Article / 05 February 2015 at 7:29 GMT

Market Open: ECB steps up pressure on Greece

TradingFloor.com Team / Saxo Bank
Denmark
  • FTSE 100 likely to open 40 to 48 points in the red
  • Asian markets trading mostly firmer 
  • DAX and CAC expected to open lower


Forex Overnight: EUR trading lower
Currencies Intraday

 








Source: Bloomberg

The EUR is trading weaker against its major counterparts this morning, extending yesterday’s losses which were triggered after the European Central Bank toughened its stance on Greece, stating that it would no longer accept Greek government bonds as collateral for lending money to commercial banks. 


Later today, traders will keep a tab on German factory orders as well as on the ECB’s economic bulletin for further direction. The Bank of England’s interest rate decision will also be keenly eyed. In the US, investors will focus on trade balance figures which are expected to show that the nation’s trade deficit narrowed in December. 


Additionally, weekly jobless claims and other labour market data in the US will attract market attention. At 06:00 GMT, the EUR has dropped marginally against the USD to trade at $1.1343, while it has fallen 0.2% against the GBP to trade at GBP 0.7458.

The JPY has advanced 0.1% against the USD and the EUR, each.


UK Stocks: Expected to open in negative territory
FTSE 100

 








Source: Bloomberg

The FTSE 100 is likely to open 40 to 48 points in the red.

New Car Registrations and Halifax House Price Index are the key economic indicators scheduled for release today. Additionally, traders will keep a tab on the BoE’s interest rate and asset-purchase facility decision.

AstraZeneca (AZN), Smith & Nephew (SN/) and Avanti Communications Group (AVN) are scheduled to report their results.

Petroleo Brasileiro SA indicated that the company along with its partner, BP (BP/), have discovered new oil accumulations in the Campos Basin off the coast of Rio de Janeiro.

Reuters reported that Imperial Tobacco Group (IMT) would launch the new e-cigarette brand, Jai, in France next week in order to widen its e-cigarette strategy.

Standard & Poor's downgraded Afren Plc’s (AFR) long-term corporate credit rating to “SD” from “CC” as the oil producer was unable to fulfil its obligations under both its $300 million revolving credit facility and its bonds maturing in 2016 on time.


Asia: Trading mostly higher
Nikkei 225

 








Source: Bloomberg


Asian markets are trading mostly firmer this morning.

In Japan, Toyota Motor (7203) lost value despite reporting a rise in its third-quarter operating profit and raising its full-year earnings forecast. A decline in its third-quarter earnings led Mazda Motor (7261) to drop. Inpex (1605) and Showa Shell Sekiyu (5002) also plummeted, tracking a fall in crude oil prices. 


However, Sony (6758) rallied as the company’s third-quarter net profit more than tripled and after it hiked its full-year earnings outlook. At 06:00 GMT, the Nikkei 225 index fell 0.7% to trade at 17,549.6.

In South Korea, Shinhan Financial (055550) tumbled after reporting a decline in its fourth-quarter net profit. In China, markets traded in positive territory after the People's Bank of China lowered the reserve requirement ratio for the nation's banks by 50 basis points for the first time in more than two years. China Merchants Bank (600036), Bank of China (601988) and Bank of Communications (601328) rallied. In Hong Kong, CITIC Securities (6030) and China Everbright (165) advanced. China Minsheng Banking (1988) and Industrial & Commercial Bank of China (1398) also paced gains.


US Stocks: Futures trading lower
S&P 500

 








Source: Bloomberg

At 06:00 GMT, S&P 500 futures were trading 3.1 points weaker.

Key economic indicators scheduled for release today include Initial and Continuing Jobless Claims, Trade Balance, Unit Labour Costs, Non-Farm Productivity and Challenger Job Cuts.

Philip Morris International (PM), McKesson (MCK), CME Group (CME), LinkedIn (LNKD) and Cigna (CI) are scheduled to report their results.

In the after-hours trading session yesterday, Keurig Green Mountain (GMCR) tumbled 7.5%, hurt by weaker-than-expected first-quarter results. 21st Century Fox (FOXA) declined 5.5% after the company lowered its profit forecasts for 2015 and 2016. Prudential Financial (PRU) shed 3.1% as the company swung to a fourth-quarter loss. On the flipside, Yum! Brands (YUM) edged up 1% following better-than-expected fourth-quarter revenue.

Yesterday, the S&P 500 Index fell 0.4% in the regular trading session amid weakness in energy sector stocks and after the ECB tightened its rules on Greece’s bailout. ENSCO (ESV), Denbury Resources (DNR) and Noble Corporation (NE) tumbled 5.2%, 5% and 4.7%, respectively, as oil prices snapped a four-day rally. 


