(ABM FN-Dow Jones) The European stock markets open lower on Wednesday. IG predicts an opening loss of 35 points for the German DAX, a minus 12 points for the French CAC 40 and a 5 point drop for the UK FTSE 100.
European stock markets closed mixed on Tuesday after reassuring news on the eurozone economy and a lower start on Wall Street.
“The market sees a reduced risk of a recession,” SEB analysts said. And that was confirmed by figures from S&P.
The eurozone economy grew again in January, according to the composite index of services and manufacturing, which rose from 49.3 to 50.2. This is higher than the economists’ forecast of 49.7 and also clearly better than in the US.
“The eurozone is back in growth mode in early 2023,” S&P said. A sign that the euro zone may be able to avoid a recession, S&P economist Chris Williamson said in a statement. But, warns the economist, “we are not there yet”. Demand continues to fall, and if inflation picks up again, that also reinforces calls for more interest rate hikes.
Later on Tuesday, data from S&P showed that the US economy still contracted sharply in January, although less than in December.
Pharmaceuticals and retailers were the worst losers, while technology and insurance won. Miners also lost ground, although gold prices rose slightly.
“A weaker dollar, China’s reopening and a slowing global economy have helped the precious metal up in recent months,” said AJ Bell’s Laith Khalaf.
In Paris, advertising firm Publicis was the strongest climber, followed by Engie. Eyewear maker EssilorLuxottica and shampoo maker L’Oreal finished bottom with limited losses.
In Frankfurt, there were positive results for the energy companies E.ON and RWE and the transport manufacturers Daimler Truck and Airbus. Reinsurance company Muenchener Rueckversicherungen finished at the top with a profit of 1.7 per cent.
The retailer Zalando lost 2.3 percent and Sartorius ended at the bottom with a loss of 3.8 percent.
Euro STOXX 50 4,153.02 (+0.05%)
STOXX Europe 600 453.38 (-0.24%)
DAX 15,093.11 (-0.07%)
CAC 40 7,050.48 (+0.26%)
FTSE 100 7,757.36 (-0.35%)
SMI 11,406.29 (+0.06%)
AEX 746.40 (-0.20%)
BEL 20 3,882.65 (-0.18%)
FTSE MIB 25,884.31 (+0.24%)
IBEX 35 8,967.10 (+0.26%)
Wall Street opens lower Wednesday, according to US futures.
U.S. stock markets closed mixed on Tuesday after weak purchasing managers’ indexes and corporate earnings generated mixed reactions.
“The test of the market is this week and next week,” said Quincy Krosby of LPL Financial. In particular, the tone of the outlook provided by companies will be decisive. For now, she gives that note “an adequate” but not yet high rating. However, the market has rallied since the start of quarterly numbers, with the S&P 500 up 3 percent over the past two trading days.
On Tuesday, dozens of stocks on the New York Stock Exchange temporarily halted trading, including Verizon, Nike, McDonald’s, AT&T and Morgan Stanley. It remained unclear why.
In the afternoon, S&P published figures on the US economy. Economic activity fell less sharply in January but remained very weak, according to economist Chris Williamson. The composite index went from 45.0 to 46.6. A figure of 50 indicates zero growth.
There were many business numbers.
General Electric delivered more profit than expected, but the outlook was bleak compared to analysts’ estimates. Demand for jet engines and power grid equipment was strong. The stock closed 1.2 percent higher.
3M performed at the lower end of expectations for 2022. Adjusted earnings per stock at $10.10 was at the lower end of the range released in October, following a previous low of 10.30. The share lost 6.2 per cent.
Halliburton reported a better-than-expected profit, while the oil services company’s revenue rose from $4.3 billion to $5.6 billion. The share lost 1.8 per cent.
Johnson & Johnson closed nearly flat, recovering from a dip in early trading. The pharmaceutical company had 26 percent less profit in the quarter, but the adjusted result was still better than expected. Revenue also fell less than expected, by 4 percent.
The US justice system will sue Google owner Alphabet over its dominance of the digital advertising market, Bloomberg news agency reported on Tuesday, citing sources. The Alphabet share closed down 2 percent.
After the market, the technology giant Microsoft came up with figures. Revenue growth was disappointing, particularly in personal computer sales, but because growth in the Azure cloud division was better than expected, the stock rose 4 percent after the close.
Chipmaker Texas Instruments also reported aftermarket results. “As expected, demand was weaker in all end markets except automotive,” CEO Rich Templeton confirmed moderate expectations. The stock moved little after the close.
S&P 500 Index 4,016.95(-0.07%)
Dow Jones Index 33,733.96 (+0.31%)
Nasdaq Composite 11,334.27 (-0.27%)
Japanese stock markets were slightly higher on Wednesday. Chinese stock markets remained closed.
Nikkei 225 27,396.33 (+0.4%)
Shanghai Composite 3,264.81 (close Jan 20)
Hang Seng 22,044.65 (closes January 20)
Euro/dollar was quoted at 1.0893. At the close of US stock markets on Tuesday, the currency pair was still trading at 1.0884, and at the close of European stock markets, 1.0871 was on the boards.
USD/JPY Yen 130.52
EUR/USD Euro 1.0893
EUR/JPY Yen 142.17
00:00 Chinese markets closed for Chinese New Year
10:00 Ifo Business Confidence – January (German)
13.00 Mortgage applications – weekly (US)
16:30 Oil Stocks – Weekly (USA)
13:00 AT&T – US figures for the fourth quarter
13:00 Abbott Laboratories – US figures for the fourth quarter
13:00 Boeing – Figures for the fourth quarter (USA)
13:00 Kimberly-Clark – US Fourth Quarter Figures
22:00 IBM – US figures for the fourth quarter
22:00 Tesla – US figures for the fourth quarter
Source: ABM Financial News
From Beursplein 5, the editorial team at ABM Financial News closely follows developments on the stock exchanges, and in particular the Amsterdam Stock Exchange. The information in this column is not intended as professional investment advice or as a recommendation to make certain investments.