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European Stock Futures Edge Higher; SocGen, Unicredit 1Q in Focus

Stock MarketsMay 06, 2021 07:30
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By Peter Nurse - European stock markets are seen edging higher at the open, continuing the positive tone from the previous session, as investors digest more corporate earnings ahead of a Bank of England meeting.

At 2:05 AM ET (0705 GMT), the DAX futures contract in Germany traded 0.1% higher, CAC 40 futures in France climbed 0.1% and the FTSE 100 futures contract in the U.K. rose 0.1%. 

The major European indices closed substantially higher Wednesday, with the DAX gaining 2.1%, the FTSE 100 1.7% and the CAC 40 1.4%, having their best day in nearly two months as resource stocks jumped and data showed Eurozone business activity picked up in April.

Given these hefty gains a further substantial move higher Thursday may prove difficult, but the overall tone remains positive as the first-quarter earnings season continues.

Societe Generale (OTC:SCGLY) is likely to be in the spotlight Thursday after the French banking giant handily beat expectations in its first quarter, boosted by a strong performance in its global markets division. Italian banking giant Unicredit (MI:CRDI) also posted a respectable rebound, amassing its biggest ever cushion for payments to shareholders. 

Volkswagen (DE:VOWG_p), Europe's largest carmaker, raised its operating margin target for 2021, pointing to stronger demand for more profitable cars during the first three months of the year. 

ArcelorMittal (NYSE:MT), the world's largest steelmaker, reported higher than expected first quarter earnings, while EssilorLuxottica (PA:ESLX), the maker of Oakley and Ray-Ban glasses, said its first-quarter sales were boosted by a strong rebound in China and the United States.

Earnings are also scheduled from blue chips Anheuser Busch Inbev (BR:ABI), Air France KLM (PA:AIRF) and ING (AS:INGA) among others.

Away from the corporate sector, the Bank of England announces its latest monetary policy decision later in the session and is widely expected to hold rates steady at 0.10% and keep its monthly bond purchases steady.

However, the central bank is also likely to significantly upgrade its growth outlook, which would increase expectations that its next move will be to tighten monetary policy rather than provide fresh stimulus to the economy as the pandemic eases.

German factory orders rose 3.0% in March, and later in the session sees the release of final U.K. composite PMI readings for April and Eurozone retail sales for March.

Oil prices edged higher Thursday following a huge fall in U.S. crude stockpiles, but gains are small as the recovery from the Covid-19 pandemic remains uneven. 

Government data from the U.S. Energy Information Administration late Wednesday showed crude stockpiles contracted by nearly 8 million barrels last week. This validated the earlier report from the American Petroleum Institute, an industry body, and points to crude oil stocks falling to their lowest level since late February.

That said, the EIA also detailed a larger-than-expected 737,000-barrel build in gasoline inventories, rising for the fifth straight week. 

U.S. crude futures traded 0.3% higher at $65.80 a barrel, while the Brent contract rose 0.3% to $69.19. 

Elsewhere, gold futures rose 0.5% to $1,792.65/oz, while EUR/USD traded 0.1% higher at 1.2010.


European Stock Futures Edge Higher; SocGen, Unicredit 1Q in Focus

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