European Equities: Economic Data from China to Set the Mood ahead of Eurozone Trade Data

The Majors

It was a relatively bullish end to a choppy week for the European majors on Friday.

The CAC40 rose by 0.45% to lead the way, with the DAX30 and the EuroStoxx600 seeing gains of 0.07% and 0.32% respectively, however. While the gains were modest, it was record highs in the week.

Market sentiment towards the earnings delivered the upside, with upbeat earnings reflecting a positive environment and outlook.

Betting than expected industrial production figures for the euro area also provided the majors with support.

Disappointing economic data from the U.S failed to sink the majors late in the day.

The Stats

Economic data included industrial production figures for the Eurozone and finalized inflation figures from Spain.

Eurozone Industrial Production

In September, industrial production fell by 0.2% following a 1.7% decline from August.

According to Eurostat,

• Production of capital goods fell by 0.7% and intermediate goods by 0.2%.
• By contrast, production of durable consumer goods rose by 0.5% and non-durable consumer goods by 1.0%.
• Energy production remained stable in the month.
• By member state, Belgium (+3.7%) recorded the highest increase, while Austria (-3.0%) registered the largest decline.
• In September 2021 compared with September 2020, industrial production rose by 5.2%.

Inflation

In October, Spain’s annual rate of inflation accelerated from 4.0% to 5.4%, which was down from a prelim 5.5%.

From the U.S

JOLT’s job openings and consumer sentiment figures were in focus late in the European session.

In September, JOLT’s job openings fell from 10.629m to 10.438m versus a forecasted decline to 10.300Mm.

While job openings fared better than expected, consumer sentiment and expectation figures disappointed.

According to prelim figures for November, the Michigan Consumer Expectations Index fell from 67.9 to 62.8.

Of greater significance, however was a fall in the Michigan Consumer Sentiment Index from 71.7 to 66.8.

According to the November survey,

• Consumer sentiment fell to its lowest level in a decade due to an escalating inflation rate.
• One-in-four consumers cited inflationary reductions in their living standards in November.
• Rising prices for homes, vehicles, and durables were reported more frequently than any other time in more than half a century.

The Market Movers

For the DAX: It was a bullish day for the auto sector on Friday. Continental rallied by 2.96%, with Volkswagen ending the day up by 1.34%. BMW and Daimler saw more modest gains of 0.85% and 0.69% respectively.

It was a bearish day for the banks, however. Deutsche Bank slipped by 0.09%, with Commerzbank falling 1.88%.

From the CAC, it was also a bearish day for the banks. BNP Paribas and Soc Gen fell by 0.35% and by 0.68% respectively, with Credit Agricole ending the day down by 1.24%.

It was a mixed day for the French auto sector, however. Stellantis NV slipped by 0.06%, while Renault rallied by 4.39%, supported by a Morgan Stanley upgrade.

Air France-KLM saw yet more red, falling by 2.42%, with Airbus SE ending the day with a 2.23% loss.

On the VIX Index

It was a 2^nd consecutive day in the red for the  VIX on Friday, which had seen a run of 5 sessions in the green come to an end on Thursday.

Following a 5.71% fall from Thursday, the VIX slid by 7.76% to end the day at 16.29.

The NASDAQ rose by 1.00%, with the Dow and the S&P500 ending the day up by 0.50% and by 0.72% respectively.