EUROPE MARKETS: European Stocks Edge Down Ahead Of Yellen Taking The Stage
26 Agosto 2016 - 8:53AM
Dow Jones News
By Carla Mozee, MarketWatch
Vivendi, Mediaset tussle continues; Volkswagen reaches U.S.
dealer agreement
European stocks eased Friday, as investors waited to hear from
Federal Reserve Chairwoman Janet Yellen for clues about what's next
for U.S. interest rates.
The Stoxx Europe 600 slipped 0.1% to 341.64. Only the basic
materials , oil and gas and industrial sectors showed modest
gains.
A fall in shares of Vivendi SA (VIV.FR) was helping keep the
pan-European benchmark headed toward its second daily loss in a
row. The Stoxx 600 was still on pace to rise 0.4% for the week,
which would come after last week's pullback of 1.7%.
Fund tracker EPFR on Friday said more than $2 billion flowed out
of European equity funds in the week ended Wednesday. That marked
the 29th consecutive weekly outflow, extending the longest
redemption streak on record.
Fed speak: After a week of waiting on the sidelines of the
market, investors finally get to hear Yellen speak at the Fed's
summit in Jackson Hole, Wyo. She's slated to appear at 3 p.m.
London time, or 10 a.m. Eastern Time, and her comments will be
watched for hints as to whether an interest rate hike is coming in
September.
If Yellen's tone is hawkish, traders "are not going to be
particularly happy that easy money is leaving town, so we may see a
sell-off in the equity market and in gold as well," said Naeem
Aslam, chief market analyst at ThinkMarkets, in a note.
"The possibilities of the U.S. increasing the interest rate are
... higher if you look at the global situation," he said. "We do
not have the kind of storm which was previously experienced in the
emerging markets and commodity prices have stabilized. This creates
a perfect scenario for [Yellen] if she wants to achieve the
normalization of monetary policy."
Before Yellen's speech, the euro exchanged hands at $1.1289,
little changed from $1.1281 late Thursday in New York.
Read:The head of Germany's Deutsche Bank says negative rates are
'fatal'
(http://www.marketwatch.com/story/the-head-of-germanys-largest-bank-says-negative-rates-are-fatal-2016-08-25)
Vivendi tussle: In focus Friday was Vivendi SA (VIV.FR), whose
shares slumped 4%. The media company's second-quarter adjusted
earnings fell 3.1% to 187 million euros ($211 million), missing
analyst expectations. Vivendi said it's cutting EUR300 million in
costs from its pay-TV unit Canal Plus.
At the same time, shares of Mediaset SpA (MS.MI) fell 1.3% after
Vivendi, which has been seeking to amend an agreement with Mediaset
(http://www.marketwatch.com/story/vivendi-plans-costs-cuts-at-tv-unit-2016-08-26)
to buy its pay-TV business, said Thursday the contract could become
void Sept. 30. Mediaset reiterated that the contract is binding and
that it remains unwilling to change the terms of the deal.
Movers: Gemalto NV (GTO.AE) shares surged 5.3% after the SIM
card maker's quarterly results came in above expectations.
Volkswagen AG (VOW.XE) picked up 2.1% after the German auto
maker reached an agreement with about 650 U.S. franchise dealers
(http://www.marketwatch.com/story/vw-strikes-deal-with-us-franchise-dealers-2016-08-26)
affected by the company's diesel-emissions scandal. A Sept. 30
deadline was set to complete the details.
Amec Foster Wheeler PLC (AMFW.LN) shares leapt 5.4% after Morgan
Stanley upgraded its rating for the energy engineering company to
overweight from equalweight.
BAE Systems PLC (BA.LN) rose 2.1% after the defense company's
rating was upgraded to buy from hold at Berenberg.
Indexes: Germany's DAX 30 shed 0.3% to 10,498.11. France's CAC
40 fell 0.1% to 4,402.82.
Italy's FTSE MIB fell 0.5% to 16,627.00, while Spain's IBEX 30
was off 0.1% at 8,587.40. The U.K's FTSE 100 was up 3 points at
6,819.65.
Data:Lending to eurozone firms increased
(http://www.marketwatch.com/story/ecb-data-show-rise-in-eurozone-lending-to-firms-2016-08-26)
at a faster yearly pace in July than in the previous month,
European Central Bank data showed, potentially reducing the need
for further monetary stimulus.
Consumer confidence in France rose to 97 in August from 96 in
July
(http://www.marketwatch.com/story/french-consumer-confidence-ticks-up-in-august-2016-08-26),
while economists had expected no improvement, Insee said Friday. In
addition, France's gross domestic product stalled in the second
quarter, according to a second print from the statistics agency.
The economy expanded by 0.7% in the first quarter.
GFK said German consumer sentiment is expected to improve
(http://www.marketwatch.com/story/german-consumer-confidence-set-to-rise-gfk-2016-08-26)
in September, and that could mark short-lived concerns about the
impact of Brexit on Europe's largest economy.
(END) Dow Jones Newswires
August 26, 2016 07:38 ET (11:38 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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