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European Markets Fall; Musk vs. Apple

Investors watched unrest in China as protests against stringent Covid restrictions and lockdowns flared over the weekend, and European markets ended the day lower. Most industries and significant bourses also ended the day in the red. 

By market close, the pan-European Stoxx 600 was down 0.7%. The oil and gas stocks also went down, leading to a 1.4% decline.

While a national government policy adjustment earlier this month had encouraged hopes of a gradual relaxation, the upheaval coincided with an increase in infections, which prompted stronger local Covid controls. Regulations have slowed the economy down for almost three years. The youth unemployment rate is about 20%.

STOXX Europe 600

STOXX Europe 600

Amid the instability in China, Hong Kong equities lead losses in Asia. Concerns over demand from the second-largest oil consumer in the world kept oil futures around new 2022 lows.

Retailers in Europe worry that this year’s holiday season will be the worst in at least 10 years as consumers struggle to make ends meet due to rising inflation and skyrocketing energy costs.

“The energy situation is evident in the Christmas industry. According to HDE retailers’ association General Manager Stefan Genth, shops are experiencing uncertainties for consumers, with inner-city retailers still feeling the effects of Covid.

Investors worry that eurozone equities may underperform other markets in the coming months. The energy crisis, has been made worse by the conflict in Ukraine. The fact that the European Central Bank is progressively raising interest rates to combat pricing pressures across the bloc is also a factor that makes the region’s economy appear particularly vulnerable.

Tuesday Earnings Release

This week, investors will also be digesting a new round of earnings reports, with Hewlett Packard Enterprise leading tech reports after the bell and the Canada GDP data, which will be released on Tuesday.

Hewlett Packard Enterprise Company

Hewlett Packard Enterprise Company is an American multinational company, also known as HP Enterprise and HPE, focusing on business IT (information technology). Following close of market, Hewlett Packard Enterprise Company is anticipated to announce earnings. The report will cover the accounting quarter that ends in October 2022. 

According to analysts, the consensus EPS expectation for the quarter is $0.39. For the same quarter a year ago, the reported EPS was $1.91. 

Intuit Inc.

Intuit is a global digital platform that assists consumers and small companies with their most pressing financial issues. Following the closing of the market, Intuit Inc. is anticipated to announce earnings. 

The report will cover the accounting quarter that ends in October 2022. The consensus EPS expectation for the quarter is $0.08 based on projections from analysts. For the same quarter the previous year, there was a reported EPS of $0.91. 

Bank of Nova Scotia (The)

Before the market opens, the Bank of Nova Scotia (The) is anticipated to release earnings. The report will cover the accounting quarter that ends in October 2022. The consensus EPS expectation for the quarter is $1.49 and is based on analysts’ predictions. For the same quarter a year ago, the reported EPS was $1.66. 

Workday, Inc.

Workday (NYSE: WDAY) offers integrated cloud applications for student/faculty lifecycle management, human resources, and finance that are tailored to the way people operate in modern organizations.

Following the closing of the market, Workday, Inc. is anticipated to announce earnings. The report will cover the accounting quarter that ends in October 2022. Zacks Investment Research reports that the consensus EPS prediction for the quarter is $-0.15, based on projections from 17 analysts. For the same quarter the previous year, there were no reported EPS. 

CrowdStrike Holdings, Inc.

CrowdStrike Holdings, Inc. is slated to announce earnings after the market close. The report will cover the fiscal quarter that ends in October 2022. Based on expert forecasts, the consensus EPS projection for the quarter is $-0.23. Last year, the reported EPS for the same quarter was $-0.19. 

Canada Third Quarter GDP Data

Elsewhere this morning, Statistics Canada will publish its most recent estimate of economic growth. The federal agency is expected to present third-quarter and September gross domestic product data.

According to a preliminary estimate from Statistics Canada, the third quarter’s economy expanded by 0.4%. In comparison, the second quarter of this year had an increase of 0.8%.

Residential investment and other business investment likely decreased in the third quarter as a result of the deteriorating economic outlook, according to a client note from RBC. In the fourth quarter and until 2023, higher interest rates from the Bank of Canada are anticipated to further stifle economic development.

Elon Musk Now Intends to Compete with Apple

The Twitter founder posted on Monday that Apple threatened to remove his social media program from the App Store, effectively killing one of Twitter’s primary distribution channels. Apple did not respond to Musk’s assertions. 

Despite his rhetoric about free speech and repression, Musk’s biggest beef with Apple is likely to be about money rather than expression. The billionaire also criticized Apple’s strategy requiring app developers to pay a 15% to 30% cut on digital items sold through their apps. 

Musk wants to charge subscription fees for certain Twitter services in order to generate money for the company now that ad dollars have dried up.

Disclaimer

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Author

  • Zahari Rangelov

    Zahari Rangelov is an experienced professional Forex trader and trading mentor with knowledge in technical and fundamental analysis, medium-term trading strategies, risk management and diversification. He has been involved in the foreign exchange markets since 2005, when he opened his first live account in 2007. Currently, Zahari is the Head of Sales & Business Development at TraderFactor's London branch. He provides lectures during webinars and seminars for traders on topics such as; Psychology of market participants’ moods, Investments & speculation with different financial instruments and Automated Expert Advisors & signal providers. Zahari’s success lies in his application of research-backed techniques and practices that have helped him become a successful forex trader, a mentor to many traders, and a respected authority figure within the trading community.

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