European stock markets open higher again

(APMFN-Dow Jones) European stock markets are heading for a significantly higher opening on Wednesday.

IG expects an opening gain of 227 points for the German DAX and a 110-point gain for the French CAC 40. The UK’s FTSE is looking to open 107 points higher.

Stock markets showed a somewhat fragile recovery on Tuesday.

On a volatile day, the indices moved above and below the zero line throughout the day. In the last hour, some support came from the US, where the recovery seemed to be gaining momentum.

Despite some bad days, ING remains positive. The weak July jobs report raised concerns of a looming recession and the need for a strong Fed response. However, the latest ISM services report suggests that the situation is looking good with the economy growing. ING does not expect a temporary rate cut from the Fed unless systemic risks arise.

At the moment, ING is leaning towards a 50bp cut in September, followed by a series of 25bp moves that would take us back to the Fed’s target of around 3% by the summer of next year, which is largely in line with the “neutral policy” stance of the central bank, said James Knightley, chief economist at ING.

Risers and Fallers

In Frankfurt, Siemens Energy led with gains of 3.3 percent, followed by SAP, which added 2.3 percent.

Bayer and Zalando lost 6.1 and 1.9 percent respectively after the figures.

In Paris, Airbus was among the gainers, with its share price rising 2.0 percent, after the aircraft manufacturer released figures on the number of aircraft delivered on Monday evening.

Kering and Teleperformance had a bad day, losing 2.6 and 3.0 percent.

In Amsterdam, the heavyweight ASML index was notable, adding 4.6 percent.

In Brussels, Umicore hit a 14-year low. The stock fell 3.0 percent to 11.62 euros.

In Switzerland, Adecco opened its books and the stock rose 0.3 percent.

Euro Stoxx 50 4,575.22 (+0.1%)
STOXX Europe 600 488.44 (+0.3%)
DAX 17,354.32 (+0.1%)
CAC 40 7,130.04 (-0.3%)
FTSE 100 8,026.69 (+0.2%)
SMI 11,510.46 (-0.3%)
EEX 866.70 (+0.7%)
Bill 20 3,887.99 (-0.0%)
FTSE MIB 31,107.13 (-0.6%)
IBEX 35 10,390.50 (-0.3%)

US Stocks

Wall Street is heading for a green open on Wednesday.

The United States staged a strong rebound on Tuesday, though it clawed back some of the previous day’s gains in the final hour. However, Wall Street clawed back some of the previous session’s losses.

All 11 sectors of the S&P 500 were positive for the day, led by real estate and financials.

Sentiment was boosted by a rebound in Japanese stocks. The Nikkei 225 average posted its best day since October 2008, rising 10.2 percent. The increase comes a day after the index’s worst day since 1987, when it lost 12.4 percent.

Despite some bad days, ING remains positive. The weak July jobs report raised concerns of a looming recession and the need for a strong Fed response. However, the latest ISM services report suggests that the situation is looking good with the economy growing. ING does not expect a temporary rate cut from the Fed unless systemic risks arise.

At the moment, ING is leaning towards a 50bp cut in September, followed by a series of 25bp moves that would take us back to the Fed’s target of around 3% by the summer of next year, which is largely in line with the “neutral policy” stance of the central bank, said James Knightley, chief economist at ING.

In terms of the overall economy, it was announced on Tuesday that US exports rose more strongly than imports in June. As a result, the trade deficit fell from $75.0 billion to $73.1 billion.

Otherwise, the agenda is relatively quiet. Most major companies, especially in the US, have already released their numbers, and in most cases central banks are also on summer vacation.

Oil prices managed to recover somewhat. West Texas Intermediate crude rose 0.4 percent to $73.20 a barrel, as recession fears appeared to give way to oil traders’ concerns about rising tensions in the Middle East.

US interest rates managed to recover and the 10-year rate rose by 11 basis points to 3.89 percent.

Risers and Fallers

A number of heavyweights gave the rally a boost, with Nvidia up nearly 4%, Meta up 3.9%, Microsoft up 1.1%, Amazon up 0.6%, and only Apple lagged behind with a 1.0% loss.

Caterpillar shares rose 3 percent after adjusted earnings per share came in stronger than expected. That was despite lower volume. Caterpillar attributed the 4 percent decline to lower volumes, which could only be partially offset by higher prices. Adjusted for exceptional items, earnings rose to $5.99 from $5.55. That was better than the market had expected.

Uber Technologies Inc. shares gained 10.9 percent after the company returned to profitability. Uber CEO Dara Khosrowshahi said Uber’s growth engine continues to fire, with rides now up more than 20 percent for six straight quarters.

Yum Brands rose 2.7 percent. The parent company of KBC and Taco Bell, for example, reported better-than-expected earnings, though trading volume was somewhat disappointing.

Data analytics company Palantir rose 10.4 percent after raising full-year revenue guidance.

Walt Disney shares rose 2.5 percent after the company announced it would raise prices for Disney+, Hulu and ESPN+ in mid-October. The price increases come as Disney continues to push customers toward bundles to get more value for their money. Disney will report its third-quarter financial results before the bell on Wednesday.

Data center company Super Micro Computer missed analysts’ estimates for its fiscal fourth quarter on Tuesday and gave a mixed outlook for the current period. But it announced a 10-for-1 stock split. Shares of Super Micro Computer fell nearly 7 percent in after-hours electronic trading Tuesday.

Rivian again posted a slightly larger-than-expected loss in the second quarter, while revenue was in line with consensus. Rivian shares fell about 2 percent in after-hours trading on Wall Street.

S&P 500 5,240.03 (+1.0%)
Dow Jones 38,977.66 (+0.8%)
Nasdaq Composite 16,336.85 (+1.0%)

Asia

Asian stock markets were in the green on Wednesday, with the Japanese stock market continuing a clear recovery.

Nikkei 225 35,649.16 (+2.8%)
Shanghai Composite 2,876.17 (+0.3%)
Hang Seng 16,864.92 (+1.3%)

Currencies

The EUR/USD was trading at 1.0912 this morning. On Tuesday evening, the currency pair was trading at 1.0931.

USD/JPY 147.62 Yen
EUR/USD EUR 1.0912
EUR/JPY 161.11

Overall agenda:
08:00 Trade Balance – June (Today)
08:00 Industrial Production – June (National Day)
1:00 PM Mortgage Applications – Weekly (US)
4:30 PM Oil Inventories – Weekly (US)
9:00 PM Consumer Credit – June (US)

Company News:

07:00 ABN AMRO – Q2 figures
07:00 Ahold Delhaize – Q2 figures
7:00 Beiersdorf – Q2 figures (DLD)
07:00 Commerzbank – Q2 figures (DLD)
07:00 Moller-Maersk – Q2 figures (D)
07:00 Siemens Energy – Q4 figures (Germany)
08:00 Deliveroo – Q2 figures (UK)
1:00 PM Lyft – Q2 Numbers (US)
22:00 Beyond Meat – Q2 Numbers (US)
22:00 Disney – Q3 Numbers (US)

Source: ABM Financial News

ABM Financial News is a resource for stock market news, video and data, both for trading platforms and real-time trading rooms and for online and offline media publications. The information contained in this article is not intended to constitute professional investment advice or a recommendation to make specific investments.