Ger30, UK100 and SP500 are CFD’s, written over the Dax30, Footsie100 and S&P500 Index futures:
In the pre-opening, European equities were traded with some losses. As in the previous session, the first stage will be dominated by the reaction to results published before opening. Among the others, the results from Deutsche Bank gain primacy. The German bank reported net income of 256 M €, which exceeded forecasts for a loss of 394 M €. These results were grounded by the increase in trading revenues in currencies and bonds (+ 14%) and decreased costs. The core capital Tier 1 ratio increased from 10.80% in the previous quarter to 11.10%. The German bank increased provisions to match the hypothetical legal costs associated with the litigation in which is involved, from 5000 M € to 5900 M €. The CEO of the bank said that the negotiations with the US authorities are continuing and that the bank is making every effort to be successful. In a comparative analysis, these results exceed forecasts but its performance is lagging behind by its American and European counterparts. Still within the banking sector should be noted that both BBVA and Barclays reported profits higher than anticipated, supported by the good performance of the trading unit and also by the sale of assets in the case of the Spanish bank. The Swiss engineering company ABB reported earnings and revenue higher than expected. Telefonica presented a higher profit than estimated in line with expected revenue but reduced the dividend. Volkswagen will publish its quarterly accounts in the morning. The release of the English GDP for the 3rd quarter should also attract the attention of investors, although the effects of Brexit in this period must have been quite tenuous.
US equities closed with moderate losses. The disappointing results of Apple and the weakness of oil were offset by the good results of other companies, including Boeing. On the other hand, the positive signals of some indicators contributed to provide some resiliency for the US market. Oil continues to be an influential variable in the current panorama of the equity markets. Yesterday, crude oil closed at 49.20 (-1.60%), a particularly volatile session, on the day the Energy Department showed a drop of oil reserves (-553 thousand barrels), against the predictions and calculations published on Tuesday by the American Petroleum Institute. Gasoline reserves suffered a higher decline than estimated. Shares of Apple were the main cause of the fall of the Nasdaq. The title lost 2.25%, affecting many technology stocks, with investors questioning the company’s ability to increase sales. Today, Apple has scheduled an event where it is expected to present a new laptop and desktop for its line of computers. The trade deficit (related only to goods and excluding services) decreased in September from 59100 M.USD to 56100 M.USD, well below the 60,500 M.USD anticipated. Regarding the real estate market, new home sales reached 593,000 in September, 3.10% above the figure registered in August, but below the 610,000 predicted.
Asian markets closed lower, penalized by the weakness in oil shares. After a volatile session yesterday, when it lost 1.60%, crude oil traded in Asia with contained variations.