European stocks are expected to open significantly lower

(ABM FN-Dow Jones) European stocks will open lower on Tuesday.

IG foresees an opening loss of 232 points for the German DAX, a minus of 111 points for the French CAC 40 and a decrease of 86 points for the British FTSE 100. Today’s Group asset manager Cees Smit points to fears about the new corona variants, causing the opening threatens to be lower.

On Monday, the stock markets in Europe partly recovered from the strong blows from before the weekend. “After Friday’s strong sell-off, it looks like we’re in for a wild ride this week as we head towards the end of the year,” predicts CMC Markets market analyst Michael Hewson.

“We have always known that new variants could become a problem, but in the last 12 months there have been many reports about the dangers of new variants, but these reports did not shock the market as much as last Friday,” he said. hewson.

According to Hewson, the first reports in South Africa show that despite many infections, there are still no reports of hospitalizations or deaths as a result of the new variant.

“That’s why the market reaction on Friday was so striking.” There is still a lot of uncertainty about the treatment of the omicron variant, its infectivity and the efficiency of vaccines.

On a macroeconomic level, it was announced on Monday that inflation in Germany rose further in November, to 5.2 percent.

According to ING economist Carsten Brzeski, the reasons for the high inflation in Germany are now well known; a temporary reduction in VAT and high energy prices. Still, according to Brzeski, it will take until the end of 2022 or early 2023 for inflation in Germany to fall below 2 percent again.

Consumer confidence in the eurozone weakened further in November, as expected. The index fell from minus 4.8 to minus 6.8.

Company news

Shares that were under considerable pressure on Friday managed to recover on Monday. In addition to financials and energy funds, luxury goods manufacturers and insurers also did well.

In Paris, Kering led the way with a plus of 2.8 percent, with Unibail-Rodamco-Westfield and STMicroelectronics winning 2.6 percent. Carrefour was the biggest loser, losing 2.0 percent.

In Frankfurt, the DAX was led by RWE, with a gain of 2.7 percent, while E.ON gained 1.8 percent and Delivery Hero rose 2 percent. Continental lost more than 4 percent.

Euro STOXX 50 4,110.42 (+0.5%)
STOXX Europe 600        467,24 (+0,7%)
DAX                  15.280,86 (+0,2%)
CAC 40 6,776.25 (+0.5%)
FTSE 100 7,109.95 (+ 0.9%)
SMI 12,220.74 (+ 0.2%)
AEX                     787,01 (+0,7%)
BEL 20 4,139.68 (+ 0.3%)
FTSE MIB             26.041,55 (+0,7%)
IBEX 35               8.455,20 (+0,6%)

US EQUITIES

Wall Street opens lower Tuesday, according to US futures.

The American stock markets partly recovered on Monday from the strong blow to the weekend, when the markets were shocked by a new corona variant.

“Friday was sold in a panic,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank. Investors had time to catch their breath over the weekend. Also, Ozkardeskaya noted that due to Thanksgiving late last week, trading volumes were lower, likely exacerbating the losses.

Now investors are waiting for more clarity about the transmissibility and severity of the omicron variant and whether the current vaccines are efficient. Some asset managers fear that the new variant will jeopardize global mobility and economic recovery.

Others expect the economic impact of the variant to remain limited as manufacturers update their vaccines to combat the corona variant.

“We know that in a situation like this the wind can turn very quickly. We can get one piece of news and [de markt duikt] again in the red,” said Ozkardeskaya.

“Despite the irresistible pull of buy-the-dip due to dubious early indications about Omicron, we are only one negative news item away from a return to panic,” added Jeffrey Halley, senior market analyst at Oanda. Halley expects this week’s headlines to shake markets.

US President Joe Biden said Monday there is no need to panic regarding the omicron variant. He therefore does not expect new lockdowns to curb a possible outbreak.

On a macroeconomic level, it was announced that upcoming home sales in the United States rose by 7.5 percent in October, after falling in September.

Two US jobs reports will follow later this week, with official employment figures released on Friday.

“The number of new jobs may again exceed 550,000. However, the unemployment rate is at least as important. After all, that figure also influences the labor supply: how many people are looking for a job. That number remains too low for the time being. labor market, lead to higher wages and ultimately prevent further growth of the economy,” said economist Luc Aben of Van Lanschot Kempen.