Merck & Company (MRK) declined 3.2%, hurt by disappointing fourth-quarter revenue and a tepid earnings guidance for 2015. Ralph Lauren (RL) plunged 18.2% after the retailer reported third-quarter earnings below analysts' estimates and cut its revenue forecast for 2015. 


Gilead Sciences (GILD) sank 8.2% as the biotechnology firm warned that discounts for its hepatitis C drugs could weigh on revenue for 2015. Chipotle Mexican Grill (CMG) plummeted 7% after the restaurant operator posted weaker-than-expected fourth-quarter same-store sales. Fastenal (FAST) slid 7.8% after its fourth-quarter revenue missed analysts’ expectations. 


On the other hand, Walt Disney (DIS) surged 7.6% as its first-quarter results surpassed analysts’ estimates. Better-than-expected fourth-quarter results and an upbeat profit outlook for 2015 led Whirlpool (WHR) to gain 6.9%. Microsoft (MSFT) edged up 0.6% following reports that the company acquired the calendar application developer, Sunrise, for around $100 mn. 


General Motors (GM) climbed 5.4% as the company reported fourth-quarter earnings above market expectations and announced that it plans to raise its quarterly dividend.


Europe Stocks: Likely to open in the red
EU Stoxx 50

 








Source: Bloomberg

The DAX and the CAC are expected to open 99 to 111 points and 55 to 59 points lower, respectively.

German Factory Orders and Swiss State Secretariat for Economic Affairs Consumer Climate are the key economic indicators scheduled for release today. Additionally, traders await the Economic Bulletin to be published by the ECB.

Daimler AG (DAI), Sanofi SA (SAN), BNP Paribas SA (BNP), Muenchener Rueckversicherungs-Gesellschaft AG (MUV2), Enel SpA (ENEL) and Dassault Systemes SA (DSY) are scheduled to report their results.

According to media reports, BT Group has reached an agreement with Deutsche Telekom AG (DTE) and Orange SA (ORA) for the acquisition of their UK mobile-phone joint venture, EE Limited, for around GBP 12.5 billion.

The Wall Street Journal reported that US federal prosecutors have launched a new investigation into whether UBS AG (UBSN) aided wealthy Americans in evading taxes through so-called bearer securities which are largely banned in the US.


Macro update

Fed’s Mester advocates rate hike in first half of 2015

Loretta Mester, the president of the Federal Reserve Bank of Cleveland, stated that the US Federal Reserve should raise interest rates in the first half of this year considering the increase in economic momentum and significant improvement in labour markets.

Australia’s new home sales drop, indicates HIA

The Housing Industry Association has reported that, on a monthly basis, new home sales in Australia have fallen 1.9% in December compared with a rise of 2.2% posted in the previous month.

Australia’s retail sales rise less than expected

On a seasonally adjusted monthly basis, retail sales in Australia have advanced 0.2% in December, less than market expectations and compared with a rise of 0.1% recorded in the preceding month.


Economic calendar




Country

GMT

Economic Indicator

Relevance

Consensus

Previous

Frequency

Japan

1:30

BoJ Iwata Gives Speech and Hold a Press Conference

Low

-

-

-

Switzerland

6:45

SECO Consumer Climate (Q4)

Medium

-13.00

-11.00

Quarterly

Germany

7:00

Factory Orders n.s.a. (YoY) (Dec)

Medium

0.70%

-0.40%

Monthly

Germany

7:00

Factory Orders s.a. (MoM) (Dec)

Medium

1.50%

-2.40%

Monthly

UK

8:00

Halifax House Prices (3M/YoY) (Jan)

Low

7.80%

7.80%

Monthly

UK

8:00

Halifax House Prices (MoM) (Jan)

Low

0.10%

0.90%

Monthly

Eurozone

9:00

ECB Publishes Economic Bulletin

Medium

-

-

-

UK

9:00

New Car Registrations (YoY) (Jan)

Low

-

8.70%

Monthly

Eurozone

9:45

ECB's Weidmann Speaks in Venice, Italy

Low

-

-

-

US

10:00

Fed's Rosengren Addresses Conference on Sovereign Risk

Low

-

-

-

Eurozone

10:00

EU Publishes Economic Forecasts

Low

-

-

-

Eurozone

11:30

ECB's Praet speaks in Frankfurt

Low

-

-

-

UK

12:00

BoE Interest Rate Decision

High

0.50%

0.50%

-

UK

12:00

BoE Asset Purchase Facility

High

GBP375.00 bn

GBP375.00 bn

-

US

12:30

Challenger Job Cuts (YoY) (Jan)

