(ABM FN-Dow Jones) European stock markets will open higher on Monday.
IG predicts an opening gain of 61 points for the German DAX and a plus of 22 points for the French CAC 40. The British FTSE looks set to open 5 points higher.
Equity markets in Europe ended lower on Friday.
Investors were shocked by the news that SVB Financial, which focuses, among other things, on financing startups in Silicon Valley, has to issue new shares and sell assets at high discounts to prop up the balance sheet. Analysts also pointed to the bankruptcy of Silvergate, a bank that was primarily a lender to crypto companies.
Fears that the rapidly rising interest rates could also lead to a rapid increase in defaults led to sector-wide sell-offs for banks. Financials that are part of the S&P 500 fell on average by more than four percent on Thursday.
“This is an issue that can affect all banks, including the big banks, because since the financial crisis of 2007/2008, the banks have accumulated a lot of assets at rising prices, and they had to pay almost no compensation for bank deposits, because interest rates have been kept for so long. was close to zero,” said Swissquote Bank.
This afternoon we focused on the US jobs report. Job growth remained strong in February, but unemployment also rose, while wage growth cooled. The latter is convenient for the Federal Reserve, according to market analyst Philip Marey of Rabobank.
In Germany, final inflation was in line with preliminary readings. In the United Kingdom, the industry turned out to have produced less in January, but the fall of 0.3 percent was no surprise. British exports fell by almost 2 percent, imports fell by almost 9 percent. On a monthly basis, the United Kingdom did show slight economic growth again in January, after a contraction of half a percent in December.
Company news
European financials were under pressure on Friday. Deutsche Bank fell by more than 7 percent. Société Générale lost 4.5 percent, Crédit Agricole 2.5 percent. ING fell by more than 4.5 percent, just like Aegon.
Real estate struggled again. Vonovia lost more than 3 percent and Unibail-Rodamco-Westfield more than 2.5 percent.
In Paris, Eurofins Scientific took the lead, with a plus of almost 3 percent. Carrefour won almost one and a half percent. Schneider Electric and Legrand fell around 3.5 percent.
Fresenius Medical Care did good business in Frankfurt, with a profit of more than 2 percent. Profits were otherwise quite modest. Continental and Daimler Truck lost about 3.5 to 4.5 percent.
Euro STOXX 50 4.219,11 (-1,6%)
STOXX Europe 600 453,76 (-1,4%)
DAX 15.427,97 (-1,3%)
CAC 40 7.220,67 (-1,3%)
FTSE 100 7.748,35 (-1,7%)
SMI 10.765,26 (-1,7%)
AEX 743.03 (-1.4%)
BEL 20 3.746,75 (-2,0%)
FTSE MIB 27.281,96 (-1,6%)
IBEX 35 9.285,00 (-1,5%)
AMERICAN SHARES
On Monday, the US stock markets will have a big green opening, after finishing lower on Friday. On a weekly basis, the three major indexes lost about 4 to 5 percent, making it the worst week of 2023 so far.
Concerns about the American SVB Financial Bank, which focuses on financing startups in Silicon Valley, also weighed on sentiment on Friday. SVB Financial is now considering a sale. The regulator in California has now closed the bank and appointed a receiver.
Trading in SVB Financial was halted on Friday due to all the malaise, after having already fallen more than 60 percent on Thursday.
The market also looked to the US jobs report, which will play a key role in the Federal Reserve’s decision at its policy meeting later this month, as will inflation data next week.
In February there was a job growth of 311,000. The market had expected an increase of around 200,000 jobs. Unemployment was 3.6 percent in February. That was 3.4 percent in January. Economists expected a stable percentage for February.
Earnings per hour increased last month by $0.08 to $33.09. On an annual basis, this was an increase of 4.6 percent. This was calculated at 4.8 percent.
Job growth for January was adjusted from 517,000 to 504,000 and for December from 260,000 to 239,000.
“The labor data is as strong as it gets,” said market analyst Naeem Aslam of Zaye Capital Markets. “Now it is almost certain that the Fed will raise rates by 50 basis points at the next policy meeting,” he added.
According to market analyst Philip Marey of Rabobank, the jobs report suits the Fed well, in particular due to rising unemployment and the slowdown in wage developments.
With this report, the American labor market appears to be more balanced, also in terms of wage development. This means that the chance that the Fed opts for an interest rate hike of 50 basis points on March 22 seems somewhat smaller, says Marey, but a lot will depend on the inflation rate for February next Tuesday.
The US ten-year interest rate was quoted on Friday evening at 3.687 percent. Oil prices rose on Friday, benefiting from dollar weakness. At a settlement of $ 76.68, a barrel of West Texas Intermediate became 1.3 percent more expensive. On a weekly basis, the oil price lost almost 4 percent.
Company news
The problems at SVB put pressure on the financial sector. US Bancorp fell 4 percent and First Republic Bank around 15 percent. Goldman Sachs lost more than 4 percent.
Oracle closed more than 3 percent lower after disappointing quarterly figures.
DocuSign lost nearly 23 percent, even though the electronic signature software company reported profit last quarter, while revenue beat expectations.
Gap fell more than 6 percent after the clothing retailer reported a loss over the past quarter that was larger than a year earlier. Sales fell 6 percent to $4.2 billion.
S&P 500 index 3.861,59 (-1,5%)
Dow Jones index 31.909,64 (-1,1%)
Nasdaq Composite 11.138,89 (-1,8%)
ASIA
Asian stock markets are divided this morning.
Nikkei 225 27.744,73 (-1,4%)
Shanghai Composite 3.255,77 (+0,8%)
Hang Seng 19.672,01 (+1,8%)
VALUE
The euro/dollar was trading at 1.0719 this morning. On Friday evening, the coin pair was trading at 1.0640.
USD/JPY Yen 134,34
EUR/USD Euro 1,0719
EUR/JPY Yen 144,00
MACRO-AGENDA:
06:30 Bankruptcies – February (NL)
COMPANY NEWS:
07:30 Basic-Fit – Figures fourth quarter (NL)
Bron: ABM Financial News
The editors of follow from Beursplein 5 ABM Financial News developments on the stock exchanges, and the Amsterdam stock exchange in particular, closely. The information in this column is not intended as professional investment advice or as a recommendation to make certain investments.
