.2% to 21,284.91 and the CSI 300 index advanced 2% to 3,965.41.
Alibaba Group declined 0.5% to HK $105.30, JD.com rose 1.6% to HK $169.80, and Tencent.com Holdings dropped 0.8% to HK $435.40.
Longfor Group rose 2.7% to HK $13.74, China Vanke added 1.4% to HK $7.41, and China Resources Land jumped 7.4% to HK $27.60.
China International Capital Corp. dropped 5.2% to HK $13.90 after China's securities regulator confirmed that the company is investigated for its lack of due diligence while listing a local chip company in 2021.
Wall Street Starts New Week with New High In S&P 500 Index
Barry Adams
14 Oct, 2024
New York City
Stock market indexes were little changed in early trading on Monday as investors remained firmly focused on earnings.
About 120 companies are set to release their quarterly results this week, including Blackstone, Charles Schwab, American Express, Netflix, P&G, and Abbott.
On the earnings front, Johnson & Johnson, Citigroup, Goldman Sachs, and Bank of America report their quarterly results on Tuesday, and Morgan Stanley, CSX, Las Vegas Sands, and United Airlines report Wednesday.
The S&P 500 index traded at a new high last week, and the index and the Nasdaq Composite advanced for the fifth week in a row amid rising expectations that the Federal Reserve could engineer a soft landing.
Despite record highs, investors are on edge because of the recent jump in crude oil prices, rate path uncertainty, and escalating geopolitical risk in the Middle East.
As of Friday's close, the S&P 500 index has advanced 22.6% and the Nasdaq Composite has jumped 24.2%, excluding dividend reinvestments.
In the week ahead, investors are looking forward to the release of September retail sales and September industrial output on Thursday, followed by September housing starts and building permits Friday.
U.S. Indexes and Treasury Yields
The S&P 500 index increased 0.2% to 5,789.69, the Nasdaq Composite fell 0.2% to 18,246.11, and the Russell 2000 index declined 0.5% to 2,189.52.
The yield on 2-year Treasury notes edged lower to 3.97%, 10-year Treasury notes inched up to 4.11%, and 30-year Treasury bonds inched higher to 4.41%.
WTI crude oil decreased $1.73 to $73.83 a barrel, and natural gas prices edged down 6 cents to $2.56 a thermal unit.
Gold fell by $4.20 to $2,656.80 an ounce, and silver decreased by $0.32 to $31.20.
The dollar index, which weighs the US currency against a basket of foreign currencies, edged higher to 103.19.
U.S. Stock Movers
Boeing declined 1.5% to $148.50 after the aviation company said it plans to cut about 10% of its staff, or about 17,000 jobs.
The company also estimated third quarter revenue of $17.8 billion, GAAP loss per share of $9.97, and operating cash outflow of $1.3 billion.
The company also announced a $3 billion charge related to its 777x and 767 programs in its commercial plane division and delayed its first delivery of 777-9 to 2026 and 777-8 freighter in 2028.
Flutter Entertainment jumped 4.1% to $227.90 after Wells Fargo recommended the stock, urging investors to take advantage of the recent price decline.
In London, UK trading, Flutter Entertainment and Entain PLC declined as much as 7% after a report suggested that the recently appointed U.K. government is looking to increase taxes on the gambling industry to raise as much as £3 billion.
Cryptocurrency-related stocks advanced after Bitcoin rose to $64,000.
MicroStrategy increased 5.8% to $225.12, MARA Holding jumped 6% to $17.08, and Coinbase Global rose 3% to $181.54.
Europe Movers: Entain, Flutter Entertainment, Luxury Stocks, Mulberry Group
Inga Muller
14 Oct, 2024
Frankfurt
European markets lacked direction in Monday's trading as investor focus remained on earnings and upcoming rate decision.
Investors are also looking forward to the release of key economic data and rate decisions.
The DAX index increased by 0.2% to 19,411.86; the CAC-40 index fell by 0.4% to 7,549.95; and the FTSE 100 index declined by 0.1% to 8,243.65.
