banner

Ticker

* Cotações com atraso superior a 15 minutos via Bats CHI-X Europe e NASDAQ Basic

Patris Daily - 16 August 2018

16 Aug 2018

noticias/Diario-Fincor.jpg

GLOBAL MARKETS OVERVIEW:

Europe: negative session for the major European stock indices. Stoxx600 closed 1.36% down, with all its sectors suffering losses. Basic Resources (-4.15%) was hit the hardest, on the back of a meltdown in metal prices.

Eurozone sovereign debt market: Italian (+14bps to 3.169%), Spanish (+3bps to 1.44%) and Portuguese (+3bps to 1.836%) 10-year bond yield increased on the session, while German bund decreased 2bps to 0.303%. 

Portugal: PSI20 lost 1.59% on Wednesday, in a fourth consecutive negative session. Corticeira Amorim (+0.8%) and Ibersol (+0.2%) were the only titles that closed positive. Navigator (-4.4%) continued as the biggest loser, followed by Altri (-3.6%) and Galp (-2.5%).

FX & Commodities: oil prices traded lower, with the first future of Brent down by 2.35% (+0.44% as we type). Gold dropped 1.61% during the session (-0.03% as we type). EUR/USD finished the day almost unchanged (+0.20% as we type).

US Equity & Debt Markets: S&P500 finished 0.76% lower. Real Estate (+0.84%), Utilities (+0.76%), Telecommunications (+0.70%) and Consumer Staples (+0.44%) were the only sectors that closed positive. Energy (-3.51%) was hit the hardest, on the back of crude price losses.

Latin America: in Colombia, industrial production rose 1.3% y/y in June (below consensus of 2.0% y/y), after a rise of 2.9% y/y in May. Retail sales surprised to the upside, accelerating from 5.9% y/y in May to 6.3% y/y in June, above market expectations of 4.7% y/y. Trade deficit stood at $719.2mn, vs. consensus of -$800mn. Imports rose 11.9% y/y in June to $4.2bn, exports increased 15.9% y/y to $3.3bn.

Asia: stocks traded with a negative tone overnight: TOPIX -0.64%, HANG SENG -0.87% as we type, SHANGHAI COMPOSITE -0.66%, HSCEI -0.74% as we type, TAIEX -0.31%, KOSPI -0.80% and S&P/ASW 200 -0.01%

The Chinese Commerce Ministry announced that a senior Chinese delegation will visit the United States for trade talks later this month to discuss economic and trade issues between China and the US.

Turkish officials said yesterday that Qatar had pledged $15 billion of direct investments for Turkey, in a bid to help Turkish economy.

Turkey said it will increase tariffs on US products like cars, alcohol, and coal, in a response to the US President Donald Trump's recent decision to double tariffs on Turkish steel and aluminum. The government said tariffs on American cars will be doubled to 120% while those on alcoholic drinks will be hiked to 140%. Overall, the duties will amount to $533 million. The tariffs come one day after President Erdogan said Turkey would boycott US electronics, singling out iPhones.

OUR TAKE ON THE LATEST MACRO DATA:

United Kingdom: Labour Market Report June/ July

Employment change in a 3-month period until June stood at 42k, below the last month´s print of 137k and below the survey expectations of 93k. The unemployment rate diminished to 4.0% in the 3-month period until June (below consensus of 4.2%), the minimum for current expansion. Average weekly earnings eased 0.1 pp and rose 2.4% y/y in a 3-month period until June, below expectations of 2.5% y/y. Weekly earnings excluding bonuses increased 2.7% in the same period, in line with expectations and below the previous month print of 2.8% y/y.

Eurozone: 2Q18 GDP Growth

Seasonally adjusted GDP rose by 0.4% q/q in the euro area in the 2Q18 (vs, consensus of 0.3% q/q), an upward revision from the flash reading of 0.3% q/q. Compared with the same quarter of 2017, GDP rose by 2.2% in the 2Q18 (vs. consensus of 2.1% y/y), after 2.5% y/y in the previous quarter.

