European Equities: Corporate Earnings, COVID-19, and U.S Stats in Focus
Tuesday, 3rd August
Spain Unemployment Change JUL
Wednesday, 4th August
Spain Markit Services PMI JUL
Italy IHS Markit Services PMI JUL
French Markit Services PMI Final JUL
German Markit Services PMI Final JUL
Eurozone Markit Services PMI Final JUL
Eurozone Retail Sales MoM JUN
Thursday, 5th August
German Factory Orders MoM JUN
German Construction PMI JUL
ECB Economic Bulletin
Friday, 6th August
German Industrial Production MoM JUN
It was a bullish start to the month of August for the European majors on Monday.
The CAC40 rose by 0.95%, with the DAX30 and the EuroStoxx600 ending the day up by 0.16% and by 0.59% respectively.
Economic data from China and a continued rise in new Delta variant cases failed to leave the majors in the red on Monday.
Positive economic data from the Eurozone delivered support, with rising Asian equities delivering support to the European majors.
Manufacturing PMI numbers for July were in focus at the start of the week along with retail sales from Germany.
German retail sales jumped by 4.2% in June, following a 4.6% increase in May. Economists had forecast a more modest 1.5% increase.
Member States PMIs
France, Italy, and Spain saw softer manufacturing sector growth in July.
Spain’s PMI fell from 60.4 to 59.0, with France and Italy’s PMIs declining from 59.0 to 58.0 and from 62.2 to 60.3 respectively.
Germany’s manufacturing PMI rose from 65.0 to 65.9, which was up from a prelim 65.6.
For the Eurozone, the manufacturing PMI fell from 63.4 to 62.8, which was up from a prelim 62.6.
From the U.S
The manufacturing sector was also in focus.
In July, the market’s preferred ISM Manufacturing PMI fell from 60.6 to 59.6. Economists had forecast a fall to 60.4.
The Market Movers
For the DAX: It was a mixed day for the auto sector on Monday. Daimler and BMW saw gains of 1.57% and 1.17% respectively to lead the way. Continental rose by 0.37%, while Volkswagen slipped by 0.02% to buck the trend on the day.
It was a bearish day for the banks, however. Deutsche Bank and Commerzbank fell by 1.64% and by 0.51% respectively.
From the CAC, it was a mixed day for the banks. BNP Paribas and Credit Agricole fell by 0.97% and by 0.31% respectively. Soc Gen bucked the trend, however, rising by 0.57%.
It a bullish day for the French auto sector, however. Stellantis NV rose by 1.11%, with Renault ending the day up by 2.28%.
Air France-KLM rallied by 4.03%, with Airbus SE gaining by 0.93%
On the VIX Index
It was a 2nd consecutive day in the green for the VIX on Monday.
Following a 3.05% gain on Friday, the VIX rose by 6.69% to end the day at 19.46.
The NASDAQ rose by 0.06%, while the Dow and the S&P500 ended the day down by 0.28% and by 0.18% respectively.
The Day Ahead
It’s a quiet day ahead on the economic calendar. Economic data from the Eurozone is limited to employment figures from Spain. We don’t expect the numbers to have an impact on the European majors, however.
Later in the day, factory orders from the U.S will draw interest. Expect weak numbers to test support for the majors as concerns over the economic outlook linger.
Away from the economic calendar, COVID-19 news updates and corporate earnings will also need considering.
In the futures markets, at the time of writing, the Dow Mini was up by 67 points.
For a look at all of today’s economic events, check out our economic calendar.