EUROPEAN EQUITIES UPDATE: Stocks move a little higher, RNO FP benefits from Nissan merger talks

STOXX 600: +0.1%

• European bourses began the European session on either side of the unchanged mark to display a mixed open; since, sentiment has improved a touch with most indices managing to climb incrementally into the green.


• EZ-specific updates have been light today aside from commentary from ECB’s Wunsch and Lane; the latter ultimately echoed much of the remarks in President Lagarde’s most recent press conference – “it is prudent to maintain agility on a meeting-by-meeting basis and not pre-commit to any particular rate path”.

Sectors: Mixed

• European sectors are mixed, in-fitting with the indecisive price action seen in the complex thus far.


• Energy takes the top spot, lifted by strength in underlying oil prices; Media follows closely behind.


• In the banking sector, UniCredit (+0.5%) upped its stake in Commerzbank (+2.9%) to 28% (prev. 21%); the Italian bank also applied to the ECB for permission to acquire a stake of up to 29.9%.


• Basic Resources are found at the foot of the sector list, with metals prices continuing to extend the losses seen in the prior session. Chemicals and Food Bev & Tobacco are also on the backfoot.

Major Indices: FTSE 100 +0.3%, CAC 40 +0.3%, DAX 40 +0.3%

• The FTSE 100 is on a slightly firmer footing, in contrast to the hefty losses seen in the prior session. Today we got the UK’s inflation report for November; the metrics were largely in-line or slightly cooler than expectations, which all but confirms a hold at Thursday’s BoE meeting. Stock specifics are a little light for the index today; AstraZeneca (-0.5%) dips a little lower amid reports that execs expect an “evident” revenue hit in China in the wake of the arrest of its China head Wang.


• The CAC 40 is incrementally firmer, with Renault (+5.4%) at the top of the pile; the French automaker holds a 36% stake in Nissan shares, with the Japanese automaker soaring around 24% in overnight trade amid merger talks with Honda.

US Equity Futures: ES +0.1%, NQ +0.1%, RTY +0.1%

• Futures are very modestly in the green in-fitting with the price action seen in Europe, but also as traders eye the looming FOMC Policy Announcement.


• The FOMC is expected to lower its Federal Funds Rate target by 25bps to 4.25-4.50% at its December 18th confab, according to a Reuters survey. Analysts then expect the central bank to pause on rates in January, amid some concerns about rising inflation risks, with price pressures potentially set to rise due to President-elect Trump's proposed tariffs and tax cuts. The 2025 dot plot is expected to show 3 cuts vs. prev. 4 cuts.


• In pre-market trade, Tesla (-3.5%) is on the backfoot amid reports that China factory Song Gang is to leave the co.; in the past month, the EV giant has risen north of 40%, so the pull-back may also attributed to some profit-taking ahead of Quad Witching on Friday.

18 Dec 2024 - 09:55- Fixed IncomeResearch Sheet- Source: Newsquawk