On 13 November, 2017 – Global stocks were mixed — indices in Europe and Asia mostly lower and the US barely positive
Investors will be swamped with new economic data to assess later in the week.
United States
The Dow Jones industrials, S&P and Nasdaq each edged up 0.1 percent on Monday. Industrials were dragged down by General Electric after the company cut its dividend for only the second time since 1938, lowered its profit forecast and said it would divest two of its divisions. Investors were waiting for comments later in the week from Fed speakers along with updates on the progress of tax reform through the Congress. Takeover bids in part drove shares.
Some relief for investors came from the regulatory side with shares of regional banks higher after the Wall Street Journal reported a bipartisan group of Senate lawmakers reached a tentative agreement to ease some regulations on the sector.
Mattel jumped after a report that rival Hasbro made an approach to acquire the company. Hasbro also advanced. Qualcomm gained after the chipmaker rejected rival Broadcom’s $103-billion takeover bid, saying the offer “dramatically” undervalued the company. Tyson Foods climbed after the meat processor said low prices for livestock feed will help boost results again next year. Roku continued to rally since the company reported earnings last week.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was down US$6.35 to US$1,277.95. Copper futures were up 1.5 percent to US$3.12. WTI spot crude was down 3 US cents to US$56.71. Dated Brent spot crude was down 40 US cents to US$63.12. The US dollar was up against the pound and the Canadian and Australian dollars. It was unchanged against the euro, yen and Swiss franc. The Dollar Index was down 0.1 percent. The yield on the US Treasury 30 year bond was down 1 basis point to 2.87 percent while the 10 year note was unchanged at 2.40 percent.
European markets
European stock indices retreated Monday. Concerns over UK Prime Minister Theresa May’s leadership emerged after a media report revealed that Conservative party lawmakers have agreed to sign a letter of no confidence in the PM. The report said 40 Tory MPs were backing a motion of “no confidence” against the prime minister criticizing for her handling of EU negotiations. This fell short of 48 MPs required to force a leadership challenge and remove May from office. The FTSE edged down 0.2 percent, the CAC declined 0.7 percent and the DAX was 0.4 percent lower. The SMI however, added 0.3 percent.
Deutsche Post rose amid reports that the company aims to give its in-house StreetScooter electric delivery vehicles more autonomy. EDF tumbled after cutting its profit forecast for next year. Dignity dropped after the funeral operator warned of rising costs amid intense competition. Homebuilder Taylor Wimpey slipped after reporting strong sales for the second half of 2017.
Novartis rose in Zurich after announcing collaboration with Homology Medicines to develop therapies for genetic blood and eye diseases. Sonova slid after its first half sales came in below expectations. Both Nestlé and Roche also gained. In London, Diageo and AstraZeneca advanced as did oil majors Royal Dutch Shell and BP thanks to the pound’s retreat. Carnival was higher on the day. Also in London, financials including RBS, Lloyds, HSBC, Standard Chartered and Barclays declined.
October wholesale price inflation eased to a 3-month low in Germany. Wholesale prices climbed 3 percent on the year after climbing 3.4 percent September. This was the weakest growth since July, when prices gained 2.2 percent. Swatch and Richemont both finished lower after broker downgrades.
Asia Pacific
Most Asian stock indices were lower Monday as investors waited for a slew of data from China, Japan and Australia this week. Concerns about political instability in the UK and Saudi Arabia also weighed on markets.
The Shanghai Composite was up 0.4 percent and the Hang Seng added 0.2 percent. A surge in financials following Beijing’s deregulation in the financial sector helped Chinese stocks finish the day solidly higher.
Japanese stocks declined to end near a two-week low, with realty and technology stocks pacing the decliners after recent rallies. The Nikkei tumbled 1.3 percent extending losses for the fourth straight session and marking its lowest closing level since October 31. The Topix was 0.9 percent lower. Realty stocks such as Mitsubishi Estate and Mitsui Fudosan declined while tech stocks Tokyo Electron and Advantest were lower. Nissin Foods Holdings soared on solid earnings results, however.
The S&P/ASX and All Ordinaries both slipped 0.1 percent, dragged down by financials as banks ANZ and Westpac dropped after going ex-dividend. Higher base metals prices helped lift miners, with both BHP Billiton and Rio Tinto gaining on the day. The Australian dollar was little changed despite upbeat comments from the Reserve Bank of Australia deputy governor Guy Debelle and the escalating citizenship MP eligibility fiasco.
The Kospi was down 0.5 percent. The Sensex tumbled 0.8 percent as investors awaited for consumer and wholesale price inflation data this week.
Looking forward
China posts October fixed asset investment, industrial production and retail sales. Germany releases third quarter flash gross domestic product and November ZEW. The Eurozone also reports third quarter flash gross domestic product along with September industrial production. In the US, October PPI-FD will be reported.
Global Stock Markets
*Note — all releases are listed in local time.
Source: Fidelity
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