Cac 40 negative.

European Equities: A Busy Economic Calendar to Drive the Majors

Economic Calendar

Tuesday, 1st June

Spanish Manufacturing PMI (May)

Italian Manufacturing PMI (May)

French Manufacturing PMI (May) Final

German Manufacturing PMI (May) Final

Eurozone Manufacturing PMI (May) Final

Eurozone Unemployment Rate (Apr)

German Unemployment Change (May)

German Unemployment Rate (May)

Eurozone CPI (YoY) (May) Prelim

ECB President Lagarde Speaks

Wednesday, 2nd June

German Retail Sales (MoM) (Apr)

Thursday, 3rd June

Spanish Services PMI (May)

Italian Services PMI (May)

French Services PMI (May) Final

German Services PMI (May) Final

Eurozone Markit Composite PMI (May) Final

Eurozone Services PMI (May) Final

Friday, 4th June

German IHS Markit Construction PMI (May)

Eurozone Retail Sales (MoM) (Apr)

ECB President Lagarde Speaks

The Majors

It was relatively bearish start to the week for the European majors on Monday.

The CAC40 and the EuroStoxx600 fell by 0.57% and by 0.49% respectively, with DAX30 declining by 0.64%.

With the UK and the U.S markets closed, there was little for the markets to consider other than prelim inflation figures.

A continued pickup in inflationary pressures pegged the majors back. The downside was limited, however, following assurances from the ECB that there would be no tapering to the asset purchasing program.

For the ECB, however, the bigger question will be at what point will a tapering be needed should inflationary pressures fail to abate.

The Stats

Economic data from the Eurozone was on the busier side this morning with prelim inflation figures for Germany and Italy were in focus.

In May, German consumer prices increased by 0.5%, following a 0.7% rise in April. Economists had forecast a 0.5% rise.

According to Destatis,

  • Year-on-year, the annual rate of inflation accelerated from 2.0% to 2.5%.
  • Prices for goods rose by 3.1%, driven by a 10.0% jump in energy prices.
  • Food prices increased by a modest 1.5%, while prices for services increased by 2.2%.

From Italy, consumer prices held steady in May, following on from a 0.4% increase in April. Economists had forecast a 0.4% rise.

According to istat.it,

  • While stalling in the month of May, the annual rate of inflation ticked up from 1.1% to 1.3%.
  • Prices of energy products jumped by 13.8%, supporting the pickup in the annual rate of inflation.

Inflation figures from Spain were also out but had a muted impact on the majors. Spain’s annual rate of inflation accelerated from 2.2% to 2.7% in May, according to prelim figures.

From the U.S

There were no major stats to consider, with the U.S markets closed at the start of the week.

The Market Movers

For the DAX: It was a mixed day for the auto sector on Monday. Continental fell by 1.12% to lead the way down, with BMW and Daimler ending the day down by 0.43% and by 0.72% respectively. Volkswagen bucked the trend, however, gaining 0.93%.

It was a bearish day for the banks. Deutsche Bank slid by 2.12%, with Commerzbank falling by 0.32%. Reports that the U.S Federal Reserve had pointed out a continued failure to address AML control issues left Deutsche Bank in the deep red.

From the CAC, it was a bearish day for the banks. Credit Agricole and Soc Gen fell by 0.81% and by 0.17% respectively, with BNP Paribas declining by 1.12%.

It was a mixed day for the French auto sector, however. Stellantis NV rose by 0.94%, while Renault ended the day down by 0.85%.

Air France-KLM and Airbus SE saw losses of 0.17% and 1.24% respectively.

On the VIX Index

There was no trading, with the U.S markets closed for Memorial Day.

The Day Ahead

It’s a particularly busy day ahead on the European economic data front. Manufacturing sector PMI numbers from Spain and Italy are due out along with unemployment numbers from Germany and the Eurozone.

Finalized manufacturing PMIs are also due out for France, Germany, and the Eurozone.

Barring any marked revision from prelim PMIs, expect Italy and the Eurozone’s manufacturing PMIs and Germany’s unemployment figures to be key.

Prelim inflation figures and unemployment numbers for the Eurozone will also draw attention.

From the U.S, the market’s preferred ISM Manufacturing PMI will also provide direction late in the day.

Ahead of the European open, China’s Caixin Manufacturing PMI will set the tone.

Away from the economic data, expect FOMC member chatter and updates from Capitol Hill to also influence later in the day.

The Futures

In the futures markets, at the time of writing, the Dow Mini was down by 28 points.

For a look at all of today’s economic events, check out our economic calendar.