Market Outlook November 15th - November 19th

Market Outlook

- WALL STREET:
In the US, equity indices declined 2.20% in average, last week. On the economic front, most of releases were better than expected. However, some blue ship results falling short of expectations darkened the short term outlook. Indeed, University of Michigan Confidence rose to 69.3 (69 expected) from 67.7 in October and Weekly jobless claims fell to 435k (450k expected) from 459k. However, Cisco Systems plummeted after its current quarter forecasts fell short of expectations. As a consequence, technology hardware was the worst performing sectors, with an almost 5% weekly decline, followed shortly by real estate. On the opposite, energy stocks were the only ones ending the week in the positive territory, in average. Technically, the S&P 500 outlook remains bullish with 1240 in sight.

- EUROPE:
In the UK, the FTSE 100 declined 1.34% last week. On the economic front, September industrial production rose 3.8% YoY (+3.6% expected) vs 4.3% in August (revised higher from +4.2%). However, manufacturing production rose only 4.8% YoY (4.9% expected) vs 6% in August and October Nationwide Consumer confidence unexpectedly declined to 52 from 53 (expected unchanged). From a technical point of view, the daily RSI supported by a rising trend line maintains a bullish bias with 5960 and 6038 as next up targets. In the rest of Europe, the CAC 40 declined the most with a 2.19% weekly loss whereas, the DAX eased only 0.29%. Regarding economic releases, Euro-Zone 3Q GDP rose 1.9% YoY, in line with expectations. However, German September industrial production unexpectedly dropped 0.8% MoM (+0.4% expected) vs +1.5% in August (revised lower from +1.7%). All European sectors ended the week in the red except, automobile gaining 2%, basic resources and retail. On the opposite, chemicals stocks declined the most with a 2.25% loss. Technically, on the Stoxx 600, the outlook remains bullish above 260, even so a limited consolidation cannot be ruled out. Next up targets are set at 275 and 280.

Company preview

British Land (GBp 503 ; -2.9% ; BLND ; BLND.L)
On Tuesday, British Land is expected to deliver 1H pre-tax profit of £107m compared to a loss before tax of £113m a year earlier. Recently, the Co teamed up with Oxford Properties Group to construct the Cheesegrater tower in London. The Co's price target was raised to 550p vs 500p with a "buy" rating unchanged at UBS. Technically, the stock is now very close to its key support at 490p. A test should be in sight before any further upsides to 525p.

Wal-Mart (USD 54.13 ; -1.94% ; WMT ; WMT.N)
The same day in the US, Wal-Mart Stores could publish 3Q EPS of $0.9 compared to $0.84 a year ago on sales of $102.4bln vs $99.4bln. Earlier, the Co may bid for Matahari's hypermarket operations worth $1bln in Indonesia, according to Reuters' report. Early this month, the Co announced to offer free shipping on appx. 60,000 online items. From a technical view, the stock retraced back to its 50D MA last week, but is still supported by an upside trend line. Above $53, look for a further rise to $56 at first.

Air France-KLM (EUR 13.15 ; -3.45% ; AF ; AIRF.PA)
Wednesday, Air France-KLM may deliver 2Q net profit of E200m compared to a loss of E147m last year on sales of E6.3bln vs E5.6bln. A week ago, the Co won a 10yr component support contract for 35 of Malaysian Airline System's fleet of B737-800 aircraft. Earlier, the group fined appx. E340m by the European Commission in respect of anti-competitive practices in its cargo business relating mainly to the period between May 2004 and February 2006. Graphically, the stock broke below its 20D MA's support last Friday and is now expected to test its 50D MA (around E12.1) on the downside in the forthcoming days.

Target (USD 54.19 ; -1.74% ; TGT ; TGT.N)
On the same day , Target, the US general merchandise discount stores operator, is expected to release 3Q EPS of $0.68 compared to $0.58 last year on sales of $15.6bln vs $15.3bln. Recently, the Co reported October net retail sales of around $4.6bln, an increase of 2.2% YoY with comparable-store sales up 1.7%, near the low end of its expectations. From a technical point of view, the stock price currently consolidates above a MT ascending trend line. A re-test of $56 is more likely to occur in the short term, if breakout, aims at $58.

 SABMiller (GBp 2022 ; -0.44% ; SAB ; SAB.L)
On Thursday, SABMiller may post 1H pre-tax profit of $1.8bln compared to $1.5bln last year. Last month, the Co announced 1H beer sales up 1%, excluding the effect of acquisitions, beating the +0.5% consensus. Recently, the Co's venture, MillerCoors released 3Q underlying net income, excluding special items, up 36.7% YoY to $334m. Technically, the shares might be shaping "H&S pattern" with the neckline at 1980p. The downside breakout of this level should validate this bearish reversal configuration with targets at 1900p and 1860p.

Selection of those events which may affect the stock prices of international Large Caps

Corporate Calendar November 15th - November 19th

Economic Calendar (CET) November 15th - November 19th