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European stock markets recorded losses on Wednesday, while Wall Street has a break

European stocks

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European stock markets recorded losses on Wednesday, while Wall Street is closed today for a mourning day in memory of 41st country president George W. Bush, who died on November 30th at the age of 94. The New York Stock Exchange announced that it would cease trading on Wednesday to mark the national day of mourning.

However, European stocks are working and the pan-European index Stoxx 600 declined by 1%, with most sectors traded on a negative territory. All major exchanges were under pressure from investors, as the rising trade concerns have worsened market moods for global economic growth.

The British index FTSE 100 wiped out 1.44% of its value. On the stock exchange in France, the CAC 40 dropped by 1.36%, and the German index DAX 30 decreased by 1.19%.

FTSE 100

The focus of the markets was on the development of world trade amid growing doubts that the two largest economies in the world will be able to reach a full trade agreement while the temporary ceasefire lasts. Washington and Beijing announced a 90-day truce last weekend. However, there are concerns that the ceasefire may not continue. The US President Donald Trump threatened Tuesday to impose “big duties” on imports of Chinese goods if his administration does not reach a trade deal with Beijing.

Meanwhile, the Eurozone business activity is growing at the slowest pace in almost two years.

In Germany, the working hours reached a new record in Q3 2018, but the productivity is not in line with the increase in workload, warned the Federal Employment Agency.

Corporate performance

Shares of construction and commodity sector were among the worst performing on Wednesday, registering declines of more than 1.75% in the face of growing concerns about the trade war. The insurance sector also declined by 1.75%.

The French company Altran reported a decline in its stock price by 7.5% after releasing that the company’s director for North America, Frank Kern, will retire from his role as Chairman of Altran North America. Frank Kern has shaped and transformed Aricent from a telecom engineering services provider to a diversified company with a unique model and a strong team, defining services outsourcing across market segments and geographies.

The shares of the British pharmaceutical company Shire rose by 2.5% after the shareholders of the Japanese giant Takeda Pharmaceutical approved the acquisition worth 46 billion GBP (59 billion USD).

The London-listed building companies Berkeley Group, Persimmon, Bellway, and Barratt Development have posted an increase in their stock price of over 5% after Barclays analysts said they saw an opportunity to increase the stock price of banks and house builders if the deal for Brexit goes to parliament.

Earnings reports

The trading gives us a new portion of finance and earnings reports. In Q3 2018, 78% of S&P 500 companies have reported a positive EPS surprise and 61% have reported a positive sales surprise. During the first two months of the fourth quarter, analysts lowered earnings estimates for companies in the S&P 500 for the quarter. The Q4 bottom-up EPS estimate has dropped by 2.6%.

Nexeo Solutions, which connects customers with chemicals and plastics suppliers around the world, revenue growth of 11% in Q3 2018 to 1.02 billion USD, driven by specialty growth and disciplined price execution in an inflationary environment. The company’s net income for the year was 29.4 million USD or 0.38 USD per diluted share. Adjusted net income was 57.0 million USD or 0.74 USD per diluted share. For the whole year, the gross profit of Nexeo Solutions amounted to 460.1 million USD (+15.5% YoY), while EBITDA reached 209.0 million USD (+13.2%).

Net income of Laurentian Bank of Canada dropped by 13% YoY to 50.8 million CAD or 1.13 USD per diluted share during. The bank’s revenue for the quarter amounted to 255.86 million CAD.

National Bank of Canada hiked its dividend as it reported fourth-quarter net income of 566 million CAD, up by 8% from the previous year, as each of its three main business units improved earnings. The Montreal-based bank’s profit during the three months ended October 31 amounted to 1.52 CAD per share on a diluted basis and 1.53 CAD per share after adjustments.