For the week, the DAX index increased 1%, the CAC-40 index added 0.4%, and the FTSE 100 index decreased 0.6%.
The yield on 10-year German bonds edged lower to 2.26%, French bonds inched lower to 3.04%, the UK gilts edged down to 4.23%, and Italian bonds decreased to 3.54%.
Mulberry Group PLC soared 18% to 132.90 pence after Frasers Group, the 37% stakeholder in the fashion group, revised its potential cash offer for the remaining stake in the company at 150 pence per share.
However, the majority shareholder, Challice Limited, with a 56% stake in the company, publicly rejected the revised offer and said it has no plans to sell its stake in the company to Frasers.
Entain PLC declined 7% to 713.04 pence, and Flutter Entertainment PLC dropped 5.6% to 17,490.0 pence following a report that the UK government is looking to increase taxes on the gambling sector by as much as £3 billion.
China-linked stocks took a dive for the second session in a row after the country's fiscal stimulus measure announcement fell short of investor expectations.
LVMH declined 2.7% to €635.0, Kering SA dropped 3.9% to €229.90, and Hermes International dropped 2.8% to €2,084.0.
European Markets Meandered as Earnings Season Gathers Pace
Bridgette Randall
14 Oct, 2024
London
European markets lacked direction in Monday's trading as investor focus remained on earnings season.
Benchmark indexes in Paris, London, and Frankfurt traded around flatline, and market indexes rebounded in the previous week.
Investors reviewed the latest earnings results from last week, including updates from BP plc, Continental AG, Stellantis NV, and Porsche Automobil.
The European Central Bank's rate decision was also in view, and investors are divided about the policymakers decision.
A significant majority of investors are hoping that the central bank will keep the benchmark rate steady, but some investors are holding out for a rate cut of as much as 25 basis points.
Crude oil edged lower after rising in the previous two weeks as imminent risks of crude oil supplies receded.
Investors were on defensive after China's finance minister announced a broad plan to revive the flailing property market and inject additional capital into the banking system.
But Finance Minister Lan Fo'an failed to provide the amount and timetable for these measures, denting market enthusiasm.
Moreover, China's export growth in September slowed sharply to 2.4%, import growth slipped to 0.3% from a year ago, and the country's trade surplus shrank to $81.7 billion from $91 billion in the previous month.
In the week ahead, investors are awaiting the release of the current account balance, trade show balance, and industrial production in the Euro Area.
The UK is expected to release its retail sales, inflation update, and employment data.
Europe Indexes and Yields
The DAX index increased by 0.2% to 19,411.86; the CAC-40 index fell by 0.4% to 7,549.95; and the FTSE 100 index declined by 0.1% to 8,243.65.
For the week, the DAX index increased 1%, the CAC-40 index added 0.4%, and the FTSE 100 index decreased 0.6%.
The yield on 10-year German bonds edged lower to 2.26%, French bonds inched lower to 3.04%, the UK gilts edged down to 4.23%, and Italian bonds decreased to 3.54%.
The euro edged lower to $1.09; the British pound inched higher to $1.31; and the U.S. dollar strengthened to 86.04 Swiss cents.
Brent crude decreased $1.62 to $77.41 a barrel, and the Dutch TTF natural gas rose by €0.22 to €39.93 per MWh.
Europe Stock Movers
Mulberry Group PLC soared 18% to 132.90 pence after Frasers Group, the 37% stakeholder in the fashion group, revised its potential cash offer for the remaining stake in the company at 150 pence per share.
However, the majority shareholder, Challice Limited, with a 56% stake in the company, publicly rejected the revised offer and said it has no plans to sell its stake in the company to Frasers.
Entain PLC declined 7% to 713.04 pence, and Flutter Entertainment PLC dropped 5.6% to 17,490.0 pence following a report that the UK government is looking to increase taxes on the gambling sector by as much as £3 billion.
China-linked stocks took a dive for the second session in a row after the country's fiscal stimulus measure announcement fell short of investor expectations.
LVMH declined 2.7% to €635.0, Kering SA dropped 3.9% to €229.90, and Hermes International dropped 2.8% to €2,084.0.
