Europe Factors to Watch-Shares set to rise after surprise BoJ easing

viernes 31 de octubre de 2014 03:28 GYT
 

PARIS, Oct 31 (Reuters) - European stocks were set to rally on Friday after
the Bank of Japan stunned global financial markets by easing policy further,
sending Tokyo's Nikkei index surging 4.8 percent.
    At 0723 GMT, futures for Euro STOXX 50, for UK's FTSE 100,
for Germany's DAX and for France's CAC were up 1.5-2.4 percent.
    The Bank of Japan will increase the pace at which it expands base money to
about 80 trillion yen per year, up from a previous target of 60-70 trillion yen.
    The BOJ also decided to increase its purchases of government debt by about
30 trillion yen and extend the average duration of JGB holdings to around 10
years, and decided to triple its purchases of exchange-traded funds and Japan
real estate investment trusts. 
    Also boosting equity markets, sources told Reuters a Japanese government
panel overseeing the Government Pension Investment Fund (GPIF) approved plans
for the fund to raise its holding of domestic stocks to 25 percent of its
portfolio from a current 12 percent. 
    "While we may have seen the end of the Federal Reserve's bond buying
programme for the time being and the ECB reluctant to step into the breach, it
appears that the Bank of Japan has no such qualms, filling the void left by the
US central bank as overnight they surprised the markets with the announcement of
a fresh bout of monetary stimulus," Michael Hewson, chief market analyst at CMC
Markets, said in a note.
    Banking stocks will be in focus after BNP Paribas, France's No. 1
bank, said third-quarter net income rose 11 percent from a year ago as gains in
fixed income trading and in international retail offset a lacklustre economic
environment in its core European markets. 
    Anheuser-Busch InBev will also be in the spotlight after the
world's largest beer maker reported a lower-than-expected increase of earnings
in the third quarter as U.S. wholesalers cut inventories and Brazil was stagnant
after the soccer World Cup. 
    So far in Europe's earnings season, 36 percent of companies have reported
results, of which 67 percent managed to meet or beat profit forecasts, and 59
percent met or beat revenue forecasts, according to Thomson Reuters StarMine
data. In absolute terms, profits are up 7.1 percent, while revenues are up 0.1
percent, highlighting the fact that Europe's earnings rebound has mostly been
coming from cost-cutting and lower financing costs.
       
    Europe bourses in 2014: (link.reuters.com/pad95v)
    Asset performance in 2014: (link.reuters.com/rav46v)
------------------------------------------------------------------------------
  MARKET SNAPSHOT AT 0717 GMT: 
                                         LAST   PCT CHG  NET CHG
 S&P 500                             1,994.65    0.62 %    12.35
 NIKKEI                              16413.76    4.83 %   755.56
 MSCI ASIA EX-JP                       485.03    0.71 %     3.41
 EUR/USD                               1.2557   -0.44 %  -0.0055
 USD/JPY                               111.31    1.93 %   2.1100
 10-YR US TSY YLD                       2.348        --     0.04
 10-YR BUND YLD                         0.864        --     0.01
 SPOT GOLD                          $1,171.40   -2.27 %  -$27.24
 US CRUDE                              $81.02   -0.12 %    -0.10
 
  > GLOBAL MARKETS-JAPAN SHARES UP AS BOJ STUNS WITH MORE MEASURES 
  > US STOCKS-WALL ST UP ON GDP, EARNINGS; FUND YEAR-END LIFTS WINNERS 
  > NIKKEI CLOSES AT HIGHEST SINCE 2007 AS BOJ UNEXPECTEDLY EASES 
  > TREASURIES-PRICES INCH UP BUT OFF PEAKS ON JAPAN EQUITY BUYS REPORT 
  > FOREX-YEN SLIDES TO 7-YEAR LOW AFTER BOJ SURPRISES WITH MORE EASING 
  > GOLD LANGUISHES BELOW $1,200; SILVER TUMBLES TO 4-1/2 YEAR LOW 
  > METALS-LONDON COPPER STEADY, SET TO POST SMALL MONTHLY GAIN 
  > BRENT FALLS BELOW $86, HEADS FOR WORST MONTH SINCE 2012 
    
    COMPANY NEWS:
    
    BNP PARIBAS 
    France's No. 1 bank, said third-quarter net income rose 11 percent from a
year ago as gains in fixed income trading and in international retail offset a
lacklustre economic environment in its core European markets. 
    
    ANHEUSER-BUSCH INBEV 
    The world's largest beer maker reported a lower-than-expected increase of
earnings in the third quarter as U.S. wholesalers cut inventories and Brazil was
stagnant after the soccer World Cup. 
    
    NOKIAN RENKAAT 
    Finnish tyre maker Nokian Renkaat reported quarterly profit below market
expectations and said its full-year operating profit could end up 22 percent
lower from the previous year due to weak sales in Russia. 
    
    DANONE 
    Danone will buy a 25 percent stake in China's Yashili International Holdings
Ltd for $550 million, gaining an additional route into the booming
Chinese market for infant milk formula. 
    
    RIO TINTO 
    Rio Tinto Plc looked set to take a $2.5 billion writedown on its huge but
troubled copper project in Mongolia, the Times reported, after construction of
the $5 billion Oyu Tolgoi became caught up in a tax dispute with the government.
    
    ROYAL BANK OF SCOTLAND 
    RBS said it had set aside 400 million pounds ($639 million) to cover
potential fines for manipulating currency markets and another 100 million pounds
to compensate customers mis-sold loan insurance. 
    
    WPP 
    WPP posted a lower-than-expected 3 percent rise in third-quarter
like-for-like net sales on Friday and said it expected the fourth quarter to
slow from the rate recorded in the first nine months. 
    
    INTERNATIONAL AIRLINES GROUP 
    The group reported a 30 percent jump in third-quarter profit and upgraded
its forecast for the year, reassuring investors after the British
Airways-owner's strike-hit rivals cut their guidance. 
    
    MONTE DEI PASCHI DI SIENA 
    Moody's said on Thursday it might cut the credit ratings of the Tuscan
lender after pan-European health checks unveiled capital shortfalls for the
bank. 
    
    EUTELSAT 
    The satellite operator said it was targeting full-year organic revenue
growth of 4 percent after fiscal first-quarter revenue rose 4.21 percent to
357.6 million euros. 
        
    ATLANTIA 
    France will cancel a multi-million-euro contract with a consortium led by
the Italian group after scrapping the "ecotax" road toll the consortium was to
collect, a junior minister said on Thursday. Atlantia, which owns 70 percent of
Ecomouv, reacted by saying that the contract safeguards its investments.
 
    
    FERROVIAL 
    Spanish infrastructure group Ferrovial late on Thursday said its earnings
before interest, depreciation and amortisation (Ebitda) rose 11 percent to 701
million euros (884 million US dollar) in the first nine months of the year,
compared to 2013. 
    

 (Reporting by Blaise Robinson)