European markets open to close US inflation data, earnings and news

Ocado shares drop after the sell notice due to cost-of-living pressures

Ocado vans in London on 21 January 2022.

Mike Kemp | In the pictures | Getty Images

UK food delivery company Ocado led early European equity losses after forecasting a small drop in sales for 2022 and “close to break even” gains.

The company slipped 13.05% in the first hour of trading. He said customers were choosing cheaper products and downsizing their baskets as the UK faces a steep rise in the cost of living and many workers return to the office.

“As a result, the average basket value fell 6% over the period, to £ 116, with a larger drop seen later in the quarter during the peak summer holiday season,” the company said in a statement.

“Despite positive customer growth, accelerating downward trading and smaller baskets, particularly in recent weeks, mean we now expect a small drop in sales in fiscal 22 and close to breakeven EBITDA.”

– Jenni Reid

Unemployment in the UK hits a 48-year low as real wages drop dramatically

Unemployment in the UK fell to 3.6% in the three months to July, the lowest level since 1974.

The economic inactivity rate, meanwhile, increased by 0.4 percentage points to a five-year high of 21.7%.

The National Statistical Office attributed the change to an increase in long-term sickness designations and students leaving the labor market. The growing rigidity of the labor market could fuel further inflationary pressure and cause headaches for the Bank of England.

Annual growth in real wages – taking inflation into account – net of bonuses fell by 2.8% in the three months to the end of July.

“People will understandably seek help from their employers during the cost-of-living crisis, while Andrew Bailey hopes companies don’t raise wages too quickly and inflate them,” said Marcus Brookes, chief investment officer at Quilter Investors.

“However, the UK needs to prepare for public sector discontent with wage strikes continuing as budgets are tight.”

– Elliott Smith

UBS plans to increase dividend; shares go up in pre-market

UBS Group plans to raise the dividend by 10% to $ 0.55 per share and expects its share buybacks in 2022 to exceed $ 5 billion, the Swiss bank said Tuesday.

UBS shares were indicated up 1.2% in pre-market activity after what ZKB analyst Michael Klien called surprise news.

Read more here.

– Reuters

Shares on the move: Futures up 5%, Ocado down 12%

Shares of Future Plc gained 5.5% at the start of trading leading the Stoxx 600 after the UK media company predicted full-year adjusted operating profit would come in the higher end of expectations for the year. market.

At the bottom of the European blue chip index, UK food tech firm Ocado plunged more than 12% after warning of a full-year drop in sales as consumers weathered the surge in inflation.

CNBC Pro: Forget Oil: Coal is hot right now. Here are 2 titles to play with, according to the pros

Coal mining in Wyoming.

Brian Brainerd | The Denver Post | Getty Images

Coal prices are at an all-time high and market watchers see prices rise again as a global energy crisis looms.

“It’s almost as if one or all of the companies are a purchase,” said booming coal industry analyst Peter O’Conner and reveals his favorite stock.

CNBC Pro subscribers can read more here.

—Zavier Ong

The relief rally is likely the bear market rebound, says Wells Fargo

According to Wells Fargo, the recent equity relief rally is likely another bear market rebound and investors should position themselves for more instability.

“The following year, the outperformance of defensive, high-payout, high-quality, low-valuation stocks reminds investors of the hallmark of a bear market,” Chao Ma wrote in a statement on Monday. global and investment strategist.

Such rallies occur in almost all bear markets and many are quickly reversed, leaving investors with regrets, they added.

“While it is difficult to predict the bottom of a bear market, in the past, market lows were typically preconditioned by overly pessimistic market sentiment and a sign of definitive improvement in the underlying economic or market problem,” said Ma. “We believe that we have not yet arrived in either aspect “.

Meanwhile, Ma advises investors to look for defensive stocks with low volatility, high dividends, and stock buyback yields. He also says that investors should choose high-quality names with profitability, leading market share and affordable market price.

—Carmen Reinicke

US stock futures are up ahead of Tuesday’s CPI report

US stock futures rose Monday night as Wall Street watches the August Consumer Price Index report to be released Tuesday morning. The report will provide investors with an update on the inflation situation in the US and is one of the latest data the Federal Reserve will see ahead of its September meeting.

The Dow Jones Industrial Average futures gained 55 points, or 0.17%. S&P 500 and Nasdaq 100 futures were up 0.18% and 0.21% respectively.

—Carmen Reinicke

CNBC Pro: Do ​​you want to invest in real estate? These REITs are a favorite of analysts

Real estate investment funds, or REITs, are making a comeback after a volatile year for many asset classes.

Analysts from Morgan Stanley and Citi highlight REITs from two sectors that they believe could outperform the broader market and remain resilient in a recession.

CNBC Pro subscribers can read more here.

– Weizhen Tan

European markets: here are the opening calls

European equities are expected to open cautiously on Wednesday with the UK’s FTSE index seeing 18 points higher at 7,560, Germany’s DAX 33 points higher to 13,944, France’s CAC 40 up 18 points to 6,616 and the ‘Italian FTSE MIB up 42 points to 23,029, according to data from IG.

Data releases include preliminary euro zone unemployment data for the second quarter and gross domestic product for the second quarter. The latest UK inflation data for July and preliminary Dutch GDP for the second quarter will be released.

Earnings come from Uniper, Carlsberg, Persimmon, Balfour Beatty, BAT and National Grid.

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