Japan's Nikkei 225 Stock Average Extended 3-Day Rally, Yen Drifts Near 150-Mark
Akira Ito
15 Oct, 2024
Tokyo
Stocks in Tokyo advanced for the third day in a row after the yen drifted lower and fell to a five-week low.
The Nikkei 225 stock average increased 0.6%, and the Topix index decreased 0.2%, after investors returned from a three-day holiday.
Stocks retained their upward bias in Tokyo as investors surmised that the Bank of Japan is not likely to raise rates in the imminent future.
Moreover, market sentiment was bolstered following the advance in indexes in overnight trading in New York and the S&P 500 index and the Dow Jones closing at new highs.
Investors have been on edge over the last five weeks on the worry that the hawkish central bank may continue its aggressive increase in interest rate stance.
However, market sentiment improved after the recently appointed prime minister, Shigeru Ishiba, urged the central bank to take a gradual approach to raising rates.
Moreover, officials at the central bank also reiterated the central bank's plan to raise rates in a gradual fashion and avoid excessive depreciation of the yen.
Investors also reviewed the latest announcement by China's finance minister, Lan Fo'an, over the weekend.
Finance ministers comments fell short of market expectations, and China-linked stocks headed lower in Tuesday's trading.
Japan Stock Movers
The Nikkei 225 Stock Average increased 0.8% to 39,910.55, and the broader Topix index increased 0.6% to 2,723.57.
Seven & I Holdings declined 0.2% to ¥2,287.50, and the company announced a restructuring plan to thwart off a hostile takeover offer from Canada-based Couche-Tard.
Mitsubishi UFJ Financial rose 2.2% to ¥1,586.50, Sumitomo Mitsui Financial advanced 1.6% to ¥3,216.0, and Mizuho Financial gained 1.5% to ¥3,093.0.
Tokyo Electron increased 4.4% to ¥26,770.0, Advantest Corp. gained 3.3% to ¥8,061.0, and Disco Corp. advanced 2.2% to ¥38,340.0.
China's Fiscal Stimulus Lacks Details, Stocks Turn Lower In Hong Kong
Li Chen
14 Oct, 2024
Hong Kong
Market sentiment in China trading was weak after the finance minister failed to provide clarity on the possible fiscal stimulus measures.
The Hang Seng index dropped as much as 1.5% and the CSI 300 index edged higher after investors reacted to comments from the finance minister at a press conference held on Saturday.
At the widely anticipated press conference held by Finance Minister Lan Foan, he reiterated the central government commitment to provide additional liquidity to the local banks and provide direct financial assistance to families.
Minister Foan laid out the government's plan in broad terms to bolster the local government's finances and support the purchase of residential units, helping the property development companies.
The move was widely anticipated, but the plan failed to provide a specific timetable and the size of the stimulus.
Investors were disappointed by the lack of clarity and urgency on the part of policymakers, which could lead to sharp swings in stock trading in the weeks ahead.
Moreover, the latest inflation updates indicated continuation of China's deflationary trend in September.
Consumer price inflation in September slowed to an annual increase of 0.4% from 0.6% in August, the lowest reading in three months, according to the data released by the National Bureau of Statistics.
Consumer price inflation was positive for the eighth consecutive month, but the increase was the smallest in three months because of the weakness in housing prices and transportation costs.
Core consumer inflation, which excludes food and energy prices, increased 0.1% from a year ago.
Producer price inflation, which tracks wholesale prices, declined 2.8% in September, faster than the 1.8% decline in the previous month, the statistics bureau reported in a separate report over the weekend.
Producer prices contracted for the 24th month in a row and fell at the fastest pace since March.
China Stock Movers
The Hang Seng index increased 0.2% to 21,284.91 and the CSI 300 index advanced 2% to 3,965.41.
Alibaba Group declined 0.5% to HK $105.30, JD.com rose 1.6% to HK $169.80, and Tencent.com Holdings dropped 0.8% to HK $435.40.
Longfor Group rose 2.7% to HK $13.74, China Vanke added 1.4% to HK $7.41, and China Resources Land jumped 7.4% to HK $27.60.
