Reports » Europe

European stock market, economy and companies update (November 01, 2012)

Contributed by Trade The News

*** SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM ***
***Notes/Observations***
- Further improvement in mainland manufacturing PMIs going into next week's National Party Congress
- China PBoC injected CNY379B into the money markets this week (fresh record high) through regular open market operations
- US IEA: saw no urgent need for oil stocks release following Hurricane Sand
- DJIA suffered its first October decline since 2008 finishing the month down 2.5%

***Equities***
FTSE 100 +0.20% at 5,793, DAX flat at 7,261, CAC-40 flat at 3,428, IBEX-35 -0.60% at 7,794, FTSE MIB -0.25% at 15,495, SMI -0.10% at 6,591, S&P 500 Futures -0.30% at 1,402

- European equity indices have remained mixed, as the Spanish IBEX-35 and Italian FTSE MIB have underperformed. Spanish and French banks have lagged other financials. Resources firmed are mixed despite, the gains being seen in commodity prices. In terms of European earnings, corporate reports were dominated by large UK companies. British Sky [BSY.UK] has risen by over 3%, as the company reported a y/y increase in its average revenue per user (ARPU) and decline in its churn rate. Royal Dutch Shell [RDSA.UK] is slightly higher on better than expected quarterly profits. Shares of Lloyds [LLOY.UK] are higher by more than 3%, as the firm reported a y/y rise in its core underlying profits.

Speakers:
- Greek PASOK Lawmaker Kassis commented that he would not vote for austerity measures to secure Troika deal. He then left the party and became independent MP
- German Fin Min official stated that the upcoming G20 to discuss Europe plans for banking union and Basel III in Mexico. G20 would focus on underpinning global economic growth. He noted that Greece would not figure much in G20 discussions as the country's debt sustainability issue remained unresolved. Mexico has moderate Euro crisis critics. Schaeuble to give keynote speech at G20
- China PBoC Gov Zhou reiterated his view that the global economic situation remained complicated
- German Chemical Association VCI reaffirmed its 2012 outlook with sales around €184B. It noted that demand from outside the EU helped support Q3 which saw Chemical sales +2% y/y, Production -0.5% y/y.

Currencies:
- The China PMI data seemed to confirm the recent spat of upward growth momentum seen since September might continue. However, the economic data translated into a mixed picture on the risk front. The EUR/USD drifted lower to test below 1.2940. The surge in ECB borrowing data would have seemed to weighed upon the Euro but dealers largely believed the increase in borrowings was technical due to the beginning of the month. There are lingering concerns on Greece and other peripherals. Greek PASOK Lawmaker Kassis stated that he would not vote for austerity measures to secure a Troika agreement thus exposing dissent over a new austerity round vital for EU-IMF loans.
- GBP currency was firmer during the session underpinned by better than expected UK housing data and an upward growth revision for the UK economy by the CBI.

Political/ In the Papers:
- Debt buy-back emerging as likeliest strategy for Greece with proposal to extend debt target from 2020 to 2022 under discussion. Eurogroup to extend maturities on official loan but stressed that haircuts to Euro Zone loans off the table
-EU's Rehn: Greek parliament needs to adopt rescue package in time; Troika to present debt proposal before Nov 12th; Still have to decide how to lower Greece debt burden
-BoE's Bean: QE still lowering yields but lower yields may have a smaller impact than usual due to uncertainty
- (UK) The British PM Cameron narrowly lost a nonbinding but symbolic UK parliamentary vote on EU budget; He stated he would not support an EU Commission proposal to increase the overall budget by 5% for the 7-yr period ended 2020, arguing it should rise only in line with inflation

