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Market Outlook - October 31st - November 4th PDF Print E-mail

Market Outlook

- WALL STREET:
US indices finished higher last week. On the economic front, the University of Michigan Confidence index for October rose to 60.9 from 57.5 the previous month while personal spending and personal income were up 0.6% and 0.1% MoM respectively in September. Also, GDP rose 2.5% QoQ as expected in 3Q while durable goods orders fell 0.8% in September. The Conference Board's sentiment index fell to 39.8 in October from 46.4 the previous month. Looking at corporate news, HP decided to keep its Personal Systems Group and Merck & Co posted 3Q non GAAP EPS of $0.94 vs $0.91 expected and $0.85 a year ago. Most sectors rallied, led by diversified financials, materials and real estate, while only retailing, household and personal products lost ground. From a technical perspective, the S&P500 index continued to rebound and broke above the 1260 resistance. The index should challenge its resistance area 1290-1300 in sight before any further upsides.

- EUROPE:
The FTSE 100 gained 3.89% over the week. Technically, the index broke above its 5600 MT key resistance and 100D MA but bounced back from its 5750 resistance. The FTSE may trade between 5600 and 5750 and should test its upper boundary first. Looking at economic statistics, the UK GfK consumer confidence survey fell to -32 in October vs -30 a month earlier. In Europe, euro zone consumer confidence was -19.9 in October in final estimation, unchanged vs the prior one. In Germany, consumer prices were flat in October (+0.1%) expected vs +0.1% in September. European indices posted a strong rally last week. The CAC and the DAX rose by 5.59% and 6.28% respectively and the IBEX gained 4.2%. All sectors in Europe finished the week with positive gains. Basic resources, automobile and parts, and industrial goods were the top performers. The Stoxx600 broke above its 100D MA and is supported by a ST rising trend line, aiming at 262.

 

  October 31st - November 4th

border=0 Market Round up

 

Weekly chg (%)

Last

Dow Jones

3.6

12231.1

Nasdaq 100

2.8

2401.3

Dax Xetra

6.3

6346.2

Cac 40

5.6

3348.6

border=0 Foreign Exchange

Euro/dollar : the pair is posting a rebound but stands below its new resistance, the RSI lacks upward momentum. SHORT position below 1.40 with 1.35 & 1.315 in sight.

Dollar/yen : the pair remains under pressure and is challenging its previous low. SHORT position below 79.5 with 75.5 & 73.75 in sight.

Company preview

border=0 Credit Suisse (CHF 26.41 ; 7.18% ; CSGN ; CSGN.VX)
Tuesday, Credit Suisse, the Swiss bank, is expected to post 3Q EPS of SF0.54 and sales of SF6.35B, compared to EPS of SF0.48 and sales of around SF7B a year earlier. The bank was rated "hold" at Commerzbank and "neutral" at Barclays Capital while Citigroup revised its price estimate on the bank to SF28.50 from SF31.00 ("buy" rating affirmed). From a chartist point of view, the stock price is now challenging its horizontal resistance around SF27.50, and should post a consolidation in sight before further upsides towards SF30.

border=0 Pfizer (USD 19.82 ; 3.99% ; PFE ; PFE.N)
The same day, Pfizer, the US pharmaceutical firm, could report 3Q EPS of $0.56, up from $0.54 a year ago on sales of $16.5B, compared to $16.2B. The Co said last week it finalized the acquisition of Icagen, a biopharmaceutical company, for $6.00 per share in cash. Technically, the stock is accelerating on the upside after the break above its previous resistance at $19.10. Next up targets are set at $21 and $21.5, as long as $19.10 is not broken.

border=0 Sanofi (EUR 52.19 ; 1.36% ; SAN ; SASY.PA)
Thursday, Sanofi, the French drug maker may announce 3Q EPS of E1.76 vs E1.47 in the same prior year period and sales of nearly E9B, up from 7.82B. Earlier, the Co said it expected to deliver sales growth of at least 5% on average over 2012-2015 and to generate an additional E2B of cost synergies with Genzyme by 2015 through a new cost-control plan. Graphically, the stock has broken above a key resistance at E51, which should open the upside way to E56.

border=0 Unilever (EUR 24.64 ; 0.14% ; UNA ; UNc.AS)
Also on Thursday, Unilever, 3Q sales are expected at E12.0B (vs E11.5B a year earlier) and net income may reach appx. E1.2B (vs E1.25B last year). The Co announced on October 14, it agreed to acquire 82% of Concern Kalina, "the leading Russian beauty company" for 21.5B rubles or appx. E500M. Technically, the share remains bullish on both ST and MT views. The ascending 20-day moving average plays well as a support, and should push the price higher towards E25.5 in the coming days.

border=0 International Consolidated Airlines (GBp 171.5 ; 4.13% ; IAG ; IAG.L)
Friday, International Consolidated Airlines, the European airline carrier's 3Q EPS is seen at E0.15, up from E0.02 in 3Q10, on sales of E4.7B, compared to E3.9B. Group traffic measured in Revenue Passenger Kilometres rose by 4.3% on the year in September, vs +2.2% in August and +3.5% in July. The Co also approved the launch of a low-cost airline in Spain, Iberia Express, for the summer of 2012. From a technical view, the stock has validated an inverted "H&S" pattern, and is now expected to challenge 180p before further upsides to 190p.