China International Capital Corp. dropped 5.2% to HK $13.90 after China's securities regulator confirmed that the company is investigated for its lack of due diligence while listing a local chip company in 2021.
India Movers: Adani Power, Adani Enterprises, Avenue Supermarts, Macrotech Developers, LIC, Oberoi Realty
Arun Goswami
14 Oct, 2024
Mumbai
Stocks in Mumbai advanced as the earning season kicked in. Inclement weather in August dragged down industrial production.
The Sensex index decreased by 0.1% to 81,597.77, and the Nifty index rose by 0.05% to 25,000.82.
On the Mumbai stock exchange, 104 stocks traded at their 52-week highs, and 17 stocks traded at their 52-week lows.
Avenue Supermarts dropped 8% after the parent company of DMart reported weaker-than-expected earnings growth.
Revenue in the September quarter increased 14.4% from a year ago to 14,444.5 crore, and net income advanced 5.8% to 659.6 crore.
Comparable sales increased 5.5%, driven primarily by quick commerce sales at online stores DMart Ready.
Adani Power increased 0.3% to ₹644.0, and the interim government in Bangladesh is expected to seek minor tariff revisions in the 25-year power purchase agreement initiated in 2017.
Currently, Adani sells wholesale power to Bangladesh from its 1,600 MW power plant in Jharkhand.
Oberoi Realty Ltd. increased 0.6% to ₹1,930.20, and the company is planning to raise as much as ₹6,000 crore through a secondary offering.
The Mumbai-based residential real estate developer reported a 54.5% increase in its revenue in the June quarter, and the company estimated revenue growth of at least 35% in the current fiscal year.
Godrej Properties edged down 0.3% to ₹3,005.60, and the Mumbai-based residential real estate developer acquired six land parcels valued at ₹9,650 crore.
The company reported new home sales jumped 3% to ₹5,200 crore in the fiscal second quarter ending in September.
Adani Energy Solutions advanced 1.7% to ₹993.90, and the company said it signed a long-term power distribution agreement with Kenya-controlled Kenya Electricity Transmission Company.
The company plans to invest $736 million (₹6,200 crore) in building and operating key transmission lines and substations for 30 years before transferring assets to Ketraco.
Adani Enterprises increased 0.1% to ₹3,140.50, and the company completed its $500 million secondary offering, which was oversubscribed by four times.
Macrotech Developers advanced 1% to ₹1,182.05, and the company said booking for new home sales in the September quarter increased 21% from a year ago to ₹4,290 crore.
Total debt increased 11% to ₹4,920 crore, and the residential property developer estimated sales in the current fiscal year of ₹17,500 crore.
Life Insurance Corporation of India gained 1.1% to ₹958.65, and the company said new premium sales in September increased 14% to ₹35,020 crore from 30,716 crore a year ago.
U.S. Movers: BlackRock, JPMorgan Chase, Stellantis, Wells Fargo
Scott Peters
11 Oct, 2024
New York City
Stellantis NV decreased 3.5% to $12.84, and the parent of Chrysler announced a management shakeup that will change the heads of the Alfa Romeo, Jeep, and Maserati brands.
The company also announced that the current chief executive will retire at the end of his term in 2026.
JPMorgan Chase rose 5% to $223.34 after the New York-based bank reported better-than-expected quarterly results.
Revenue in the third quarter increased 6% to $43.32 billion, and net income declined to $12.9 billion from a year ago.
Net interest income rose 3% to $23.3 billion, fixed income trading revenue was unchanged at $4.5 billion, and investment banking fees increased 31% to $2.27 billion.
The company raised its net interest income estimate for the year to $92.5 billion from the previous estimate of $91 billion.
The company increased its loan loss reserve to $3.1 billion to cover the loan loss charge of $2.1 billion and provide an extra cushion of $1 billion for the future.
Wells Fargo increased 5.7% to $61.05 after the bank reported better-than-expected quarterly results.
