Apart from Switzerland most European indices finished at or near lows on the day. Losses were broad with Tech, Retail, and Autos seeing losses of over a percent. President Trump’s threat of tariffs on several European export categories weighed with traders a bit touchy anyway considering the months long rebound. Overhead resistance levels are slowing the advance higher with the Stoxx 600 up ~18% since its December low. Volumes today too were lackluster, off 16% from recent turnover.
In addition to the $11B in tariffs that may hit European tariffs other headlines include PM May’s meeting today with Merkel and France’s Macron. The World Bank and IMF kick off a spring get-together, no doubt to decry protectionism. Italy pared their FY19 GDP growth view from 1% down to .1% while upping their budget deficit estimate. Tomorrow, the ECB meets with the post-announcement presser sure to be watched and scrutinized closely.
Earlier we mentioned the interest of Wynn Resorts into Crown Resorts. Evidently the fact that the preliminary discussions were leaked though caused Wynn to discontinue the conversation.
SAP -3.4% led the tech space lower on a downgrade by UBS and HSBC with further margin expansion questioned. The strong move in the name was also mentioned.
The luxury space was off today after Credit Suisse downgraded Richemont -2.7%, noting the firm needs substantial investment to keep margins strong. Cartier is 54% of group profit leading CS to note the firm really needs a major launch soon. They highlighted lowered sales on a diminishing positive wealth effect adding watch sales aren’t getting any better. Louis Vuitton -1.4%, Kering -1.7%.
From earlier: Airbus -1.9%, Novartis -2%, Debenhams -flat, Sports Direct +1%.
Producer Prices, Core Machine Orders, and Bank Lending levels are expected from Japan tonight. Korean employment is due tonight along with Westpac consumer readings Down Under. Along with the ECB noted above the UK will release its Trade balance along with Industrial and Manufacturing Production plus GDP.