Selection of those events which may affect the stock prices of international Large Caps


Corporate Calendar October 31st - November 4th

Date

Market

Company

Event

border=0 Monday, October 31st

 

NE

TNT Express

3rd-Quarter results

 

SZ

Clariant

3rd-Quarter results

 

UK

Barclays

3rd-Quarter results

 

US

Allstate

3rd-Quarter results

 

US

Anadarko Petroleum

3rd-Quarter results

 

US

Loews Corp

3rd-Quarter results

border=0 Tuesday, November 1st

 

DE

Danske Bank

3rd-Quarter results

 

NE

DSM

3rd-Quarter results

 

SZ

Credit Suisse

3rd-Quarter results

 

UK

Imperial Tobacco

annual results

 

US

Pfizer

3rd-Quarter results

 

US

Pitney Bowes

3rd-Quarter results

border=0 Wednesday, November 2nd

 

GE

Fresenius SE

3rd-Quarter results

 

SW

Lundin Petroleum AB

3rd-Quarter results

 

UK

Randgold Resources

3rd-Quarter results

 

US

Kraft Foods

3rd-Quarter results

 

US

Mastercard

3rd-Quarter results

 

US

Time Warner

3rd-Quarter results

border=0 Thursday, November 3rd

 

FR

BNP Paribas

3rd-Quarter results

 

FR

Sanofi

3rd-Quarter results

 

GE

BMW

3rd-Quarter results

 

UK

BT Group

1st-Half results

 

UK

Unilever

3rd-Quarter results

 

US

AIG

3rd-Quarter results

border=0 Friday, November 4th

 

FR

Alcatel - Lucent

3rd-Quarter results

 

FR

Lafarge

3rd-Quarter results

 

UK

International Consolidated Airlines

3rd-Quarter results

 

UK

Royal Bank Of Scotland Group

3rd-Quarter results

 

US

Berkshire Hathaway

3rd-Quarter results

 

US

Windstream

3rd-Quarter results


Economic Calendar (CET) October 31st - November 4th

Date

Market

Economic data

Period

Expected

Last

border=0 Monday, October 31st

08:45:00

FR

Producer Price Index (MoM)

SEP

NA

0%

10:30:00

UK

M4 Money Supply (MoM)

SEP

NA

-0.2%

10:30:00

UK

Net Consumer Credit (Mln)

SEP

NA

.5

11:00:00

EC

Euro-Zone: Unemployment Rate

SEP

NA

10%

12:59:00

GE

Retail Sales (MoM)

APR

1%

-2.7%

14:45:00

US

Chicago Purchasing Manager Index

OCT

59

60.4

border=0 Tuesday, November 1st

10:30:00

UK

GDP (QoQ)

2Q

NA

0.1%

15:00:00

US

Construction Spending (MoM)

SEP

0.2%

1.4%

15:00:00

US

ISM - Manufacturing

OCT

52.3

51.6

15:00:00

US

ISM - Price Paid

OCT

NA

56

22:00:00

US

Total Vehicule Sales (Mln)

OCT

13.09

13.04

22:00:00

US

Domestic Vehicule Sales (Mln)

OCT

10.24

10.17

border=0 Wednesday, November 2nd

09:55:00

GE

Unemployment Change (Thsd)

OCT

NA

-26

09:55:00

GE

Unemployment Rate

OCT

NA

6.9%

15:30:00

US

Crude Oil Inventories (WoW chg)

W43

NA

4735

17:30:00

US

Fed: Rates decision

 

0.25%

0.25%

border=0 Thursday, November 3rd

13:30:00

US

Nonfarm Productivity

2Q

2.7%

-0.7%

13:30:00

US

Unit Labor Costs

2Q

-0.7%

3.3%

13:45:00

EC

ECB: Rates decision

 

NA

1.5%

15:00:00

US

Factory Orders

SEP

0%

-0.2%

15:00:00

US

ISM - Non Manufacturing

OCT

53.9

53

border=0 Friday, November 4th

11:00:00

EC

Euro-Zone: PPI (MoM)

SEP

NA

-0.1%

13:30:00

US

Unemployment Rate

OCT

9.1%

9.1%

13:30:00

US

Change in Nonfarm Payrolls (Thsd)

OCT

95.24

103

13:30:00

US

Change in Manufact. Payrolls (Thsd)

OCT

NA

-13


 


This document does not constitute financial advice. If you require such advice, you should seek appropriate professional advice. Internaxx accepts no responsibility for the content of this newsletter.

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