So we start August very much in the same way as we finished July. Banks earnings disappointing, tech saving the market and macro data going to dictate how we get along in what could be a bumpy month. Economic data finally bringing some hope to the table after having had disappointing GDP data last week. We had Eurozone PMI data out this morning and it beat estimates across the board.  Spanish 53.5 (vs cons 52.3), Italian 51.9 (vs 51.2), French 52.4 (vs 52.0) and German 51.0 (vs 50.0) –  Eurozone 51.8 (vs 51.1). The only exception was the UK with only a minor miss (53.3 vs 53.6). Worth pointing out (and slightly concerning) that the manufacturing employment keeps falling. Companies continue to operate below capacity and nearly all countries reported job cuts in the sector. We have Services and Composite PMIs out on Wednesday so let’s see if the data beats estimates as well.

Quieter day today as the market tries to figure out what to do after those big tech beats overnight. Thank god for those or we would be seeing another sea of red today! One incredible stat that our charts team pointed out is Apple’s cash pile is now big enough to be the 29th biggest stock in the S&P 500! The FTSE and the IBEX have been testing their support levels throughout the morning (6000 and 7000 respectively) so let’s see if they manage to close above. Vols pretty poor across the board (despite being month end) but it will be interesting to see what happens once the US opens. Nasdaq will undoubtedly be in the spotlight – a down day today would be a worry short term.

A deluge of earnings, a wave of beats but a sea of red today as macro concerns dominate. Spanish inflation set the tone as July harmonised MoM CPI decreased to -1.6% (vs est -1% and +0.4% previously). Our economist noting this suggests that in spite of ECB efforts and the EU Recovery Fund, the fundamentals of the euro structure mean outright deflation taking hold in the Eurozone periphery is a very real risk. Germany GDP data out shortly after and it didn’t help much (-10.1% QoQ). Note that Germany is not even particularly tied to discretionary services (imagine how other economies will do). Elsewhere we had EZ economic sentiment moving in the right direction this month but we continue to think that the real issue is the consumer side of things (especially unemployment). Over in the US, Initial jobless claims rose for a second week (1434k vs 1416k previously). GDP data not good either as the economy contracted -32.9% YoY (biggest drop on record). Imagine when unemployment numbers start to really go up.

A much more lively day after having had a couple of slow days. Earnings the obvious driver but our analysts also bombarding us with their previews for upcoming results (please shout if you are looking for one specifically).  Volumes also more encouraging with EU indices trading +17% above their 1day AVAT. Across the pond, Facebook, Amazon, Apple and Google all due to report tomorrow so investors will definitely have their eyes on the sector (including Microsoft – the 5 stocks now account for 22% of S&P 500 market cap). We also have the FOMC announcing its rate decision at 19:00 BST and as history tells us, FOMC days are usually up days. Powell’s record is not as clear as Bernanke’s and Yellen’s so let’s see how today’s session ends. Probably mixed once again…ES1 currently +0.2%, VGA -0.2%.

A calmer day after the last couple of sessions. EU equities opening solidly but drifting lower as the session progressed. Worries over the virus obviously still at the back of investors’ minds and despite having a morning full of earnings, it doesn’t feel as busy as it should. We are seeing lower volumes across the board and all indices are still trading below their 20d AVATs. Even gold is (finally) having a down day.

Not a great start to the week after hearing the new EU travel restrictions. News over the weekend confirmed that the UK has imposed a 14-day quarantine from those coming from Spain (amid a surge of covid cases in the country). This has probably ruined some holiday plans and we would expect, worries over a second wave of the virus in Europe are back on the table. US/China tensions also not contributing to the cause as unsurprisingly they continue to escalate. Aside from that, we have some exciting days ahead so let’s see what this week’s earnings have to bring us.  

Well its been coming right? Markets have been ignoring the macro tensions but the reality is that deep down, we all knew China wasn’t going to stay quiet for long. The US had been threatening China for many days now and China retaliated with the same stone (they ordered the US to close their consulate in Chengdu). Asia traded lower as a result (Hang Seng closed down 2.2% on high vols – +34% vs 20d AVAT) and European equities didn’t have any other choice other than to follow. All indices and sectors are down at least 1.2% (Oil & Gas the only exception up until recently –  helped by Equinor’s messy Q2 beat,  EQNR NO +4.5%) and we are seeing some conviction to the move with higher volumes across the board. Note the Stoxx 600 is heading for its first weekly decline in four (down -1.3% vs last Friday’s close) and somehow disappointing, the DAX is back trading below its psychological breakout point of 13000 (next support 12000, then11600).

Although it looks like todays earnings have slightly boosted EU equities throughout the morning, we should consider that it has actually been a quieter day overall. Volumes remain low across the board with not a single index trading above their AVAT. Feels like investors are taking a bit of a step back, mainly trading around numbers while leaving the macro tensions aside (for now). One thing to note is the Stoxx Growth/Value (STGP/STVP) –  growth made a new all-time relative high earlier today. Also keep an eye on the VIX, which has been ticking lower since yesterday – key support at 23.54.

I have been off for the past two days getting some Vitamin D! Seems I missed the EU Bill finally being signed and a few earnings but not much else. European equities pretty much flat vs Friday’s close with the Stoxx 600 currently +0.1% and the Stoxx 50 +0.3%. Germany still the clear outperformer (DAX up +1.5% vs Friday’s close, still holding above 13000 and it made a new all-time high vs SXXE again earlier today) and the UK remains the laggard (FTSE -1.2% Fri close too). We are seeing lower volumes across the board so hopefully tomorrow’s busy earnings session motivates investors a little more.

Oh my – what a roller coaster ride it’s been! We literally spoke about every possible scenario throughout the week and although EU equities are trading pretty much unch today, we are still set to finish the week just about up (SXXP +0.4). For the bulls out there, worth noting that the FTSE MIB made a new 3m rel high and managed to close above its June high yesterday. It is not quite yet through the June peak of 20399 but it is for sure getting close (last at 20358). The DAX is currently trading above its June highs of 12913, next resistance is at 13000. And for the bears, I will give you volumes. Despite seeing better vols than yesterday across the board we still do not have a single one trading above its 30 day AVAT. It remains very quiet. Elsewhere we have the EU summit kicking off today. Emmanuel Macron and Angela Merkel have both signalled that a deal is not likely until the end of the month so let’s see if that changes throughout the weekend.