Revenue in the third quarter declined 2% to $20.4 billion from $20.9 billion, net income dropped to $5.1 billion from $5.8 billion, and diluted earnings per share fell to $1.42 from $1.48 a year ago.
BlackRock increased 3% to $984.58, and the asset management company reported strong quarterly results.
Revenue in the third quarter increased 15% to $5.2 billion from $4.5 billion, net income advanced 2% to $1.63 billion from $1.6 billion, and diluted earnings per share rose 2% to $10.90 from $10.66 a year ago.
Assets under management increased 15% to $11.475 trillion from $9.10 trillion, driven by a total net inflow of $221.8 billion.
Record High In S&P 500 Extends Weekly Gains to Fifth Consecutive Week
Barry Adams
11 Oct, 2024
New York City
Benchmark indexes headed for the fifth winning weak on Wall Street as investors reviewed the latest earnings from banks and wholesale inflation.
The S&P 500 increased 0.2% and the Nasdaq Composite edged lower 0.2% after the measure of wholesale inflation showed a cooling trend in September.
For the week, the S&P 500 index is up 0.5% and the Nasdaq Composite advanced 0.8% as of the end of close on Thursday.
Producer price inflation was flat from the previous month following the increase of 0.2% in the previous month, the U.S. Bureau of Labor Statistics reported Friday.
On an annual basis, the measure of wholesale inflation slowed to 1.8% from an upwardly revised 1.9% in the previous month.
However, the core rate of inflation, which excludes food and energy prices, accelerated to 2.8% from 2.7% in the previous month.
Despite the cooling trend in overall inflation, core wholesale inflation rose, confirming the similar trend in consumer price inflation.
Investors have been ignoring the rise in core inflation, which is driven by service inflation, and despite the Fed's eleven rate hikes over 2022 and 2023, inflation has failed to slow to the target rate of 2%.
U.S. Indexes and Treasury Yields
The S&P 500 index increased 0.2% to 5,789.69, the Nasdaq Composite fell 0.2% to 18,246.11, and the Russell 2000 index declined 0.5% to 2,189.52.
The yield on 2-year Treasury notes edged lower to 3.97%, 10-year Treasury notes inched up to 4.10%, and 30-year Treasury bonds inched higher to 4.41%.
WTI crude oil increased $0.71 to $75.13 a barrel, and natural gas prices edged down 1 cent to $2.65 a thermal unit.
Gold rose by $14.60 to $2,647.15 an ounce, and silver increased by $0.21 to $31.24.
The dollar index, which weighs the US currency against a basket of foreign currencies, edged higher to 102.98.
U.S. Stock Movers
Stellantis NV decreased 3.5% to $12.84, and the parent of Chrysler announced a management shakeup that will change the heads of the Alfa Romeo, Jeep, and Maserati brands.
The company also announced that the current chief executive will retire at the end of his term in 2026.
JPMorgan Chase rose 5% to $223.34 after the New York-based bank reported better-than-expected quarterly results.
Revenue in the third quarter increased 6% to $43.32 billion, and net income declined to $12.9 billion from a year ago.
Net interest income rose 3% to $23.3 billion, fixed income trading revenue was unchanged at $4.5 billion, and investment banking fees increased 31% to $2.27 billion.
The company raised its net interest income estimate for the year to $92.5 billion from the previous estimate of $91 billion.
The company increased its loan loss reserve to $3.1 billion to cover the loan loss charge of $2.1 billion and provide an extra cushion of $1 billion for the future.
Wells Fargo increased 5.7% to $61.05 after the bank reported better-than-expected quarterly results.
Revenue in the third quarter declined 2% to $20.4 billion from $20.9 billion, net income dropped to $5.1 billion from $5.8 billion, and diluted earnings per share fell to $1.42 from $1.48 a year ago.
BlackRock increased 3% to $984.58, and the asset management company reported strong quarterly results.
Revenue in the third quarter increased 15% to $5.2 billion from $4.5 billion, net income advanced 2% to $1.63 billion from $1.6 billion, and diluted earnings per share rose 2% to $10.90 from $10.66 a year ago.
Assets under management increased 15% to $11.475 trillion from $9.10 trillion, driven by a total net inflow of $221.8 billion.
