European indices again rebounded from lower levels as the US market opened lower and quickly started working higher. The Stoxx 600 has now recovered just under 6% from its closing low on December 27th as it has consolidated over the last three days. With moves subdued today we saw a fairly even split of both individual names along with sectors up vs down. Personal Goods led, up over a percent with Food names not far behind. Losses were slight in the underperforming Industrials and Construction sector.
Deutsche Bank -.3% and Commerzbank +1.1% have received an initial thumbs up to a possible merger derived from a letter from the office of the Finance Ministry. In it, a Parliamentary Fin Sec noted they expect institutions should act in their best interest when asked about a possible merger. The German gov is a 15% holder, the largest, of Commerzbank.
Anheuser Busch rallied 3.7% with the firm said to be considering IPO its Asian biz which could reap $5B.
Construction names closed mixed despite a rosier outlook from Bank of America ML. The broker sees infrastructure names as appealing on a defensive standpoint while upgrading homebuilders. On that they like the building material space with better margins seen in cement names. UK builders were upped on a view a no-deal Brexit will likely be avoided. LafargeHolcim +1.4%, Saint-Gobain -2.4%, Ferrovial -.4%, Taylor Wimpey +4.8%, and Persimmon +4.4%.
Debenhams continued lower, down another 19%, after their Chairman and the CEO’s board seat were nixed by shareholders.
From earlier: Daimler -.8%, VW -1.9%, BMW -1%, and Renault -2.2%.
Trade data out of China is due early next week with expectations of slowing growth in Exports on a Dollar basis. EU Industrial Production is due Monday as well. Hopefully next Tuesday we will see a vote in the UK Parliament pertaining to Brexit.