Low

-

6.60%

Monthly

Eurozone

13:30

ECB Governing Council Knot in Dutch Parliament on QE

Low

-

-

-

Canada

13:30

International Merchandise Trade (Dec)

Low

-CAD1.10 bn

-CAD0.64 bn

Monthly

US

13:30

Non-Farm Productivity (Q4) (P)

Low

0.20%

2.30%

Quarterly

US

13:30

Unit Labour Costs (Q4) (P)

Low

1.20%

-1.00%

Quarterly

US

13:30

Continuing Jobless Claims (24-Jan)

Low

2400.00 K

2385.00 K

Weekly

US

13:30

Initial Jobless Claims (31-Jan)

Medium

290.00 K

265.00 K

Weekly

US

13:30

Trade Balance (Dec)

Medium

 -$38.00 bn

 -$39.00 bn

Monthly

Japan

23:50

Japan Foreign Reserves (Jan)

Low

-

$1260.50 bn

Monthly






See today's events updated in real-time in our Financial Calendar on TradingFloor.com






Corporate Calendar


Country

Company Name

Index

Announcement

UK

AstraZeneca Plc

FTSE All Share

Final

UK

Compass Group Plc

FTSE All Share

Trading

UK

Dairy Crest Group Plc

FTSE All Share

Trading

UK

Darty Plc

FTSE All Share

Trading

UK

easyJet Plc

FTSE All Share

Trading

UK

Enterprise Inns Plc

FTSE All Share

Trading

UK

Grainger Plc

FTSE All Share

Trading

UK

McBride Plc

FTSE All Share

Interim

UK

Smith & Nephew Plc

FTSE All Share

Q4 Earnings Release

UK

Vodafone Group Plc

FTSE All Share

Trading

UK

Wincanton Plc

FTSE All Share

Trading

Germany

Daimler AG

DAX 30, EuroStoxx 50

Q4 Earnings Release

Germany

Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen

DAX 30, EuroStoxx 50

Prelim

France

BNP Paribas SA

CAC 40, EuroStoxx 50

Q4 Earnings Release

Italy

Enel SpA

EuroStoxx 50

Prelim

US

Alliance Data Systems Corp.

S&P 500

Q4 Earnings Release

US

Apartment Investment and Management Co.

S&P 500

Q4 Earnings Release

US

Ball Corp.

S&P 500

Q4 Earnings Release

US

Becton Dickinson and Co.

S&P 500

Q1 Earnings Release

US

CareFusion Corp.

S&P 500

Q2 Earnings Release

US

Cigna Corp.

S&P 500

Q4 Earnings Release

US

CME Group Inc.

S&P 500

Q4 Earnings Release

US

Cummins Inc.

S&P 500

Q4 Earnings Release

US

Delphi Automotive Plc

S&P 500

Q4 Earnings Release

US

Entergy Corp.

S&P 500

Q4 Earnings Release

US

EQT Corp.

S&P 500

Q4 Earnings Release

US

Estee Lauder Companies Inc.

S&P 500

Q2 Earnings Release

US

Expedia Inc.

S&P 500

Q4 Earnings Release

US

Fidelity National Information Services Inc.

S&P 500

Q4 Earnings Release

US

Intercontinental Exchange Inc.

S&P 500

Q4 Earnings Release

US

Kimco Realty Corp.

S&P 500

Q4 Earnings Release

US

McKesson Corp.

S&P 500

Q3 Earnings Release

US

Michael Kors Holdings Ltd.

S&P 500

Q3 Earnings Release

US

News Corp.

S&P 500

Q2 Earnings Release

US

Perrigo Company Plc

S&P 500

Q2 Earnings Release

US

Philip Morris International Inc.

S&P 500

Q4 Earnings Release

US

PPL Corp.

S&P 500

Q4 Earnings Release

US

Snap-On Inc.

S&P 500

Q4 Earnings Release

US

Stericycle Inc.

S&P 500

Q4 Earnings Release

US

Symantec Corp.

S&P 500

Q3 Earnings Release

US

TECO Energy Inc.

S&P 500

Q4 Earnings Release

US

Teradata Corp.

S&P 500

Q4 Earnings Release

US

Verisign Inc.

S&P 500

Q4 Earnings Release

US

Vulcan Materials Co.

S&P 500

Q4 Earnings Release

US

Xylem Inc.

S&P 500

Q4 Earnings Release





Ex-Dividend Calendar


Country

Company Name

Index

Announcement

UK

Unilever Plc

FTSE100

Quarterly Ex-Dividend


– Edited by Oliver Morrison

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