Europe Movers: BP, Hayes, Porsche, Stellantis, Zalando
Inga Muller
11 Oct, 2024
Frankfurt
European markets struggled to advance amid a lack of domestic catalyst. France's proposed fiscal budget estimates a 5% deficit and calls for a mix of spending cuts and new taxes.
The DAX index increased by 0.1% to 19,229.95; the CAC-40 index rose by 0.1% to 7,545.45; and the FTSE 100 index declined by 0.2% to 8,224.35.
For the week, the DAX index increased 1%, the CAC-40 index added 0.4%, and the FTSE 100 index decreased 0.6%.
The yield on 10-year German bonds edged higher to 2.29%, French bonds inched higher to 3.07%, the UK gilts edged up to 4.25%, and Italian bonds increased to 3.56%.
Stellantis NV declined 3.7% to €11.73, and the Italian vehicle maker said chief executive Carlos Tavares retired in 2026 after the company announced a management shakeup.
The automotive global conglomerate also announced new leaders for its Maserati, Alfa Romeo, and Jeep brands.
Doug Ostermann will replace Natalie Knight as the new chief financial officer as the company struggles amid falling sales in China and intensifying competition in Europe.
Late September, the company's management lowered its current year annual profit outlook and added its operating cash flow is going to be negative.
Porsche Automobil SE edged down 0.1% to €39.84 after the German sports vehicle maker reported weak vehicle sales in the nine months of fiscal 2024.
BP plc declined 0.1% to 410.60 pence, and the energy giant confirmed in its trading statement that weak refining margins and volatile trading are going to negatively impact its earnings.
Hays plc rose 0.8% to 86.45 pence despite the recruiting company reporting a sequential decline in its first-half operating profit.
Zalando SE increased 0.1% to €29.84 after the German online retailer lifted its fiscal year outlook.
European Markets Trim Weekly Gains, France's Fiscal 2025 Budget Targets 5% Deficit
Bridgette Randall
11 Oct, 2024
London
European markets lacked direction in Friday's trading as investors reviewed the region's economic data and looked forward to China's finance minister's press briefing on Saturday.
Benchmark indexes in Paris, Milan, Frankfurt, and London struggled to advance, and the euro edged slightly lower.
France's prime minister, Michele Barnier, proposed a fiscal budge with the aim of lowering the budget deficit to 5% of gross domestic product, still higher than the 3% limit set by the European Union.
The proposed budget includes spending cuts of Є41.3 billion and tax increases of Є19.3 billion targeting ultra-wealthy individuals and large businesses.
Budget is expected to face tough resistance in the fragmented legislative assembly, but France has little choice and must find ways to bring down its large and growing budget deficit if it wants to avoid restrictions from the European Union.
In other economic news, Germany's consumer price inflation slowed to 1.6% in September from 1.9% in August. the Federal Statistical Office confirmed in a report today.
The preliminary estimate was released on September 30.
Europe Indexes and Yields
The DAX index increased by 0.1% to 19,229.95; the CAC-40 index rose by 0.1% to 7,545.45; and the FTSE 100 index declined by 0.2% to 8,224.35.
For the week, the DAX index increased 1%, the CAC-40 index added 0.4%, and the FTSE 100 index decreased 0.6%.
The yield on 10-year German bonds edged higher to 2.29%, French bonds inched higher to 3.07%, the UK gilts edged up to 4.25%, and Italian bonds increased to 3.56%.
The euro edged lower to $1.09; the British pound inched higher to $1.30; and the U.S. dollar strengthened to 85.79 Swiss cents.
Brent crude decreased $0.67 to $78.72 a barrel, and the Dutch TTF natural gas rose by €0.12 to €40.21 per MWh.
Europe Stock Movers
Stellantis NV declined 3.7% to €11.73, and the Italian vehicle maker said chief executive Carlos Tavares retired in 2026 after the company announced a management shakeup.
The automotive global conglomerate also announced new leaders for its Maserati, Alfa Romeo, and Jeep brands.
