Economic Data
(CH) Swiss Oct SECO Consumer Confidence: -17 v -21e
(UK) Oct Halifax House Prices M/M: -0.7% v +0.4%e; 3M/Y: -1.7% v -1.3%e
(CZ) Czech Sept Industrial Output Y/Y: -7.1% v -4.5%e; Construction Output Y/Y: -10.6 v -4.7% prior
(CZ) Czech Sept Trade Balance (CZK): 31.6B v 30.3Be
(EU) ECB: €503M borrowed in overnight loan facility €514M prior; €261.41 parked in deposit facility vs. €261.4B prior
(ES) Spain Oct Services PMI: 41.2 v 40.2e (16th straight month of contraction)
(SE) Sweden Sept Service Production M/M: -0.7% v 0.3%e; Y/Y: -0.2% v 1.1%e
(IT) Italy Oct PMI Services: 46.0 v 44.5e
(FR) France Oct Final PMI Services: 44.6 v 46.2e
(DE) Germany Oct Final PMI Services: 48.4 v 49.3e
(EU) Eurozone Oct Final PMI Services: 46.0 v 46.2e ; PMI Composite: 45.7 v 45.8e (both readings are lowest since July 2009)
(UK) Oct New Car Registrations Y/Y: 12.1% v 8.2% prior
(UK) Sept Industrial Production M/M:-1.7 % v -0.6%e; Y/Y: -2.6% v -1.6%e
(UK) Sept Manufacturing Production M/M: 0.1% v 0.4%e; Y/Y: -1.0% v -0.8%e
(EU) Eurozone Sept PPI M/M: 0.2% v 0.2%e; Y/Y: 2.7% v 2.6%e
Fixed income:
(ZA) South Africa sold total ZAR2.1B vs. ZAR2.1B indicated in 2031, 2036 and 2048 Bonds
(GR) Greece Debt Agency (PDMA) sold €1.3B vs. €1.0B indicated in 26-week Bills; Avg Yield 4.41% v 4.46% prior; Bid-to-cover: 1.7x v 1.6x prior
(AT) Austria Debt Agency (AFFA) sold €1.32B vs. €1.32B indicated in 2019 and 2022 RAGB Bonds
Sold €600M in 1.95% Jun 2019 RAGB; Avg Yield 1.218% v 1.326% prior; Bid-to-cover: 2.21x v 4.1x prior (Oct 2nd
Sold €600M in3.40% Nov 2022 RAGB; Avg Yield 1.888% v 2.360% prior; Bid-to-cover: 2.86x v 2.50x prior
(EU) ECB allotted €79.5B vs. 80Be in 7-Day Main Refinancing Tender at fixed 0.75%
(CH) Switzerland sold CHF803M in 3-Month Bills; Avg Yield -0.170% v -0.229% prior
(HU) Hungary Debt Agency (AKK) sold HUF50B vs. HUF50B indicated in 3-Month Bills; Avg Yield 6.06% v 6.12% prior; Bid-to-cover: 1.70x v 1.50x prior
(UK) DMO sold £3.25B in 1.75% 2022 Gilts; Avg Yield 1.815% v 1.765% prior; Bid-to-cover:1.93 x v 1.87x prior; Tails 0.3bps v 0.1bps prior
(BE) Belgium Debt Agency sold total €2.51B vs. €2.7B indicated in 3-month and 6-month Bills
Sold €1.205B in 3-month Bills; Avg Yield +0.004% v -0.010% prior; Bid-to-cover: 3.39x v 3.12x prior
Sold €1.308B in 6-month Bills; Avg yield +0.021% v +0.017% prior; Bid-to-cover: 2.66x v 2.07x prior
Notes/Observations
RBA surprises market by leaving its Cast Target Rate unchanged at 3.25% citing price pressures and stabilized growth
Greece begins 48 hour strike against austerity. Massive general strike planned for Spain and Portugal Nov 14.
European Commission to forecast a bleak outlook for Spain in its autumn update this week
European PMI Services data mixed with better peripheral readings and weaker core countries
Equities
Indices: FTSE 100 +0.50% at 5,866, DAX +0.50% at 7,363, CAC-40 +0.60% at 3,468, IBEX-35 +0.30% at 7,843, FTSE MIB +0.50% at 15,625, SMI +0.20% at 6,721, S&P 500 Futures +0.25% at 1,415
European equity markets opened the session mixed, but have since moved higher, as services PMI data out of Italy and Spain exceeded market expectations. However, PMI data from Germany and France missed consensus views, amid some concerns that the impact of the debt crisis has spread to the core euro zone countries. Most European banks are trading higher, led by Commerzbank and Lloyds. Resources related firms are broadly higher, tracking the gains in commodity prices.
In the UK, retailer, Marks & Spencer [MKS.UK] has traded higher as the firm reported better than expected H1 profits. Metric Property Investments [METP.UK] is higher by over 10% on its plan to explore a merger with London & Stamford [LSP.UK]. Energy company Bowleven [BLVN.UK]has gained over 15%, as the company disclosed a strategic agreement with Petrofac [PFC.UK]. Shares of Babcock International [BAB.UK] have lost over 2.5%, following the release of the firm's H1 earnings report. Construction company Morgan Sindall [MGNS.UK] has moved lower by over 6%, after disclosing a profit warning. Swiss staffing firm Adecco [ADEN.CH] has gained over 2% on better than expected Q3 results.
In Germany, BMW [BMW.DE] has moved between gains and losses after reporting better than expected Q3 results. In Q3, the German automaker reported an EBIT margin for its auto unit of 9.6% vs 10.9% for the 9-month period. In the chemicals space, shares of Lanxess [LXS.DE] have lost over 1%, as the firm made cautious comments about its FY EBITDA outlook. Volkswagen [VOW3.DE] is down over 1.5%, after disclosing a plan to sell convertible debt. Shares of Fraport [FRA.DE] have gained over 1.5% on better than expected quarterly results. Also, HannoverRe [HNR1.DE] is higher by more than 3.5%, after reporting Q3 profits above consensus forecasts. Dutch bank SNS Reaal [SR.NL] has traded lower by over 6%, after releasing its Q3 results.
FTSE 100 movers (ARM Holdings +5%, Resolution +4.7%, G4S +2.8%, Kingfisher +2%, Lloyds +1.8%; Babcock International -3.5%, Admiral Group -2%)
CAC-40 movers (STMicroelectronics +2.2%, Schneider Electric +1.9%, Veolia Environmental +1.8%, Credit Agricole +1.7%, Accor +1.5%)
DAX movers (ThyssenKrupp +2.3%, Commerzbank +1.9%, Infineon +1.8%, Lufthansa +1.6%, SAP +1.3%; Volkswagen -2.5%)
IBEX-35 movers (Sacyr +1.8%, Ferrovial +1.5%, Tecnicas +1.1%; Abengoa -1.2%)
FTSE MIB movers (Fiat +2.9%, Lottomatica +1.4%, Banca Monte dei Paschi +1.5%, Mediaset +1.3%, Impreglio +1.2%; Tenaris -2.3%)
SMI movers (Adecco +3%, ABB +1.7%, UBS +1.7%, Credit Suisse +1.3%, Swiss Re +1.1%)