List of stock market indices

European Equities: Trade, Corporate Earnings and Stats in Focus

Economic Calendar:

Tuesday, 30th July

  • French GDP (QoQ) (Q2)
  • GfK German Consumer Climate (Aug)
  • French Consumer Spending (MoM) (Jun)
  • German CPI (MoM) (Jul) Prelim

Wednesday, 31st July

  • German Retail Sales MoM (Jun)
  • French CPI m/m (Jul) Prelim
  • French HICP m/m (Jul) Prelim
  • Spanish GDP (QoQ) (Q2)
  • German Unemployment Change (Jul)
  • German Unemployment Rate (Jul)
  • Eurozone Core CPI (YoY) (Jul) Prelim
  • Eurozone CPI (YoY) (Jul) Prelim
  • Italian CPI (MoM) (Jul) Prelim
  • Eurozone GDP (Q2)
  • Eurozone Unemployment Rate (Jun)

Thursday,1st August

  • Spanish Manufacturing PMI (Jul)
  • Italian Manufacturing PMI (Jul)
  • French Manufacturing PMI (Jul) Final
  • German Manufacturing PMI (Jul) Final
  • Eurozone Manufacturing PMI (Jul) Final

Friday, 2nd August

  • Eurozone Retail Sales (MoM) (Jun)

The Majors

The majors started the week mixed on Monday. The CAC40 and DAX30 fell by 0.16% and by 0.02% respectively, while the EuroStoxx600 rose by 0.03%.

Sentiment towards the U.S – China trade talks that resume today provided support for the majors on the day. With economic data on the lighter side, the outlook towards the FED’s interest rate decision also was a factor ahead of Wednesday’s FOMC.

The Stats

It was a relatively quiet day on the economic calendar, with stats out of the Eurozone limited to Spain’s prelim July inflation figures.

According to Ine, the annual rate of inflation stood at 0.5% in July, falling short of a forecasted 0.6%. The annual rate of inflation had stood at 0.4% in June. The baseline annual rate of inflation stood at 0.7%, up from 0.6% in June. Economists had forecast 0.8%.

Whilst inflationary pressure picked up in July, according to the prelim figures, there’s unlikely to be any shift in the ECB’s stance on monetary policy.

The Market Movers

From the DAX, the auto sector struggled at the start of the week. Volkswagen led the way down on the day, sliding by 1.67%. BMW (-0.76%), Continental (-0.36%), and Daimler (-0.17%) also saw red.

The banking sector also hit reverse on the day, with Deutsche Bank and Commerzbank falling by 0.98% and by 0.56% respectively.

From the CAC, it was also a day in the red for bank stocks. BNP Paribas and Credit Agricole fell by 0.65% and by 0.41% respectively. Soc Gen also declined, falling by 0.76%. Renault joined its German peers, falling by 1.01% on Monday.

The Day Ahead

It’s a busier day ahead on the economic data front.

French 2nd quarter GDP and Germany’s August GfK Consumer Climate figures are due out ahead of the European open.

Later in the morning, French consumer spending figures will also influence the majors. In the afternoon, prelim inflation numbers out of Germany will likely have a muted impact on the majors. We would also expect finalized Eurozone consumer confidence figures to be brushed aside, barring a revision from prelims.

With the ECB tracking consumer spending and labor market conditions, consumer sentiment and spending are key. On the Frech GDP front, anything in line with or better than forecast would also support the majors early on in the day. The French economy is forecasted to grow by 1.3% year-on-year in the 2nd quarter, up from 1.2% in the 1st quarter.

From outside of the Eurozone, economic data out of the U.S will also influence on the day. The FED’s preferred inflation numbers, personal spending, and consumer confidence could have an impact on the FOMC’s forward guidance tomorrow.

Outside of the stats, it’s also a busy day on the corporate earnings front. Facebook, Apple, and General Electric are among key earnings releases late in the day.

At the time of writing, the DAX Futures was up by 8 points, while the Dow Mini was up by 35 points.