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European stocks lower as investors digest earnings; Germany needs reforms - IMF

Published 29/10/2024, 09:08
© Reuters.
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Investing.com - European stock markets slipped lower Tuesday, as investors digested quarterly results from some of the region’s largest companies. 

At 11:00 ET (15:00 GMT), the DAX index in Germany traded 0.1% lower, the CAC 40 in France fell 0.4%, and the FTSE 100 in the U.K. dropped 0.6%.

HSBC announces $3bn buyback

The quarterly corporate earnings season continued Tuesday, with traders digesting results from a number of senior companies.

HSBC (LON:HSBA) stock rose 4% after the Asia-focused bank reported a stronger-than-expected third-quarter profit amid sustained strength in its wealth management unit, and announced a hefty $3 billion buyback.

Adidas (OTC:ADDYY) stock rose 3.3% after the German sportswear maker said it saw strong underlying growth in Greater China in the third quarter, while sales in North America excluding the Yeezy collection were up on the year.

Mapfre (BME:MAP) stock rose 4.6% after Spain's largest insurer reported its net profit rose substantially in the first nine months of the year as higher prices and a more benign weather and less severe natural disasters lifted its non-life business' profitability.

On the flip side, BP (NYSE:BP) stock fell over 4% after the British energy giant reported third quarter profits of $2.3 billion, its lowest in almost four years, weighed down by a drop in refining profits and weaker oil trading. 

Across the pond, Google parent Alphabet (NASDAQ:GOOGL) is due to report later Tuesday, the first result from the five of the "Magnificent Seven" US tech stocks due this week.

German consumer sentiment edges higher

Elsewhere, German consumer sentiment is set to continue to recover heading into November, with the GfK consumer sentiment index rising to -18.3 points from a slightly revised -21.0 the month before. 

While this shows an improvement, it comes from a low base and the survey showed that economic expectations for the next 12 months for Europe's largest economy fell for the third time in a row.

Germany needs both structural reforms and more investment in public infrastructure to overcome recession, the European head of the International Monetary Fund said in an interview Tuesday.

"Without a functioning infrastructure, there can be no productive economy," Alred Kammer said.

The European Central Bank has cut interest rates three times already this year, all by 25 basis points, but economic weakness, particularly from Germany, has raised the potential of a larger rate cut at the next policy-setting meeting.

Crude steadies after selloff 

Oil prices steadied on Tuesday after the previous session’s sharp losses, with the tense situation in the Middle East the main driving force.

By 11:00 ET, the Brent contract climbed 0.2% to $71.14 per barrel, while U.S. crude futures (WTI) traded 0.3% higher at $67.60 per barrel.

Both benchmarks slumped 6% on Monday to their lowest since Oct. 1 after Israel's retaliatory strike on Iran at the weekend bypassed Tehran's oil infrastructure, avoiding the disruption of supplies from this crude-rich region.  

Helping the tone was Monday’s news that the U.S. was seeking up to 3 million barrels of oil for the Strategic Petroleum Reserve for delivery through May next year.

 

 

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