EUROPEAN EQUITY UPDATE: Steady trade as US absence saps market direction

Analysis details (09:25)

It’s been an incredibly tame start to the session for European equities (Stoxx 600 -0.1%) with the Stoxx 600 on track to close the week out with gains of around 1.7%. The handover from the APAC session was an equally indecisive one with macro newsflow light asides from a Reuters sources piece noting that the PBoC is to provide loans via relending facilities to financial firms for the purchase of property developers bonds whilst also making CNY 1000bln available for M&A financing. Stateside, US futures are a touch firmer (ES +0.2%, NQ +0.2% and RTY +0.3%), albeit given the market closure yesterday and curtailed session today it is not worth inferring too much from today’s price action. Analysts at Barclays have cautioned against extrapolating the recent rally in equities into 2023 with the desk of the view that the upside has been driven by short covering from CTAs and macro hedge funds. Sectors in Europe are mixed with continued upside in Energy names whilst Real Estate lags with UK homebuilders weighed on by a negative note from Berenberg with the brokerage of the view that the trough in the sector’s earnings will last until 2024. Notable stock-specific newsflow is exceptionally light for the session with BT (+0.7%) garnering minor support from JP Morgan maintaining the Co. with an overweight rating whilst SSE (+0.7%) agreed the sale of a 25% stake in its transmissions business for GBP 1.465bln

25 Nov 2022 - 09:25- EquitiesResearch Sheet- Source: Newsquawk