Germany: the GDP growth accelerated from 0.4% q/q in the 1Q18 to 0.5% q/q in the 2Q18, above the consensus of 0.4% q/q. Compared with a year earlier, the price-adjusted GDP rose 2.3% in the 2Q18, after a rise of 1.4% y/y in the 1Q18.

Portugal: the real GDP growth accelerated from 0.4% q/q in the 1Q18 to 0.5% q/q in the 2Q18, above the consensus of 0.3% q/q. Compared with the same period of 2017, GDP increased by 2.3% in volume in the 2Q18, after a rise of 2.1% y/y in the 1Q18.

France: 2Q18 Unemployment Rate

France ILO unemployment rate stood at 9.1% in the 2Q18, vs. 9.2% in the 1Q18 and 9.4% in the 2Q17. The youth (15-24 years old) unemployment rate decreased from 21.4% in the 1Q18 to 20.8% in the 2Q18. Both men and women unemployment rate registered declines to 9.0% and 9.1% respectively.

Eurozone: June Industrial Production

Euro area industrial production contracted by 0.7% m/m in June, below consensus expectations (-0.4% m/m). May data was revised upwards, from 1.3% m/m to 1.4% m/m. The annual growth rate decreased from 2.6% y/y in May (revised upwards from 2.4% y/y), to 2.5% y/y in June, above the market expectations of 2.4% y/y.

The monthly decrease in industrial production was due to production of capital goods falling by 2.9% m/m, non-durable consumer goods by 0.6% m/m, intermediate goods by 0.5% m/m and durable consumer goods by 0.4% m/m. The energy production rose by 0.5% m/m in June.

The decline in June was driven mainly Ireland, Germany, Spain and the Netherlands. IP output rose 0.5% m/m in Italy and by 0.6% m/m in France.

Portugal: 2Q18 Labour Cost Index

The Labour Cost Index, working days adjusted, increased by 1.4% y/y in the 2Q18, after a decrease of 1.3% y/y registered in the 1Q18. The wage costs (per hour actually worked) increased by 1.2% y/y, while the number of hours worked per employee declined by 1.1% y/y.

Total labour costs increased in the private sector by 3.2% y/y (industry +5.6% y/y, construction +3.3% y/y, services +1.7% y/y), while they decreased in the public sector by 0.7% y/y.

Germany: August ZEW survey

The ZEW assessment of the current situation rose slightly to 72.6 in August (vs. consensus of 72.1), compared to 72.4 in July. The expectations of the future economic situation increased by 11 points to -13.7, above consensus of -21.3.

With exception of Insurance, Mechanical engineering, Construction and Telecommunications, the profit expectations of financial experts improved. After a strong decline to a balance of -57.8 in July, the automobile sector recovered slightly to a balance of -41.3 in August. Services (+0.7 points to a balance of 29.2) and Banks (+4.7 points to a balance of -14.8) also increased in August.

US: July Small Business Optimism

The National Federation of Independent Business index of small business optimism rose by 0.7 points in July to 107.9. The reading is just 0.1pp lower than the historical high of 108.0 registered in September 1983.

The detail showed further improvement in hiring, with plans to hire (from 20% to 23%) and firms reporting positions not able to fill right now (from 36% to 37%, a new high for the current expansion) both up in July. Earnings also showed positive signs, with a net 32% of firms reporting a rise in compensation (vs. previous 31%) and another 22% plan to raise compensation in coming months (vs. previous 21%).

Optimism about future economic activity has also improved in July, with 35% of firms expecting a better economy (vs. previous 33%) and 29% of survey respondents expecting higher sales (vs. previous 36%). 30% of firms plan to increase capital spending over coming months (vs. previous 29%).

US: August Home Builders’ Confidence

The NAHB housing market index fell from 68 in July to 67 in August, in line with market expectations. This marked a drop to 11-month low, on rising construction costs and shortages of skilled labour. Prospective buyers’ traffic sub-index fell to 49 in August, vs. 51 in July.