Doug Ostermann will replace Natalie Knight as the new chief financial officer as the company struggles amid falling sales in China and intensifying competition in Europe.
Late September, the company's management lowered its current year annual profit outlook and added its operating cash flow is going to be negative.
Porsche Automobil SE edged down 0.1% to €39.84 after the German sports vehicle maker reported weak vehicle sales in the nine months of fiscal 2024.
BP plc declined 0.1% to 410.60 pence, and the energy giant confirmed in its trading statement that weak refining margins and volatile trading are going to negatively impact its earnings.
Hays plc rose 0.8% to 86.45 pence despite the recruiting company reporting a sequential decline in its first-half operating profit.
Zalando SE increased 0.1% to €29.84 after the German online retailer lifted its fiscal year outlook.
Japan's Indexes Extend 3-day Rally, Seven & I and Fast Retailing In Focus After Earnings
Akira Ito
11 Oct, 2024
Tokyo
Market indexes in Japan advanced for the third consecutive session and traded at two-week highs.
The Nikkei 225 stock average gained 0.5% and the broader Topix index edged lower 0.1%.
The yen drifted lower to 148.68 against the U.S. dollar as investors lowered expectations of another rate increase in the imminent future.
Financial markets in Tokyo traded volatile over the last four weeks amid rising geopolitical tensions, and a rebound in crude oil prices also stoked fears of resurgent inflation.
Volatility in the yen has also overshadowed market sentiment in stocks, with the yen dropping as low as 161.68 in early July but managed to recover to the 140 mark.
The Bank of Japan commenced its rate increase cycle in March, followed by the second rate increase in July, and signaled additional rate hikes.
However, the central bank policymakers have stressed several times that future rate increases are likely but not imminent, and the central bank needs time to review the impact of recent rate increases on the economy.
Japan Stock Movers
The Nikkei 225 stock average increased 0.5% to 39,582.32, and the broader Topix index declined 0.1% to 2,708.65.
For the week, the Nikkei 225 edged higher by 0.5% and the Topix index decreased by 1%.
Fast Retailing surged 5.5% to ¥54,220.0 after the parent company of Uniqlo reported better-than-expected earnings.
Revenue in the fiscal year ending in August increased 12.2% to 3.1 trillion yen, net profit rose 25% to 393.6 billion yen, and diluted earnings per share rose to 1,210.81 yen from 964.48 yen a year ago.
For the full year, the company increased its dividends to 122.7 billion yen from 88.93 billion yen, an increase in payout ratio to 33.3% from 30% a year ago.
Revenue in Japan increased 4.7% to 932.2 billion yen, and operating profit soared 32% to 155.8 billion yen.
Warmer weather in the fiscal second half and the surge in tourism supported the rise in sales at domestic stores.
Same store sales in the first half contracted 3.4% as a result of the warm winter, but sales rebounded in the second half to 11.7% as the company took advantage of longer summer weather temperatures.
Revenue at international stores increased 19.1% to 1.72 trillion yen, and operating profit soared 24.9% to 283.4 billion yen.
In fiscal year 2025, the company expects consolidated revenue to increase 9.5% to 3.4 trillion yen, operating profit to rise 5.8% to 530 billion yen, profit before income taxes to rise 5% to 585.0 billion, and profit attributable to owners of the parent to rise 3.5% to 385.0 billion yen.
Seven & I declined 1.4% to ¥2,292.0, and the parent company of Seven 11 announced restructuring to lift its stock price.
Revenue for the six-month period ending August increased 8.8% to 6.03 trillion yen, net income declined 26.3% to 167.2 billion yen, and diluted earnings per share fell to 20.08 yen from 30.28 yen.
The company also reiterated its plans to lower its total annual dividend to 20 yen per share from 113 yen in the previous year.
The company estimated full-year revenue in the fiscal year 2025 to increase 3.5% to 11.87 trillion yen, net income attributable to shareholders to fall 27.4% to 163 billion yen, and diluted earnings per share of 62.74 yen.
Sales at domestic stores declined to 462.4 billion yen compared to 470.7 billion yen as consumers battled rising prices.