***Looking Ahead***
***All times listed for economic events are denominated in Eastern Standard Time (Add 4 hours for GMT equivalent)
- (CZ) Czech Oct Budget Balance (CZK): No est v -71.4B prior
- (RO) Romania Oct Total International Reserves: No est v $37.0B prior
- (RU) Russia Gold & Forex Reserve w/e Oct 26th: No est v $529.4B prior
- (RU) Russia Oct Reserve Fund: No est v $61.5B prior' Wellbeing Fund: No est v $87.6B prior
- 06:00 (DK) Danish Oct PMI Survey: No est v 50.1 prior
- 06:00 (EU) Daily Euribor Fixing
- 06:00 (SE) Sweden to sell I/L Bonds
- 06:30 (UK) DMO to sell £900M in 0.75% I/L 2047 Bonds; Avg Yield % v -0.116% prior; Bid-to-cover: x v 1.92x prior
- 07:00 (CZ) Czech Republic to sell 12-month Bills
- 07:00 (BR) Brazil Sept Industrial Production M/M: -0.5%e v +1.5% prior; Y/Y: -3.3%e v -2.0% prior
- 07:00 (IE) Ireland Oct Live Register Monthly Change: No est v -0.4K prior; Unemployment Rate: No est v 14.8% prior
- 07:00 (ZA) South Africa Sept Electricity Consumption Y/Y: No est v -1.3% prior; Electricity Production Y/Y: No est v +1.5% prior
- 07:30 (US) Oct Challenger Job Cuts Y/Y: No est v -70.8% prior
- 07:30 (US) Daily Libor Fixing
- 08:00 (BR) Brazil Oct PMI Manufacturing: 49.9e v 49.8 prior
- 08:00 (CZ) Czech Central Bank Interest Rate Decision: Expected to leave the Repo Rate unchanged at 0.25%
- 08:00 (US) Nov RBC Consumer Outlook Index: No est v 48.4 prior
- 08:15 (US) Oct ADP Employment Change: 135.0Ke v 162.0K prior
- 08:30 (US) Q3 Preliminary Nonfarm Productivity: 1.8%e v 2.2% prior; Unit Labor Costs: 0.8%e v 1.5% prior
- 08:30 (US) Initial Jobless Claims: 370Ke v 369K prior; Continuing Claims: 3.250Me v 3.254M prior
- 08:58 (US) Oct Final Markit US PMI: 51.3e v 51.3 prelim
- 09:00 (RO) Romania to sell Bonds
- 10:00 (US) Oct ISM Manufacturing: 51.0e v 51.5 prior; ISM Prices Paid: 56.5e v 58.0 prior
- 10:00 (US) Sept Construction Spending M/M: +0.7%e v -0.6% prior
- 10:00 (US) Oct Consumer Confidence: 73.0e v 70.3 prior
- 10:30 (US) Weekly EIA Natural Gas Storage Inventories
- 10:30 (US) IMF weekly briwfing
- 11:00 (MX) Mexico Central Bank Economist Survey
- 11:00 (MX) Mexico Sept Remittances: $1.9Be v $1.9B prior
- 12:30 (US) Fed's Lockhart speaks on the Economy in Tennessee
- 13:00 (BR) Brazil Oct Trade Balance: No est v $.6B prior; Exports: No est v $20.0B prior; Imports: No est v $17.4B prior
- 14:00 (MX) Mexico Oct IMEF Manufacturing Index: No est v 50.0 prior; Non Manufacturing Index: No est v 53.9 prior
- 17:00 (US) Oct Total Vehicle Sales: 15.00Me v 14.88M prior; Domestic Vehicle Sales: 11.48Me v 11.49M prior
- 17:00 (US) Fed's Rosengren speaks on Economic Outlook in Massachusetts

***Economic Data***
- (AU) Australia Oct RBA Commodity Price Index Au: 87.3 v 90.1 prior; RBA Commodity Index SDR Y/Y: -16.0% v -14.9% prior
- (UK) UK Nationwide House Prices M/M: 0.6% v 0.1%e; Y/Y: -1.2%e
- (IE) Ireland Oct NCB Manufacturing PMI: 52.1v 51.8 prior
- (SE) Sweden Oct Swedbank PMI Survey: 43.1 v 45.0e
- (TR) Turkey Oct Manufacturing PMI: 52.5 v 52.2 prior
- (DK) Denmark Sept Unemployment Rate: 4.8% v 4.8%e; Unemployment Rate Gross Rate: 6.3% v 6.2%e
- (NO) Norway Oct PMI: 48.7v 49.5e
- (ZA) South Africa Q3 Unemployment 25.5% v 25.0%e
- (CH) Swiss Sept Real Retail Sales Y/Y: 5.4% v 6.0% prior
- (HK) Hong Kong Sept Retail Sales Value Y/Y: 4.3% v 7.6%e; Retail Sales Volume Y/Y: % v 5.8%e
- (CH) Swiss Oct PMI Manufacturing: 46.1 v 44.7e
- (GR) Greece Oct Manufacturing PMI: 41.0 v 42.2 prior
- (ZA) South Africa Oct Kagiso PMI: 47.1 v 46.5e
- (UK) Oct PMI Manufacturing: 47.5 v 48.0e

Fixed Income:
- None