Bulletin
Investor Alert

April 30, 2019, 5:59 a.m. EDT

Glencore shrinks production estimates, sinking Europe markets

new
Watchlist Relevance
LEARN MORE

Want to see how this story relates to your watchlist?

Just add items to create a watchlist now:

  • X
    STOXX Europe 600 Index (SXXP)
  • X
    FTSE 100 Index (UKX)
  • X
    British Pound (GBPUSD)

or Cancel Already have a watchlist? Log In

By Dave Morris


AFP/Getty Images
An aerial view taken on September 22, 2015 in Voh, in North Province, New Caledonia shows the Koniambo Nickel SAS (KNS) metallurgical plant belonging to Glencore and Societe miniere du Sud Pacifique. / AFP / THEO ROUBY (Photo credit should read THEO ROUBY/AFP/Getty Images)

Mega-miner Glencore PLC’s cuts to its production guidance sank European markets Tuesday, dragging down fellow miners in the process.

How did markets perform?

The Stoxx 600 /zigman2/quotes/210599654/delayed XX:SXXP -2.90%  was down 0.1% to 390.8, giving back Monday’s 0.1% gain.

The U.K.’s FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX -3.83%  retreated 0.3% to 7,422.2 after posting a 0.2% gain Monday.

The pound /zigman2/quotes/210561263/realtime/sampled GBPUSD +0.1375%  was up 0.3% to $1.2974. It had ticked down 0.1% Monday.

France’s CAC 40 /zigman2/quotes/210597958/delayed FR:PX1 -4.30%  had also gained 0.2% Monday. On Tuesday, it fell back 0.4% to 5,560.

In Germany, the DAX /zigman2/quotes/210597999/delayed DX:DAX -3.94%   /zigman2/quotes/210223310/lastsale DAX -4.83%  was down 0.1% to 12,315.2 reversing Monday’s 0.1% climb.

Italy’s FTSE MIB /zigman2/quotes/210598024/delayed IT:I945 -2.97%  was flat at 21,789, cementing its 0.2% move upward on Monday.

The euro /zigman2/quotes/210561242/realtime/sampled EURUSD -0.1368%  was 0.1% higher at $1.1199 after ending Monday flat.

What’s moving the markets?

Just when China bulls were starting to feel encouraged, manufacturing Purchasing Manager Index (PMI) survey data produced a significant miss, coming in at 50.2 versus 50.7 expected. The note from Caixin indicated that “relatively subdued demand” left companies reluctant to add to inventories.

Silvia Dall’Angelo, senior economist at Hermes Investment Management, wrote in a note: “The recent slowdown is likely indicative of a much broader structural change in the Chinese economy, as it transitions to a more mature phase.” Dall’Angelo pointed out that China’s economy isn’t just a domestic issue but one that affects nations that trade heavily with the country, particularly Germany: “Over the last two decades, [Germany] has successfully capitalized on China’s rapid growth model by exporting its specialty goods – cars and machinery.”

In other economic data, French preliminary GDP growth figures were in line with expectations at 0.3%. German ILO unemployment figures were slightly better than expected at 3.2%, with 13,000 fewer people unemployed than the prior year. German consumer confidence came in slightly above consensus at 10.4 versus 10.3.

Which stocks are active?

Earnings dominated the news for individual companies. Miners bore the brunt of the declines as Glencore PLC gave its first quarter production report and reduced its full-year guidance for a number of key commodities. Its shares /zigman2/quotes/201400686/delayed UK:GLEN -3.75%  were down 3%, while fellow miners Rio Tinto PLC /zigman2/quotes/202627887/lastsale RIO -3.05% , BHP Group PLC /zigman2/quotes/208108397/lastsale BHP -2.23%  and Anglo American PLC /zigman2/quotes/201381512/delayed UK:AAL -7.16%  were down 1.6%, 1.3% and 1.3%, respectively.

Shares of Danish lender Danske Bank A.S. /zigman2/quotes/209678580/delayed DK:DANSKE -3.75%  dropped 7.2%, as profits fell in the first quarter. The lender also announced lawsuits stemming from the money laundering investigation into its Estonian branch.

Banco Santander S.A. shares /zigman2/quotes/205677933/delayed ES:SAN -3.22%  were down 0.6% following the Spanish giant’s first quarter earnings which showed that profits fell in its home market as well as in the U.K.

The U.K.’s Standard Chartered PLC /zigman2/quotes/200125072/delayed UK:STAN -7.27%  turned in pretax underlying profits of $1.38 billion for the first quarter, up 10% year over year. The bank announced a $1 billion share buyback, sending the stock up 5.1%, and CEO Bill Winters said he expected to produce “full year returns of at least 10%” by 2021.

