European Equities: U.S Retail Sales, the FED, and Omicron in Market Focus

The Majors

It was another bearish day for the European majors on Tuesday.

The DAX30 slid by 1.08%, with the CAC40 and EuroStoxx600 falling by 0.69% and by 0.71% respectively.

Economic data from the Eurozone failed to deliver support. Market jitters over pending policy decisions from the FED and the ECB, coupled with concerns over the Omicron strain continued to weigh on risk appetite.

From the U.S, a pickup in wholesale inflationary pressures in November added to the market angst.

The Stats

October industrial production figures for the Eurozone were in focus early in the European session.

In October, industrial production rose by 1.1%, reversing a 0.2% decline from September. Economists had forecast a 1.2% increase.

According to Eurostat,

• Production of capital goods rose by 3.0% and durable consumer goods by 1.7%.
• There were also increases in the production of non-durable consumer goods (+0.4%) and energy (+0.1%).
• The production of intermediate goods fell by 0.6%, however.
• By member state, Germany and Slovakia (both +3.0%) and Greece (+2.5%) had the largest increases in production.
• Estonia (-2.4%), Latvia (-1.5%), and the Netherlands (-0.9%) had the largest falls in production.
• Compared with October 2020, industrial production rose by 3.3% after having risen by 5.1% in September.
• Year-on-year, energy production was a drag, falling by 1.0%.
• By member state, Lithuania and Greece led the way, with production up by 22.7% and by 17.2% respectively.
• Portugal led the way down, however, with production falling by 6.5% when compared with October 2020.

From the U.S

Wholesale inflation figures for November were in focus as the FOMC meeting got underway.

In November, the core producer price index rose by 0.7% following a 0.4% increase in October. The producer price index rose by 0.8% off the back of a 0.6% increase in October. Economists had forecast increases of 0.4% and 0.5% respectively.

The annual core rate of wholesale inflation accelerated from 7.0% to 7.7% in November.

The Market Movers

For the DAX: It was a bearish day for the auto sector on Tuesday. Daimler slid by 2.90%, with BMW and Continental falling by 1.59% and by 1.40% respectively. Volkswagen ended the day with a more modest 0.17% loss.

It was a bullish day for the banks, however. Deutsche Bank and Commerzbank ended the day with gains of 1.48% and 2.26% respectively.

From the CAC, it was also a bullish day for the banks Credit Agricole and Soc Gen rose by 0.87% and by 0.99% respectively, with BNP Paribas gaining 0.16%.

The French auto sector struggled, however. Stellantis NV and Renault ended the day down by 0.20% and by 1.24% respectively.

Air France-KLM rose by 0.79%, while Airbus SE ended the day with a 0.56% loss.

On the VIX Index

It was a 2^nd consecutive day in the green for the  VIX on Tuesday.

Following an 8.67% increase on Monday, the VIX rose by 7.78% to end the day at 21.89.

The NASDAQ slid by 1.14%, with the Dow and the S&P500 falling by 0.30% and by 0.75% respectively.