Equity markets in Europe are experiencing low volatility today, as the outlook for the region remains unchanged. Stocks slipped yesterday as traders took profits following the recent positive run, and that strategy is continuing to play out today.
China reported mixed economic data last night as retail sales and fixed asset investments missed economists’ expectations, and grew at a slower rate, while industrial production topped forecasts. Growth in the second-largest economy in the world is cooling, and today’s updates add weight to that argument. Mining companies like Rio Tinto (LON:RIO), Glencore (LON:GLEN), BHP Billiton (LON:BLT), and Vedanta Resources (LON:VED) are lower today, as they are heavily dependent on China’s demand for minerals.
Shares in EasyJet (LON:EZJ) are flying high after the airline revealed a strong set of figures. First-half revenue exceeded £2 billion, with passenger levels at record highs. The airline reduced its loss to £68 million, from £236 million last year. The company lost money in the six-month period largely because of expansion costs at Tegel airport in Berlin. The outlook is positive too, as second-half bookings are at 57%. The airline predicts its full-year pre-tax profit will be between £530 million and £580 million, compared with £408 million last year. The stock has hit its highest level since January 2016 this morning, and if the bullish run continues, it could target 1,900p.
Vodafone (LON:VOD) shares are in the red after the company announced that CEO Vittorio Colao will be stepping down in September. Mr Colao has been at the helm for 10 years, and is credited with turning the company from a mobile operator into a telecoms giant. The company has a global presence, and offers a wide range of digital services. Recently, Vodafone agreed to acquire operations in Germany, Hungry, Romania and the Czech Republic from Liberty Global (NASDAQ:LBTYA), and this underlines the expansionist policies of Mr Colao.
GBP/USD ticked up after the UK released solid earnings figures. In March, UK average earnings excluding bonuses jumped by 2.9%, up from 2.8%.
EUR/USD is largely unchanged even though eurozone first-quarter growth cooled, the quarterly reading fell from 0.6% to 0.4% - meeting expectations.
At 1.30pm (UK time) US retail sales for March will be released, and the consensus is for a reading of 0.3%, down from 0.6% in February.
We are expecting the Dow Jones to open down 49 points at 24,850 and we are calling the S&P 500 down 6 points at 2,724.
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