A review of US and European Equity Markets - Provided by Internaxx Print E-mail
US markets were volatile last week as the relief provided by the Fed's $200bln liquidity injection was overshadowed by Bear Stearns' bailout from the Fed and JPMorgan.

The Fed may announce Tuesday a 50bps rate cut to 2.5%, the lowest level since March 2005. This morning the Fed announced new measures to increase liquidity in the credit market including a 25bps cut in the discount rate to 3.25%. Stocks in the Health Care Equipment, Automobiles & Compo. and Diversified Financials sectors posted the biggest WoW declines. Shares in the Consumer Services and Materials sectors gained WoW. This week, expect indices to remain under pressure with downside risk intact.

 

 

 

European markets were also under pressure except in Spain where the Ibex 35 gained 2.6% WoW. Record oil prices and euro against the dollar continued to pressure shares in the Travel & Leisure and Technology sectors. On the upside, shares in the Food & Beverage benefited from upbeat comments from Nestle and their defensive aspect in a bear market. The risk is for further downside this week and European markets should follow the trend set on Wall Street.

 

 
Go to : Company preview, Economic Calendar, Corporate Calendar
March 17th - March 21st
 
MARKET ROUND UP
  Weekly chg (%) Last
Dow Jones 0.5       11951.1
Nasdaq 100 0.4       1713.8
Dax Xetra -1       6451.9
Cac 40 -0.6       4592.2
    
 
FOREIGN EXCHANGE
Euro/dollar : The daily RSI is overbought but do not show any reversal sign & the pair is supported by a ST rising trend line. LONG @ 1.55 with 1.652 in sight.

Dollar/yen : the pair has broken below the 101.65 strong support area (channel lower boundary & strong horizontal support). Down move towards 95.2 & 93.


COMPANY PREVIEW
Generali (EUR 27.29 ; -1.48% ; G ; GASI.MI)

On Tuesday, Generali may deliver FY07 net income of E3bln. At the beginning of last week, the Co announced to have completed the acquisition of Banca del Gottardo for appx. E1bln. A month earlier, the Co reported FY07 premiums up 2.7% to E65bln compared to E63bln a year ago. Furthermore, the Co has received approval to create a new liability unit by Chinese regulators.


Goldman Sachs (USD 156.86 ; -2.01% ; GS ; GS.N)

On the same day, Goldman Sachs is expected to post 1Q EPS of $2.59 compared to $6.67 a year earlier. The Sunday Telegraph reported the Co may announce $3bln in writedown. Friday the stock fell sharply on renewed concern about difficulties in US financial sector, highlighted by the Fed-JPMorgan bailout of Bear Stearns. Year to date GS is down 27% and heading towards a long term support area around $150-140.


Nike (B) (USD 59.96 ; 2.95% ; NKE ; NKE.N)

On Wednesday, Nike may unveil 3Q EPS of $0.79 ($0.68 a year ago) on sales of $4.3bln ($3.9bln). Last month, Nike announced to be the equipment supplier of the French Football Federation until the end of the 2017-2018 season. In the same period, the Co agreed to sell its Bauer Hockey unit for $200m to a group led by Kohlberg & Co. In January, the Co's £285m takeover offer was approved by Umbro's shareholders.


Saint-Gobain (EUR 48.42 ; -2.5% ; SGO ; SGOB.PA)

On Thursday, Sain-Gobain is expected to post FY07 net income of E2.1bln compared to E1.7bln a year ago on revenues of E43.4bln (E41.6bln). Earlier this month, the Co won European antitrust approval to acquire HeidelbergCement's Maxit unit for E2.13bln and completed the acquisition last week, which allowed the Co to double the size of its industrial mortars business.


Fedex Corp (USD 84.8 ; -2.19% ; FDX ; FDX.N)

Finally, FedEx Corp. may deliver 3Q EPS of $1.24 ($1.33 a year ago) on sales of $9.2bln ($8.6bln). In February, the Co's freight deliveries services were disturbed by tornadoes in the US. Fears of economic slowdown and high oil prices have been pressuring the stock. Below a declining trendline passing through $90, the risk is for a retest of the last 52w low at $80 reached on January 22, 2008 then $76.81, its lowest level since September 2005.



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

CORPORATE CALENDAR March 17th - March 21st
Date Market Company Event
 
Monday, March 17th
  GE Linde annual results
  GE Heidelbergcement annual results
  IT Finmeccanica annual results
  IT Banca Popolare Di Milano annual results
  UK Wolseley 1st-Half results
 
Tuesday, March 18th
  GE TUI annual results
  GE IVG Immobilien annual results
  IT Generali annual results
  US Goldman Sachs 1st-Quarter results
  US Lehman Brothers Holdings 1st-Quarter results
  US GameStop Corp 4th-Quarter results
 
Wednesday, March 19th
  US Morgan Stanley 1st-Quarter results
  US Nike (B) 3rd-Quarter results
  US General Mills 3rd-Quarter results
  US AES Corporation 4th-Quarter results
  US Discover Financial Services 1st-Quarter results
  US Cintas 3rd-Quarter results
 
Thursday, March 20th
  FR Saint-Gobain annual results
  FR Hermes annual results
  GR OTE annual results
  US Carnival 1st-Quarter results
  US Fedex Corp 3rd-Quarter results
  US KB Home 1st-Quarter results
 
Friday, March 21st
    No major expectations  

ECONOMIC CALENDAR (CET) March 17th - March 21st
Date Market Economic data Period Expected Last
 
Monday, March 17th
13:30:00 US Empire Manufacturing MAR -5.93 -11.72
14:15:00 US Industrial Production (MoM) FEB -0.1% 0.1%
14:15:00 US Industrial Capacity Utilization FEB 81.3% 81.5%
18:00:00 US NAHB Housing Market MAR 20 20
 
Tuesday, March 18th
10:30:00 UK CPI - EU Harmonised (MoM) FEB 0.7% -0.7%
13:30:00 US Producer Price Index (MoM) FEB 0.5% 1%
13:30:00 US PPI - Ex Food & Energy (MoM) FEB 0.2% 0.4%
13:30:00 US Housing Starts (Thsd) FEB 992 1012
13:30:00 US Bulding Permits (Thsd) FEB 1021 1061
19:15:00 US Fed: Rates decision 03/18/2008 2.5% 3%
 
Wednesday, March 19th
  GE Import Prices (MoM) FEB NA 0.8%
11:00:00 EC Euro-Zone: Trade Balance (Bln) JAN NA -4249
11:00:00 EC Euro-Zone: Trade Balance (Bln) (MoM) JAN NA -4249
 
Thursday, March 20th
10:30:00 UK M4 Money Supply (MoM) FEB NA 1.4%
10:30:00 UK Public Finances (PSNCR) (Bln) FEB 2.44 -22118
10:30:00 UK Retail Sales (MoM) FEB -0.1% 0.8%
13:30:00 US Initial Jobless Claims (Thsd) W10 NA 353
15:00:00 US Leading Indicators FEB -0.3% -0.1%
15:00:00 US Philadelphia Fed. MAR -17.02 -24
 
Friday, March 21st
08:45:00 FR Consumer Spending (MoM) FEB 0.4% -1.2%
08:45:00 FR Wages (QoQ) 4Q NA 0.3%

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. Investors are not authorized to copy, reproduce, duplicate, sell, resell or exploit any portion of the Newsletter for their own commercial purposes. In that case, Internaxx will immediately end the subscription.


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