There is little movement in the European equity markets this morning as traders remain subdued.
Not much has changed on the geopolitical or macro-economic front, and that is why stock markets have been experiencing small moves.
Shares in TUI are down 0.75% today even though the travel company stated it expects full-year earnings to grow by at least 10%. The firm also stated volumes at the UK division were in line-in with last year’s robust performance.
Ryanair shares are down 2.2% after the airline announced yesterday another round of flight cancelations, and the disruption would last until March 2018. All things considered, the share price is holding up well, but the market won’t know the impact to the company’s reputation for a few months.
CRH and Ashtead are being helped by the Donald Trump’s plans to make the US tax system more pro-business. Both companies derive are large amount of their revenue in the US, and a more business focused US economy could see both companies ramp up earnings.
The EUR/USD has bounced back a small bit this morning after enduring a decline recently. The US dollar has been in demand thanks to slightly hawkish comments from Federal Reserve Chair Janet Yellen earlier this week. The potential changes to the US tax system is also helping the US dollar, as the proposals are very pro-business. At 1pm, Germany will announce the latest CPI data, and economists are expecting the rate to remain at 1.8%.
The GBP/USD is a touch lower today as the greenback is still making headway against the pound. The currency pair has been drifting lower lately as profit taking, and a resurgence in the US dollar were behind the move. Mark Carney, the Governor of the Bank of England (BoE), said the final deal the UK government reached over Brexit will have a big impact on the economy, and the BoE could influence the trickle-down effect.
We are expecting the Dow Jones to open 4 points lower at 22,336, and we are calling the S&P 500 down 2 points at 2505.
At 1.30pm, the US will announce the final reading of second-quarter GDP, and the consensus is for 3%. At the same time, the jobless claims report will be released and traders are expecting a reading of 270,000, and that compares with the previous reading of 259,000.
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