European Equities: German Business Sentiment and Earnings in Focus
Monday, 25th October
German Ifo Business Climate Index (Oct)
Wednesday, 26th October
German GfK Consumer Confidence (Nov)
Thursday, 27th October
Spanish HICP (YoY) (Oct) Prelim
German Unemployment Change (Oct)
German Unemployment Rate (Oct)
ECB Interest Rate Decision (Oct)
German CPI (MoM) (Oct) Prelim
ECB Press Conference
Friday, 29th October
French Consumer Spending (MoM) (Sep)
French GDP (QoQ) (Q3) 1st Estimate
German GDP (QoQ) (Q3) 1st Estimate
German GDP (YoY) (Q3) 1st Estimate
Spanish GDP (QoQ) (Q3) 1st Estimate
Italian CPI (MoM) (Oct) Prelim
Eurozone CPI y/y (Oct) Prelim
Eurozone GDP q/q (Q3) 1st Estimate
Eurozone GDP y/y (Q3) 1st Estimate
It was a bullish end to the week for the European majors on Friday.
The CAC40 rose by 0.71%, with the DAX30 and the EuroStoxx600 both ending the day up by 0.46% respectively.
Economic data from the Eurozone and the U.S provided the majors with support on the day.
While manufacturing PMI numbers were on the softer side, Germany and the Eurozone’s PMIs for October only saw modest declines.
From the U.S, private sector PMIs were also positive for riskier assets, with service sector activity picking up in October.
The upside on the day was modest, however, with concerns over the impact of inflation on the economy pegging the majors back.
Germany’s Manufacturing PMI slipped from 58.4 to 58.2, with the Eurozone’s Manufacturing PMI falling from 58.6 to 58.5.
Service sector activity saw a more marked slowdown in growth at the turn of the quarter.
The Eurozone’s Services PMI fell from 56.4 to 54.7.
From the U.S
In October, the Manufacturing PMI slipped from 60.7 to 59.2, while the Services PMI rose from 54.9 to 58.2. The pickup in service sector activity was key on the day.
On the monetary policy front, FED Chair Powell spoke at the end of the week, with the FED on scheduled to begin tapering.
The Market Movers
For the DAX: It was a bullish day for the auto sector on Friday. Volkswagen rallied by 2.12% to lead the way, with BMW rising by 1.65%. Continental and Daimler ended the day with more modest gains of 0.60% and by 0.59%, respectively.
It was a mixed day for the banks, however. Deutsche Bank rose by 0.52%, while Commerzbank slipped by 0.28%.
From the CAC, it was a bullish day for the banks. Credit Agricole rose by 0.86%, with BNP Paribas and Soc Gen ending the day up by 0.21% and 0.55% respectively.
It was a mixed day for the French auto sector, however. Stellantis NV slipped by 0.02%, while Renault rose by 0.63%.
Air France-KLM gave up Thursday’s modest gain, falling by 2.05%, with Airbus SE ending the day down by 1.44%.
On the VIX Index
It was back into the green for the VIX on Friday, marking just a 2nd day in the green from 9-sessions.
Partially reversing a 3.10% decline from Thursday the VIX rose by 2.80% to end the day at 15.43.
The Dow rose by 0.21%, while the NASDAQ and the S&P500 fell by 0.82% and 0.11% respectively.
The Day Ahead
It’s a quieter day ahead on the Eurozone’s economic calendar. German business sentiment figures will be in focus ahead of the European open.
With the ECB in action later in the week, expect the numbers to set the tone.
There are no material stats from the U.S to influence later in the day, however. The lack of stats will leave the majors in the hands of commodity prices and corporate earnings. As seen over the previous week, company outlooks will likely have a greater impact than actual earnings…
In the futures markets, at the time of writing, the Dow Mini was down by 63 points.
For a look at all of today’s economic events, check out our economic calendar.