EUROPEAN EQUITY UPDATE: Earlier positivity wanes as APAC’s mixed picture reverberates into Europe

Analysis details (08:59)

• European bourses began the session on the front foot with gains of circa. 0.4/0.5% across the board, but have since pulled back from best levels despite a lack of fresh catalysts. APAC markets saw a mixed session but tech outperformed, in fitting with price action seen on Wall Street yesterday, which saw the SPX and NDX lifted by NVIDIA, whilst the DJIA and R2K were subdued. US equity futures traded horizontally overnight but saw a slight uptick shortly after the cash open, in tandem with Europe, but have since pulled back. Newsflow has been relatively light and as such action has been choppy and rangebound awaiting debt ceiling developments. It’s also worth noting that with the long weekend coming up for the UK and US, participants may not want to hold onto risk as debt ceiling negotiations continue.


• Back in Europe, bourses now paint a mixed picture (Euro Stoxx 50 Unch, Stoxx 600 +0.1%), fitting with the APAC and US price action. The AEX (+0.2%) once again outperforms, albeit narrowly, with regional giant ASML (+1.8%) once again carrying the Dutch and EZ-wide indices. Sectors in Europe are mixed (vs a mostly positive open). Basic Resources outperform as base metals claw back some recent losses, with Tech the next best performance as NVIDIA’s surge continues to reverberate globally. The downside meanwhile consists of Utilities, Telecoms, and Banks.


• In terms of individual movers, Glencore (+2.3%) is underpinned by the attempted recovery in base metals as it overlooks reports Nippon Steel remains in discussion with Teck Resources despite the Glencore bid. AstraZeneca (+0.8%) helps to keep the Healthcare sector among the top performers after the Co’s Imfinzi plus Lynparza and Imfinzi alone both significantly improved progression-free survival in advanced endometrial cancer when added to chemotherapy. Casino (-4.7%) falls while reports suggested Les Mousquetaires is to take a minority stake in the future financing round, an equity investment of EUR 100mln. Atos (ATO FP) rises as US Court of Appeals has issued a favourable decision for Atos in the Trizetto litigation.

26 May 2023 - 09:03- EquitiesResearch Sheet- Source: Newsquawk