The oil price partially recovered from the corona blow before the weekend. At a settlement of $69.95, a barrel of West Texas Intermediate became 2.6 percent more expensive.

Analysts at Sevens Report expect that “as long as there are no new lockdowns that derail the economic recovery, oil prices will stabilize.”

Analysts further believe that the sharp sell-off late last week gives the largest oil producers a reason to postpone planned production increases. OPEC and its allies are talking this week about the new corona variant and the impact on oil demand. A standard meeting was already planned for Thursday, but this will now mainly focus on omicron.

“The group is not known for making hasty decisions,” according to Rystad Energy analyst Louise Dickson, who predicts OPEC will either maintain its existing agreement to increase production by 400,000 barrels per day each month or become more cautious until more. is clear about the impact of the new corona variant.

Company news

Moderna announced on Sunday that it will have a vaccine against the omicron variant ready within a month and a half. The stock rose nearly 12 percent. Pfizer and BioNTech are also working on a modified vaccine, CNBC reported. Pfizer fell 3 percent and BioNTech gained 4 percent.

Industry peer Merck fell more than 5 percent after a Citigroup advice cut. On Tuesday, the FDA’s advisory committee will consider the company’s corona pill. The efficacy would be a lot lower than initially thought.

Jack Dorsey, the CEO and founder of Twitter, plans to step down from the social media company and will be succeeded by chief technical officer Parag Agrawal. The company announced this on Monday, after reports had already appeared in the media. The stock fell nearly 3 percent at the end.

Also personnel changes at Walmart, which is looking for a new CFO. Brett Briggs, who has been CFO since 2016, is leaving. The stock fell more than 1.5 percent.

Microsoft CEO Satya Nadella sold $285.3 million worth of Microsoft stock early last week. In total, Nadella sold 838,584 shares of Microsoft for $340.26 each. The stock closed Friday at $329.68. On Monday, the stock closed more than 2 percent higher at $336.63.

Amazon is rapidly expanding its distribution network to meet the surge in demand during the pandemic. In two years, the number of distribution centers in the US has doubled to more than 450, logistics consultant MWPVL reported. The stock rose more than 1.5 percent.

Retailers like Macy’s and Best Buy failed to convince on Cyber ​​Monday, losing about 2 to 3 percent. Adobe reported that US retailers may have recorded their year’s highest online sales on Cyber ​​Monday, but may be lower than a year earlier.

Car rental company Hertz wants to buy shares for 2 billion dollars. The stock rose 6 percent.

S&P 500 index                4.655,27 (+1,3%)
Dow Jones index             35.135,94 (+0,7%)
Nasdaq Composite            15.782,83 (+1,9%)

ASIA

Asian stocks were lower on Tuesday.

Nikkei 225             28.069,89 (-0,8%)
Shanghai Composite     3.559,87 (-0,1%)
Hang Seng 23,319.93 (-2.2%)

EVALUATE

The euro/dollar was trading at 1.1309 this morning. As the US markets closed on Monday, the currency pair moved at 1.1280.

USD/JPY Yen   113,17
EUR/USD Euro  1,1309
EUR/JPY Yen   127,97

MACRO-AGENDA:
08:00 easyJet – Annual figures (UK)
22:00 GlobalFoundries – US Third Quarter Figures
22:00 Hewlett Packard – US Fourth Quarter Figures

COMPANY NEWS:
00:50 Industrial production – October vlpg (Jap)
03:00 Industry and Services Purchasing Managers Index – November (Chi)
06:30 Retail sales – October (NL)
06:30 Producer Awards – October (NL)
08:45 Economic growth Third quarter final. (fra)
08:45 Inflation – November vlpg. (From)
09:55 Unemployment – October (Ger)
11:00 Economic growth – Third quarter (Bel)
11:00 Inflation – November vlpg. (eur)
15:00 Case Shiller House Prices – September (US)
15:45 Chicago Purchasing Managers Index – November (US)
4:00 PM Consumer Confidence Conference Board – November (US)

Bron: ABM Financial News

From Beursplein 5, the editors of ABM Financial News keep a close eye on developments on the stock exchanges, and the Amsterdam stock exchange in particular. The information in this column is not intended as professional investment advice or as a recommendation to make certain investments.

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