📆 Thursday, October 26
► European markets followed the bearish sentiment, with the European Stoxx 600 recording a decline of over 0.6%. We also see Germany's DAX hitting its lowest since January, down over 1.3%. We traded the recent downturn with the DAX extremely well. All eyes are on the European Central Bank's policy decision as it is projected to maintain interest rates after over a year of consistent hikes. It is likely that ECB President Christine Lagarde is sending signals that interest rates have peaked.
► On the earnings front, we see very poor earnings reports from several European companies. Unilever saw a 2.7% dip as Q3 sales growth missed estimates. Automotive manufacturer Mercedes-Benz reported a 6% loss, affected by inflationary pressures and a drop in car prices. Standard Chartered also faced a 12% drop, with Q3 profits not meeting expectations due to China-related investments. US pharma giant Merck beat expectations with strong sales from cancer treatment Keytruda – just as we have predicted.
► US equities face pressure due to disappointing earnings from companies like Alphabet, which had an extending a selloff on Wednesday due disappointing cloud figures. On the other hand we see Meta coming in with a positive earnings report but also warning about a potential earnings slowdown given economic uncertainties. Futures on Thursday indicated a continuation of these losses. We await the release of earnings from Amazon and Intel later today. We also look closely on how Amazon performed in Q3 as it will give more insight to the current state of consumer spending.
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