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European Equities: A Week in Review – 19/11/21
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It was a mixed week for the majors, with the EuroStoxx600 ending the week in the red. The majors gave up gains from earlier in the week, as concerns over COVID-19 weighed on riskier assets late in the week.
In this article:
The Majors
It was a mixed week for the majors in the week ending 19th November.
The EuroStoxx600 fell by 0.14%, while the CAC40 and the EuroStoxx600 ended the week with gains of 0.29% and 0.41% respectively.
A bearish end to the week left the EuroStoxx600 in the red and the rest of the majors with modest gains.
At the start of the week, economic data from China delivered early support, with the EuroStoxx600 hitting record highs before the pullback.
Economic data from the Eurozone and the U.S were also upbeat, with central bank chatter easing concerns of a shift in policy on interest rates.
Late in the week, however, concerns over the prospects of new EU lockdown measures weighed on riskier assets.
The Stats
Early in the week, Eurozone trade data was in focus ahead of Eurozone GDP numbers for the 3rd quarter.
In September, the Eurozone’s trade surplus widened from €3.5bn to €7.3bn, with both exports and imports on the rise. Year-on-year, intra-euro area trade was up 16.4%.
2nd estimate GDP numbers for the 3rd quarter were in line with 1st estimates, providing support. In the 2nd quarter, the economy expanded by 2.2%, with the economy growing by 3.7% year-on-year.
Mid-week, Eurozone inflation failed to weigh in spite of another pickup in inflationary pressure.
In October, the Eurozone’s annual rate of inflation accelerated from 3.4% to 4.1%, which was in line with prelim figures.
At the end of the week, German wholesale inflation figures also had a muted impact on the majors. In October, Germany’s wholesale rate of inflation accelerated from 14.2% to 18.4%.
From the ECB, the Financial Stability Review provided few surprises, while ECB President Lagarde provided support.
In a number of speeches throughout the week, the ECB President continued to assure the markets of status quo on the interest rate front…
From the U.S
Through the 1st half of the week, retail sales figures impressed, in spite of the marked pickup in inflationary pressure.
In October, core retail sales rose by 1.7%, with retail sales also up 1.7%. Retail sales had risen by 0.5% in September, with core retail sales having risen by 0.70%.
On Thursday, Philly FED Manufacturing PMI figures and the weekly jobless claims also drew interest.
The Philly FED Manufacturing PMI increased from 23.8 to 39.0, with the upside coming in spite of continued supply chain disruptions.
Jobless claims figures were less impressive, however, with initial jobless claims falling from 269k to 268k in the week ending 12th November.
The Market Movers
From the DAX, it was another mixed week for the auto sector. Volkswagen and Continental fell by 3.95% and by 0.91% respectively. BMW and Daimler ended the week up by 0.33% and by 2.38% respectively.
It was a bearish week for the banking sector, however. Deutsche Bank and Commerzbank slid by 2.87% and by 3.74% respectively.
From the CAC, it was also a bearish week for the banks. Credit Agricole and Soc Gen fell by 1.96% and by 1.47% respectively. BNP Paribas led the way down, however, sliding by 2.62%.
The French auto sector also saw red. Stellantis NV and Renault ended the week down by 2.04% and by 4.19% respectively.
Air France-KLM slid by 4.45%, with Airbus declining by 2.44%.
On the VIX Index
It was back into the green for the VIX in the week ending 19th November, marking a 3rd weekly gain in 7-weeks.
Reversing a 1.15% fall from the previous week, the VIX rose by 9.94% to end the week at 17.91.
4-days in the green from 5 sessions, which included a 4.52% rise on Wednesday delivered the upside.
For the week, the Dow fell by 1.38%, while the NASDAQ and the S&P500 ended the week up by 1.24% and by 0.32% respectively.
The Week Ahead
It’s a busier week ahead on the economic calendar.
At the start of the week, Eurozone consumer confidence figures for November will be in focus.
With lockdown chatter hitting the news wires at the end of last week, however, the numbers will likely have a muted impact on the majors.
On Tuesday, prelim November private sector PMI numbers for France, Germany, and the Eurozone will influence.
While the headline figures will influence, expect the new orders, delivery times and inflation to be key.
In the 2nd half of the week, the German economy is back in focus.
Business sentiment figures for November will be in focus on Wednesday ahead of 3rd quarter GDP numbers on Thursday.
Consumer sentiment figures for Germany are also due out on Thursday but coincide with the GDP numbers.
From the U.S, prelim private sector PMIs for November will be in focus ahead of a particularly busy Wednesday.
Expect the services PMI to be the key stat.
On Wednesday, however, core durable goods, personal spending, jobless claims, and inflation figures will be in focus.
Barring any revisions from prelim figures, 3rd quarter GDP numbers will likely have a muted impact, however.
On the monetary policy front, expect central bank chatter to also continue to provide direction.
Away from the economic calendar, commodity prices and COVID-19 news updates will need monitoring.
About the Author
Bob Masonauthor
With over 20 years of experience in the finance industry, Bob has been managing regional teams across Europe and Asia and focusing on analytics across both corporate and financial institutions. Currently he is covering developments relating to the financial markets, including currencies, commodities, alternative asset classes, and global equities.
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