MARKETS EUROPE/German yield at the highest level in eleven years | news
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By Herbert Rude
FRANKFURT (Dow Jones) — An unexpectedly significant increase in US producer prices pushed prices on the European stock exchanges back into the red on Wednesday afternoon. The DAX fell slightly in the afternoon by 0.1 percent to 12,204 points, the Euro-Stoxx-50 fell by 0.2 percent to 3,332 points. The reaction on the bond markets in particular is depressing the mood: yields on 10-year Bunds have risen there to their highest level since April 2010.
“Without a strong recovery in bonds, however, a thorough reversal in equities is hardly imaginable,” said one market participant. The stock market has recently looked at bond yields like a rabbit at a snake.
“The expectation of a large US interest rate hike of 75 basis points in November should now increase further,” said one market participant with a view to US producer prices. A break or even an end to the rate hike cycle is not yet in sight, he says. However, the harder the Fed fights inflation, the faster the fight can be won.
US producer prices rose 0.4 percent in September, twice as fast as expected. Contrary to hopes, the core rate did not fall below expectations either, with an increase of 0.3 percent. The yield on the 10-year US bond rises to 3.95 percent. “The question is whether the 4 percent mark will fall or hold,” said one market participant. The euro is almost unchanged around $0.97.
BASF numbers in the black
In addition to chemical stocks, only a few defensive or non-cyclical sectors are in positive territory. Most industry indices are in the red. The Stoxx sub-index of chemical stocks benefits from BASF. These increase by 1.5 percent. The market is relieved by the interim report. On the one hand, the adjusted EBIT of 1.35 billion euros is 50 million euros above the consensus. On the other hand, the chemical company has confirmed its outlook, which means that the profit warning feared by some has not materialized.
In addition, Bayer rose by 1.2 percent in the DAX, Daimler Truck by 2.4 percent and RWE by 1.5 percent. On the other hand, Brenntag lost another 2.9 percent and Vonovia 4.3 percent.
Philips warns and LVMH convinces
Philips is down 12.5 percent after a profit warning. The analysts at ING speak of the second profit warning this year. The company is being impacted by ongoing supply chain issues that are impacting shipments and customer installations. The weakness is in the healthcare systems area, while the consumer business is doing well. In the wake of Philips, Siemens Healthineers became cheaper by 5.1 percent in the DAX.
New sales figures from LVMH (+2.3%) are well received. The luxury goods group was able to carry the momentum from the first half of the year and organically increased sales in the third quarter by 19 percent to 19.76 billion euros. That’s 5 percent above consensus, according to analysts at RBC. The experts speak of a positive signal for the entire industry. Hermes gain 1.7 percent and Dior 2 percent.
Cropenergies are hawking – Klöckner & Co on a downward slide
Gerresheimer (+3.8%) rated the figures for the third quarter as “solid”. While the increase in sales was slightly lower than in the previous quarter, the adjusted operating result, which increased organically by 13.3 percent and was above the consensus at EUR 90.5 million, was convincing. The confirmation of the outlook completes the positive picture.
Cropenergies achieved record sales in the second quarter and tripled its operating result, which means the share is up a good 11 percent. “The company is extremely dependent on the price of ethanol,” a trader points out. This was extremely stimulating in the second quarter. Cropenergies has confirmed the recently raised outlook.
The steel trader Klöckner & Co only expects an operating result of 16 million euros in the third quarter, well below the forecast 50 to 100 million euros. For the financial year as a whole, the company now expects around 400 instead of more than 500 million euros. Oddo BHF has downgraded the share to “neutral”. The stock falls 9 percent.
Stock index last +/-% absolute +/-% YTD
Euro-Stoxx-50 3.336,97 -0,1% -3,38 -22,4%
Stoxx 50 3,349.40 +0.0% 1.14 -12.3%
DAX 12.202,31 -0,1% -17,94 -23,2%
MDAX 21,977.56 -1.0% -214.74 -37.4%
TecDAX 2.679,95 -0,4% -11,19 -31,6%
SDAX 10,306.67 -1.1% -113.30 -37.2%
FTSE 6.831,93 -0,8% -53,30 -6,8%
CAC 5.823,70 -0,2% -9,50 -18,6%
Fixed income market last absolute +/- YTD
German ten-year return 2.37 +0.08 +2.55
US 10-year yield 3.94 -0.00 +2.43
FOREX last +/- % Wed, 8:23 Tue, 17:08 % YTD
EUR/USD 0,9691 -0,1% 0,9719 0,9719 -14,8%
EUR/JPY 142.32 +0.6% 142.12 141.59 +8.7%
EUR/CHF 0.9662 -0.1% 0.9677 1.0036 -6.9%
EUR/GBP 0,8779 -0,7% 0,8841 0,8759 +4,5%
USD/JPY 146,87 +0,7% 146,20 145,71 +27,6%
GBP/USD 1,1038 +0,6% 1,0990 1,1097 -18,4%
USD/CNH (Offshore) 7,1863 +0,2% 7,1632 7,1706 +13,1%
BTC/USD 19.117,43 +0,6% 19.103,18 19.074,83 -58,7%
ROHOEL last VT-Settlem. +/- % +/- USD % YTD
WTI/Nymex 88,23 89,35 -1,3% -1,12 +25,4%
Brent/ICE 93,11 94,29 -1,3% -1,18 +26,6%
GAS VT-Settlem. +/- EUR
Dutch TTF 157,00 156,78 +0,1% +0,22 +137,9%
METALS last day before +/- % +/- USD % YTD
Gold (Spot) 1.671,35 1.666,10 +0,3% +5,25 -8,6%
Silver (Spot) 19.14 19.23 -0.4% -0.08 -17.9%
Platinum (Spot) 889.93 890.05 -0.0% -0.13 -8.3%
Kupfer-Future 3,44 3,47 -0,9% -0,03 -22,2%
YTD relative to previous day’s close
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(END) Dow Jones Newswires
October 12, 2022 10:02 AM ET (2:02 PM)
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