Stock Market Update – Europe gains broadly as tax bill boosts sentiment; US markets expected to open higher
December 4, 2017 12:26 pm
In Asia, the Japanese Nikkei 225 and Topix indices both finished the day lower by 0.5%. Hong Kong’s Hang Seng rose by 0.2%, while the Shanghai Composite retreated by the same proportion. Australia’s S&P/ASX 200 slid by 0.1%.
It is interesting that Asian equities didn’t benefit from upbeat sentiment following the passage of the much-talked tax bill by the US Senate over the weekend, neither – in the case of Japanese stocks –from the rising dollar/yen pair.
European bourses however, traded broadly in the green around midday. The Stoxx was 0.8% higher, with all industry sectors constituting the pan-European gauge being in the green. The blue-chip Euro Stoxx 50 traded up by 1.0%.
The UK’s FTSE 100, German DAX and French CAC 40 were up by 0.8%, 1.2% and 1.0% respectively.
Equities in Europe were boosted on both positive sentiment following the US tax vote but also on weakening currencies on the back of a broadly stronger dollar during today’s trading; certain European benchmarks’ heavy export-orientation allows them to benefit in such cases.
Financials, which stand to benefit significantly from tax cuts, were posting hefty gains. The Stoxx 600 Banks sub-index was last up by 1.15% with BPER Banca, Barclay’s, Credit Suisse and Commerzbank leading the gains; all of them were up by more than 2.0%.
Chipmakers Ams AG (up 5.3%) and Dialog Semiconductor (down 18.3%) led gains and losses respectively within the Stoxx 600. The former saw Barclay’s upgrade it to “overweight” from “equal-weight” as well as raise its price target on the firm, and the latter tumbled after it said its top customer Apple could be working on building its own power-management chips. Despite Dialog adding that it expects no impact on its business next year, this didn’t manage to prevent investors from getting spooked.
Airbus (up 3.0%) was the top performer within the CAC 40 as well as one of the best performers within the Stoxx 600 after the plane-maker said it anticipates to deliver a record number of aircrafts in 2017.
Swedish-based retailer H&M (down 0.9%) was on a negative footing after Goldman Sachs downgraded its stock to “sell” from “neutral”.
Pertaining to Brexit, a meeting involving UK PM Theresa May and European Commission President Jean-Claude Juncker is generating attention. Also, eurozone finance ministers are meeting today to vote for a new Eurogroup president as well as review Greece’s bailout program.
Futures markets were last projecting a higher open on Wall Street; Dow, S&P 500 and Nasdaq 100 contracts were up by 0.9%, 0.6% and 0.5% respectively. Upbeat sentiment by tax cuts could – at least partially – be dented by developments relating to the probe on the involvement of Russia in last year’s US presidential elections. Discussions to reconcile the Senate and House’s respective versions of the tax bill are expected to get underway this week.
In Asia, the Japanese Nikkei 225 and Topix indices both finished the day lower by 0.5%. Hong Kong’s Hang Seng rose by 0.2%, while the Shanghai Composite retreated by the same proportion. Australia’s S&P/ASX 200 slid by 0.1%.
It is interesting that Asian equities didn’t benefit from upbeat sentiment following the passage of the much-talked tax bill by the US Senate over the weekend, neither – in the case of Japanese stocks –from the rising dollar/yen pair.
European bourses however, traded broadly in the green around midday. The Stoxx was 0.8% higher, with all industry sectors constituting the pan-European gauge being in the green. The blue-chip Euro Stoxx 50 traded up by 1.0%.
The UK’s FTSE 100, German DAX and French CAC 40 were up by 0.8%, 1.2% and 1.0% respectively.
Equities in Europe were boosted on both positive sentiment following the US tax vote but also on weakening currencies on the back of a broadly stronger dollar during today’s trading; certain European benchmarks’ heavy export-orientation allows them to benefit in such cases.
Financials, which stand to benefit significantly from tax cuts, were posting hefty gains. The Stoxx 600 Banks sub-index was last up by 1.15% with BPER Banca, Barclay’s, Credit Suisse and Commerzbank leading the gains; all of them were up by more than 2.0%.
Chipmakers Ams AG (up 5.3%) and Dialog Semiconductor (down 18.3%) led gains and losses respectively within the Stoxx 600. The former saw Barclay’s upgrade it to “overweight” from “equal-weight” as well as raise its price target on the firm, and the latter tumbled after it said its top customer Apple could be working on building its own power-management chips. Despite Dialog adding that it expects no impact on its business next year, this didn’t manage to prevent investors from getting spooked.
Airbus (up 3.0%) was the top performer within the CAC 40 as well as one of the best performers within the Stoxx 600 after the plane-maker said it anticipates to deliver a record number of aircrafts in 2017.
Swedish-based retailer H&M (down 0.9%) was on a negative footing after Goldman Sachs downgraded its stock to “sell” from “neutral”.
Pertaining to Brexit, a meeting involving UK PM Theresa May and European Commission President Jean-Claude Juncker is generating attention. Also, eurozone finance ministers are meeting today to vote for a new Eurogroup president as well as review Greece’s bailout program.
Futures markets were last projecting a higher open on Wall Street; Dow, S&P 500 and Nasdaq 100 contracts were up by 0.9%, 0.6% and 0.5% respectively. Upbeat sentiment by tax cuts could – at least partially – be dented by developments relating to the probe on the involvement of Russia in last year’s US presidential elections. Discussions to reconcile the Senate and House’s respective versions of the tax bill are expected to get underway this week.
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