📆 Wednesday, April 30
► European shares rose despite rather mixed earnings, as investors were confronted with a large number of earnings reports and awaited important economic data from the USA. The Stoxx 600 rose by 0.4%, the German DAX by 0.6% and the French CAC slightly by 0.5%. UBS gained 0.2% after beating estimates with revenue of $12.56 billion, while Barclays fell 1.5% despite strong Q1 numbers and an upgraded FY25 outlook. Mercedes-Benz (-2.1%) reported revenue of €33.2bn (-7.4% y-o-y) and GAAP EPS of €1.74 and warned that continued tariff uncertainty could significantly impact FY guidance. Volkswagen (-0.5%) also pointed to downside risks to profit and cash flow as its Q1 profit fell 40%. Despite these warnings, European auto stocks held relatively steady after President Trump signed an executive order easing the imposition of tariffs on foreign vehicles and parts. German GDP contracted by 0.2% YoY, while France grew by 0.8% thanks to unexpectedly strong household demand. Overall, the economic data for the Eurozone is rather better than expected, with German data still lagging behind. Eurozone GDP growth was reported at +1.2% YoY (compared to 1.0% expected).
► US futures fell slightly (for now) after a six-day rally, with contracts on the S&P 500 and Nasdaq 100 slipping into negative territory. The pullback came ahead of key US GDP and PCE inflation data, which are seen as crucial for interest rate cut expectations. The yield on 10-year Treasuries stabilized at 4.165%. Sentiment on corporate earnings turned after Snap (-13.5%) slumped in after-hours trading, refusing to provide forward guidance because of macroeconomic headwinds. Super Micro Computer fell more than 16.5% after the company missed its preliminary targets and Starbucks (-7%) reported a slightly larger-than-expected decline in revenue. General Motors and JetBlue withdrew their full-year forecasts, while UPS announced plans to cut 20,000 jobs this year (all the previous day). Analysts expect the Magnificent Seven to report average earnings growth of 15% this year, with Microsoft and Meta reporting later today and Apple and Amazon reporting later this week.
► Asian markets closed mostly higher despite weak economic data, especially from China. The official manufacturing PMI fell to 49.0, the sharpest decline since December 2023, while the services PMI also fell short of expectations. The Shanghai Composite fell 0.23%, while Shenzhen rose 0.51%. Weak factory data and subdued consumer spending weighed on sentiment and the offshore CNY fell for a second day as trade tensions persisted. Japan's Nikkei gained 0.57% when markets reopened, supported by trade dialog between the US and Japan. Australia's ASX rose for the fifth consecutive session, closing up 0.34% after inflation remained at 2.4% in the first quarter.
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