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International Summary

"CAPIS EU Close Recap – 1/10/2019"

posted by Clayton Duff on 01/10/2019 at 1:24 pm

by Clayton Duff

01/10/2019 at 1:24 pm

After a weaker open European indices spent much of the session a tight range just above lows.  However, post the US open and it shaking off earlier lows Europe worked its way back to slight gains on the day.  Retailers finished down small with Utilities up over a percent.  Insurers, Banks, and Financials led even as yields fell on the day.   Volume on the Stoxx 600 was lower by 17%.

Overnight inflation readings in China missed estimates with indices there closing down small as MOFCOM statements note talks continue between them and the US.  The large miss on the producer inflation side gave hopes to those looking for future rate cuts.  On the weakening economy auto sales were reported to be down for the 1st time in 20 years Tuesday leading to the government to announce moves to boost purchases in the space.  On that related names have mostly rallied the last couple of days.   Fast Retailing fell ahead of post-the-close results that showed global brands operating profit down 10% YoY for the quarter. Uniqlo sales in December though rose 5.2% YoY.  Names in the consumer cosmetics and toiletry space fell on new Chinese rules that will curtail sales there. Kao -5.5% and Shiseido -4.1%.  Japan fell as a whole with the Yen strengthening overnight.

Industrial and Manufacturing production readings in France fell in November, missing views and accelerating recent weakness. The CAC40 fell on the day.  Keep an eye out tomorrow for UK production readings along with their GDP reading for November.

On the earnings front Halfords fell 22% after noting mild weather and weak consumer confidence led to a profit warning for the year. They see earnings down 16.5% this year, flat next year before rebounding in 2021. Debenhams -15% also produced a sizable loss with 18 week group gross transactions down 5.6%.  Shareholders voted to not reelect the Chairman with him stepping down from the board immediately.  CEO Bucher will continue on as CEO but will leave the board with shareholders too voting him out.

About the Author

ClaytonDuffFVP,Senior International Trader

Clayton Duff joined the firm in 2008. He has worked in the industry since 1994 and held various trading and sales positions before CAPIS, including four years as a trader for First Southwest. He earned his bachelor’s degree from the University of Texas Arlington. Clayton maintains Series 3,...

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