Russ Mould, investment director at AJ Bell, said: “In theory, the company should be able to generate better growth than its UK-listed peers as it benefits from an increasing number of people in developing economies accessing banking services.”

Airplane maker Airbus SE saw a sharp year over year increase in first quarter adjusted profit thanks to more vehicle deliveries, which produced a 24% increase in sales to €12.6 billion. The company is set to become the world’s largest jetliner maker later this year, while the current titleholder and rival Boeing is mired in software problems with its 737 Max line. Shares /zigman2/quotes/208224336/delayed FR:AIR -12.03%  were down 0.8%.

/zigman2/quotes/210599654/delayed
XX : STOXX
310.77
-9.29 -2.90%
Volume: 0.00
April 1, 2020 5:50p
loading...
/zigman2/quotes/210598409/delayed
UK : FTSE UK
5,454.57
-217.39 -3.83%
Volume: 1.62M
April 1, 2020 4:57p
loading...
/zigman2/quotes/210561263/realtime/sampled
US : Tullett Prebon
1.2383
+0.0017 +0.1375%
Volume: 0.0000
April 1, 2020 8:04p
loading...
/zigman2/quotes/210597958/delayed
FR : France: Euronext Paris
4,207.24
-188.88 -4.30%
Volume: 141,856
April 1, 2020 6:05p
loading...
/zigman2/quotes/210597999/delayed
DAX
DX : Xetra Indices
9,544.75
-391.09 -3.94%
Volume: 132,862
April 1, 2020 6:30p
loading...
/zigman2/quotes/210223310/lastsale
US : U.S.: Nasdaq
$ 19.60
-0.99 -4.83%
Volume: 7,641
April 1, 2020 4:15p
loading...
/zigman2/quotes/210598024/delayed
IT : Borsa Italiana
16,544.97
-505.97 -2.97%
Volume: 0.00
April 1, 2020 5:36p
loading...
/zigman2/quotes/210561242/realtime/sampled
US : Tullett Prebon
1.0949
-0.0015 -0.1368%
Volume: 0.0000
April 1, 2020 8:04p
loading...
/zigman2/quotes/201400686/delayed
UK : U.K.: London
119.16 p
-4.64 -3.75%
Volume: 41.40M
April 1, 2020 4:35p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
£16.33 billion
Rev. per Employee
£1.04M
loading...
/zigman2/quotes/202627887/lastsale
US : U.S.: NYSE
$ 44.17
-1.39 -3.05%
Volume: 3.91M
April 1, 2020 6:30p
P/E Ratio
9.02
Dividend Yield
8.65%
Market Cap
$57.16 billion
Rev. per Employee
$852,406
loading...
/zigman2/quotes/208108397/lastsale
US : U.S.: NYSE
$ 35.87
-0.82 -2.23%
Volume: 3.71M
April 1, 2020 6:30p
P/E Ratio
9.65
Dividend Yield
7.97%
Market Cap
$54.02 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/201381512/delayed
UK : U.K.: London
1,315.00 p
-101.40 -7.16%
Volume: 4.09M
April 1, 2020 4:35p
P/E Ratio
6.08
Dividend Yield
6.71%
Market Cap
£17.36 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/209678580/delayed
DK : Denmark: OMX
kr. 74.02
-2.88 -3.75%
Volume: 3.62M
April 1, 2020 4:59p
P/E Ratio
4.43
Dividend Yield
11.48%
Market Cap
kr.65.65 billion
Rev. per Employee
kr.4.43M
loading...
/zigman2/quotes/205677933/delayed
ES : Spain: Madrid
2.15
-0.07 -3.22%
Volume: 74.59M
April 1, 2020 5:38p
P/E Ratio
5.94
Dividend Yield
8.68%
Market Cap
€36.84 billion
Rev. per Employee
€374,762
loading...
/zigman2/quotes/200125072/delayed
UK : U.K.: London
413.40 p
-32.40 -7.27%
Volume: 9.64M
April 1, 2020 4:35p
P/E Ratio
9.41
Dividend Yield
5.28%
Market Cap
£14.07 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/208224336/delayed
FR : France: Euronext Paris
52.20
-7.14 -12.03%
Volume: 5.47M
April 1, 2020 5:37p
P/E Ratio
N/A
Dividend Yield
3.16%
Market Cap
€46.42 billion
Rev. per Employee
€476,596
loading...

Get news alerts on British Pound and Euro — or create your own.
This Story has 0 Comments
Be the first to comment
More News In
Markets

Story Conversation

Commenting FAQs »
Link to MarketWatch's Slice.