UK: July CPI Report:

The headline CPI inflation accelerated from 2.4% y/y in June to 2.5% y/y in July, in line with consensus expectations. The main upward pressure on the inflation rate came from cost of fuel, transport tickets, recreational goods and food. Excluding energy, food, alcohol and tobacco, inflation stood unchanged at 1.9% y/y in July, matching the consensus forecast.

GLOBAL HIGHLIGHTS:

Eni: the company was granted a new exploration license offshore Egypt (Bloomberg)

Galp: Sonangol is in talks with foreign oil firms with presence in Angola to sell its stake in Galp (Bloomberg)

Telefonica: Movistar, the Mexican arm of Telefonica, analyzes possible collaboration with Altan in Mexico (Bloomberg)

Spain: according to a poll published by ElDiario.es, Socialist party leads with 28% of votes, followed by PP with 25.5% of voting intentions. CIudadanos fell to the third place with 19.4% (Bloomberg)

Vodafone: the company filed complaint to Spanish regulator CMNV against Movistar over its soccer programming (Bloomberg)

WHAT TO WATCH TODAY: retail sales in the UK, trade balance in the Eurozone and the housing report in the US will be the principle economic data released today. 

Central Bank of Mexico will release its Monetary Policy Minutes.

In the US, Applied Materials, Gap, Walmart, Nordstrom, NVIDIA will publish their quarterly results today.

For further information, or to receive the PDF file, please contact +351 912 897 835 or research@fincor.pt

--------------------------------------------------------------------------------------------------------------------------------------------------------

Disclaimer

The information and opinion contained in this report was prepared by PATRIS - SOCIEDADE CORRETORA, SA ("Patris"), which is part of the group of companies whose holding is PATRIS INVESTIMENTOS, SGPS, SA (Patris Group), listed in Alternext, which holds 100% of the share capital and voting rights of REAL VIDA SEGUROS SA which, in turn, holds 100% of the share capital and voting rights of Patris.

The information contained herein is based on publicly available data obtained from sources believed to be reliable and has not been subject to independent verification. To the extent permitted by applicable law, Patris does not expressly or impliedly guarantee the accuracy, completeness and / or correctness of such data, or any omission. This document, or part thereof, may not be (i) modified, (ii) transmitted or distributed or (iii) copied or duplicated by any means or means, without the prior written consent of Patris.

The analysts involved in the preparation of this report did not receive, receive and will not receive any compensation, direct or indirect, based on the information contained in this report.

PATRIS - SOCIEDADE CORRETORA, SA or another company of the Patris Group or its respective shareholders, management, and / or employees may carry out personal transactions on the securities referred to in this report, at any time and without prior notice.

Any opinion contained in this report may be outdated as a result of changes in market conditions, applicable laws and other factors. It should also be considered that the analyst may make changes to the estimates, assumptions and evaluation methodology used.

This report has been prepared for information purposes only, not taking into account the specific investment goals, financial situation and particular needs of any specific person who may receive the report. This report therefore has no specific recipient.

Patris is subject to high internal standards of behavior associated with the capital market, prepared on the basis of the applicable legislation of the Portuguese State and the European Union, which include rules to prevent and avoid conflicts of interest and barriers to the disclosure of information.

Investors should bear in mind that the rate of return on the securities identified in this report - if any reference is made to those returns - may vary and the price of such securities may rise or fall. Investors should thus be aware that they may receive less than initially invested. While this report may refer to the historical performance of securities, past performance is no guarantee of future performance. In addition, market conditions, applicable laws and other factors that have an effect on performance are all likely to change, with the consequent change in the information contained in this report. Patris or any other company of the Patris Group does not accept, to the extent permitted by applicable law, any liability, whether direct or indirect, resulting from losses that may arise due to the use of the information contained in this report.

Patris's activity is overseen by the Bank of Portugal and the Securities Market Commission.

The price of the securities referred to in this report refers to the closing price of the day indicated, except when expressly indicated, based on another form of quotation.

Voltar