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European stock markets closed on red amid investors’ caution

The Wall Street markets are closed today due to the Thanksgiving day, but the European stocks ended Thursday trading session on red

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The Wall Street markets are closed today due to the Thanksgiving day, but the European stocks ended Thursday trading session on red, as investors remained cautious in the context of Brexit and Italy’s budget for next year.

The pan-European Stoxx 600 index declined by 0.65%, with all leading indicators in Europe registering losses. The UK blue chip index FTSE 100 wiped out 1.28% of its value. The German DAX 30 decreased by 0.94%, while the French CAC 40 index moved down by 0.75%.

DAX 30

The Travel & Leisure sector was the only winner in the session, growing by 0.32%. The raw material sector was the weakest with a decline of 1.55%.

What influenced the markets today?

Three days after Carlos Ghosn’s arrest in Japan, the board of directors of Japanese manufacturer Nissan voted to sack him. This has created serious uncertainty about the future of the 19-year reunification between the Japanese company and Renault.

Earlier in the day it became clear that the UK and the European Union had agreed on the principle framework of the their bilateral relations after Brexit. The agreement now has to be approved by the leaders of the European countries at the upcoming summit this Sunday. The transition period after Brexit could be extended for a period of “one or two years”, according to the agreement. The text adds that both sides are determined to find a better and lasting alternative to the so called Irish safeguard mechanism that prevents the establishment of a hard border in Northern Ireland.

Meanwhile, Italy’s budget continues to cause headaches for Europe. With Italy’s reluctance to give up its big spending plans for 2019, the European Commission announced on Wednesday that it is taking disciplinary action against the country. The shares of Italian banks declined after Deputy Prime Minister Matteo Salvini said the government would not change its budget for next year.

Corporate reports

The French beverage producer Remy Cointreau reported sales of sales of 571.4 million EUR in Q3 2018, representing a growth of 5.0% YoY. The company’s current operating profit amounted to 138.0 million EUR, up 2.9% on a reported basis. In organic terms, current operating profit was up 10.1%, thanks to a significant rise in the gross margin (up 0.9 point). These effects comfortably offset significantly higher investment in communication (up 9.5%) and continued efforts to strengthen distribution structures. The current operating margin of Remy Cointreau reached 24.1%, up 0.6 point on an organic basis.

Cellcom Israel announces revenues of 910 million NIS (251 million USD) in Q3 2018, representing a decrease of 6.7%. The company’s operating income totaled 33 million NIS (9 million USD), while the net income totaled 1 million NIS (0.3 million USD) and the EBITDA totaled 184 million NIS (51 million USD).

The Canadian investor in pipeline systems Macro Enterprises reported consolidated revenue in Q3 2018 of 41.6 million USD. However, quarter over quarter, the company saw a significant uptick in construction revenue relating to the commencement of the North Montney Mainline pipeline project along with a larger facilities construction job that also started during the quarter. About 75% or 31.0 million USD of the revenue earned related to pipeline and facilities construction with the balance relating to maintenance and integrity services work being performed under existing master service agreements.

The Canadian company Cordy Oilfield Services reported growth in consolidated revenues for the first nine months of the year by 3.9 million USD, or 46%. The company’s normalized operating earnings increased by 0.5 million USD, or 39%, from the comparative period.