MARKETS EUROPE/Weak US economic data and Snap weigh on sentiment

By Herbert Rude

FRANKFURT (Dow Jones) — Weak US templates weighed on the mood on the European stock markets on Tuesday. The DAX lost 1.8 percent to 13,920 points, the Euro Stoxx 50 1.6 percent to 3,648 points. The European purchasing manager indices turned out better than feared. “This means that a recession in Europe remains unlikely for the time being, despite rising interest rates and supply chain problems,” said one market participant. In the USA, however, weak economic data pointed to a downturn. In addition to falling purchasing manager indices, a significant slump in new construction sales weighed on the Dow Jones. In addition, Snap’s profit warning weighed on sentiment for technology stocks worldwide.

Utilities collapse with special tax report

Utilities were among the daily losers in Europe, shedding 2 percent in their Stoxx industry index. Shares in the UK’s biggest electricity companies plummeted as the government plans to impose a special tax on electricity generation, according to the Financial Times. Chancellor of the Exchequer Rishi Sunak has ordered the drafting of a possible special tax on more than £10 billion in excess power generator profits.

As a result, Drax shares fell nearly 14 percent, while SSE and Centrica fell 7 to 8 percent. But continental European suppliers were also under selling pressure. Here RWE fell by 4.4 percent, Eon lost 3.2 percent and EDF fell by 2.6 percent. However, introducing such a tax will be very complicated and could harm the government’s green agenda, according to RBC analysts.

Air France falls with capital increase – techs suffer from snap

Retail stocks, stocks from the travel and leisure industry and technology stocks fell even more sharply than utilities. In travel stocks, Air France KLM fell almost 21 percent. A capital increase of around 2.3 billion euros put pressure on the share price here.

Snap’s profit warning weighed on the tech sector, while high inflation weighed on retail. The trade-oriented tech stocks Zalando and Hellofresh were very weak in the DAX with discounts of more than 9 percent. She was also weighed down by a faint outlook from About You. These collapsed by 7.3 percent.

The banks were the beneficiaries of this development. With the ever steeper yield curve, the sector index gained 0.5 percent. Deutsche Bank rose 0.7 percent. The biggest winners in the DAX were Deutsche Börse with a plus of 1.9 percent. The high level of uncertainty on the market is leading to hedging at the futures exchange subsidiary Eurex, and the turnaround in interest rates is leading to a significant increase in interest income.

The figures from CTS Eventim were received positively by retailers, but the lack of an outlook was disappointing. Shares fell 3.6 percent.

Goodwill worth less – TAG plummet

TAG real estate collapsed by 14.4 percent. The environment for the real estate sector continues to be difficult in view of rising market and key interest rates. There was also a goodwill amortization.

The focus was on the Siemens Energy Capital Markets Day. Shares closed up 2.6 percent. The Group has set new medium-term return targets for its business areas. The focus continued to be on the integration of Siemens Gamesa.

The slide in Adler Group accelerated again. The course collapsed by more than 16 percent to 4 euros. As the Handelsblatt reported, citing people familiar with the events, the public prosecutor’s office is now investigating the accounting.

The industrial group Sulzer reported from Switzerland that it will withdraw from the Russian market. Here it went 3.5 percent lower.

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Index Closing Development Development Development

. was absolute in % since

. beginning of the year

Euro Stoxx 50 3,647.56 -60.83 -1.6% -15.1%

Stoxx 50 3,577.15 -34.98 -1.0% -6.3%

Stoxx 600 431.58 -4.96 -1.1% -11.5%

XETRA DAX 13,919.75 -255.65 -1.8% -12.4%

FTSE-100 London 7,484.35 -29.09 -0.4% +1.7%

CAC-40 Paris 6,253.14 -105.60 -1.7% -12.6%

AEX Amsterdam 679.88 -14.14 -2.0% -14.8%

ATHEX-20 Athens 2,078.89 +12.55 +0.6% -3.0%

BEL-20 Brussels 3,892.83 -45.62 -1.2% -9.7%

BUX Budapest 42,978.09 -479.49 -1.1% -15.3%

OMXH-25 Helsinki 4,789.55 -26.71 -0.6% -13.6%

ISE NAT. 30 Istanbul 2,632.50 -12.17 -0.5% +30.0%

OMXC-20 Copenhagen 1,644.72 -12.58 -0.8% -11.8%

PSI 20 Lisbon 6,079.51 +51.39 +0.8% +10.1%

IBEX-35 Madrid 8,631.20 +5.40 +0.1% -1.0%

FTSE-MIB Milan 23,876.08 -260.48 -1.1% -11.7%

RTS Moscow 1,273.73 +20.04 +1.6% -20.2%

OBX Oslo 1,138.64 -1.41 -0.1% +6.6%

PX Prague 1,308.55 -14.16 -1.1% -8.2%

OMXS-30 Stockholm 2,001.10 -17.77 -0.9% -17.3%

WIG-20 Warsaw 1,810.98 -25.89 -1.4% -20.1%

ATX Vienna 3,263.23 -14.72 -0.4% -14.9%

SMI Zurich 11,483.56 +17.28 +0.2% -10.8%

FOREX last +/- % Tue 8:16 Mon 18:06 % YTD

EUR/USD 1.0745 +0.5% 1.0672 1.0667 -5.5%

EUR/JPY 136.01 -0.5% 136.19 136.34 +3.9%

EUR/CHF 1.0315 -0.1% 1.0311 1.0309 -0.6%

EUR/GBP 0.8566 +0.9% 0.8483 0.8483 +2.0%

USD/JPY 126.57 -1.0% 127.63 127.81 +10.0%

GBP/USD 1.2542 -0.4% 1.2580 1.2575 -7.3%

USD/CNH (Offshore) 6.6580 -0.0% 6.6825 6.6610 +4.8%

Bitcoin

BTC/USD 29,414.54 +0.4% 29,364.19 30,380.31 -36.4%

ROHOEL last VT-Settl. +/- % +/- USD % YTD

WTI/Nymex 109.57 110.29 -0.7% -0.72 +50.6%

Brent/ICE 113.53 113.42 +0.1% 0.11 +49.4%

METALS last day before +/- % +/- USD % YTD

Gold (Spot) 1,869.39 1,853.50 +0.9% +15.89 +2.2%

Silver (Spot) 22.13 21.80 +1.5% +0.33 -5.1%

Platinum (Spot) 961.28 957.98 +0.3% +3.30 -1.0%

Copper Future 4.29 4.34 -1.2% -0.05 -3.7%

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Contact the author: [email protected]

DJG/hru/raz

(END) Dow Jones Newswires

May 24, 2022 12:10 PM ET (16:10 GMT)