Morning Message

Tuesday Market Update

Tuesday 25th April 2017

European stocks were underpinned by deal-making and earnings this morning as focus shifted away from politics and back to fundamentals. The ESTX 50 (+0.10%), UK markets (+0.22%), Dax (+0.02%) and the CAC 40 (+0.11%) all posted gains in early trading. A win for centrist candidate Macron in the first round of the French presidential election sparked a global rally in risk assets as investors breathed a sigh of relief over the decreased chances of political upset. AMS surged +15.7% to a record high after reporting first quarter revenues above its own forecast and added that it may raise its mid-term revenue growth target. Volvo rose +7.7% after beating first quarter forecasts. Christian Dior jumped +12% to hit a fresh all-time high after a buyout deal.

US stocks rallied after centrist candidate and market favourite Emmanuel Macron won the first round of the French presidential election. The Dow Jones Industrial Average (+1.05%), S&P 500 (+1.08%) and the Nasdaq Composite (+1.24%) all increased. US investors were also gearing up for the busiest earnings week in at least a decade, with over 190 S&P 500 members, including Alphabet and Microsoft due to report results this week. Indexes were near their session highs after the Wall Street Journal reported tax cuts are more important for the White House than reducing the deficit, and President Trump looks to cut the corporate tax rate to 15% from 35%. C R Bard jumped almost 20% after US medical equipment supplier Becton Dickinson said it would buy Bard for $24 billion.

Asian sstocks gained after the first round of France’s presidential election stoked a global relief rally. The Nikkei 225 (+1.08%), Hang Seng (+1.31%) and the S&P/ASX 200 (+0.30%) all rallied. A nuclear powered US submarine made a port call in South Korea in a show of force, as the top nuclear envoys from South Korea, Japan and the United States were to meet in Tokyo to discuss responses to the North’s refusal to give up its nuclear programme. NEC rose +3.5% after raising its net and operating profit forecasts. Yamato Holdings jumped +5.5% after Nikkei reported that the transportation services group plans to raise base shipping rates for retail customers by 5% to 20% from September.

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