EUROPEAN EQUITY OPEN: Stocks open higher on Friday, but are currently on course to snap five weeks of gains; Europe regional inflation metrics mixed thus far

OVERNIGHT: Asia-Pac stocks were positive as the region took impetus from the rally on Wall St where the S&P 500 and DJIA posted their best daily performance since January, as sentiment was fuelled by strong earnings results, while the region also digested a slew of earnings, month-end data releases and the BoJ policy decision. The central bank kept policy unchanged, and sees inflation falling below 2% in FY25; it also said it would conduct a review into its policy measures, which would be out in 12-18 months, which analysts suggested implies status quo policy in the near term. China shares were firmer amid tech strength and an abundance of earnings releases, with sentiment also supported by the PBoC’s liquidity efforts ahead of the 5-day closure in the mainland for Labour Day Golden Week. Our Full APAC wrap can be accessed here.

EUROPEAN OPEN: The European day starts with some gains, though the broad (Stoxx 600) and narrow (Euro Stoxx 50) gauges of European equities are both currently on course to snap five weeks of gains; the narrative is subject to change given that we have Eurozone GDP later today, and traders will begin to focus on Eurozone inflation data due next Tuesday. The US PCE and ECI data due in the afternoon could also sway the risk tone heading into the long weekend. Regional German inflation metrics have begun coming in, and so far, the bias appears to the downside after North Rhine-Westphalia State reported April CPI of 6.8% Y/Y (from 6.9%). Spanish inflation metrics also came in lower than expected (HICP rose to 3.8% Y/Y vs exp. 4.1%, with the core measure falling to 6.6% Y/Y from 7.5%), though French data metrics for April were above expectations (HICP at 6.9% Y/Y vs exp. 6.6%). Elsewhere, data showed that German import prices fell -3.8% Y/Y in March (exp. -3.6%); the aggregated German data is due this afternoon, and while national CPI is seen easing to 7.3% Y/Y from 7.4%, the HICP measure is seen unchanged at 7.8% Y/Y.

STOCK SPECIFICS: Consumer discretionary/Big Tech names will note Amazon.com Inc (AMZN) Q1 metrics beat across the board, although the tone on call was more cautious, with execs noting a slowdown in AWS into Q2. In tech, Intel Corp (INTC) beat top- and bottom-line expectations, rising almost 5.0% in afterhours trading, but still reported the largest quarterly loss in its history. On the M&A front, Canada opposition party calls for the government to block Glencore (GLEN LN) proposed takeover of Teck Resources (TECK); Deutsche Bank (DBK GY) to buy Numis (NUM LN) for GBP 3.50/shr (vs GBP 2.04 close on Thursday). In consumer discretionary, Mercedes-Benz (MBG GY) sales topped estimates in Q1 on performance of top-end models and pricing actions. In financials, NatWest Group (NWG LN) topped profit forecasts in Q1 despite UK inflation, but saw deposits fall by GBP 19.8bln in the quarter; Prudential (PRU LN) quarterly new business profits +30% in the quarter at GBP 743mln. Financials will also note a story from Reuters which said US officials have reportedly coordinated urgent rescue talks for First Republic Bank (FRC). In materials, Covestro (1COV GY) guides FY23 core earnings above expectations on better margins and improved costs; Wacker Chemie (WCH GY) saw a smaller than expected fall in Q1 core profits; Norsk Hydro (NHY NO) core profits declined by less than expected. In energy, OMV (OMV AV) clean CCS operating results were above expectations; Eni (ENI IM) net profits fall, but still top expectations; cuts FY operating profit view. In communications, ProSiebenSat.1 (PSM GY) will cut its dividend, and replace its CFO; Pearson (PSON LN) said strong performance in Q1 puts it on track to meet forecasts. T-Mobile US Inc (TMUS) slipped 2.6% afterhours after sales missed expectations, and added fewer subscribers than the street expected. In staples, Remy Cointreau (RCO FP) warned that weak US demand will hit sales ahead. Our full stock specific briefings for April 24th can be accessed here and here.

DAY AHEAD:

 

28 Apr 2023 - 08:10- Fixed IncomeData- Source: Newsquawk

InflationDataGermanyGross Domestic ProductCentral BankFixed IncomeUnited StatesConsumer Price IndexFederal ReserveEuropePSM.GYTMUS.USPSON.LNOMV.AVENI.IMRCO.FPAA.USAMZN.USINTC.USGLEN.LNDBK.GYPRU.LNFRC.USWCH.GYNHY.NOFranceGBPPurchasing Manager IndexBaker Hughes IncCVXEni SpADow Jones Industrial AverageBoJPBoCEUREquitiesSpainAmazon.com IncAMZNIntel CorpINTCGlencore PLCGLENDeutsche Bank AGDBKMBGNWGPrudential PLCPRU1COVWacker Chemie AGOMV AGPearson PLCPSONT-Mobile US IncTMUSRemy Cointreau SAEuropean OpeningBroadline RetailBroadline Retail (Group)CanadaHighlightedEU SessionResearch SheetAsian SessionSwedenUnited KingdomChinaItaly

Subscribe Now to Newsquawk

Click here for a 1 week free trial

Newsquawk provides audio news and commentary for over 15,000professional traders and brokers worldwide. Services include: