Results weak, outlook bleak More companies have missed estimates than have beaten them Earnings results in Europe have come in below expectations since companies started reporting two weeks ago. With 53 companies having reported so far (34% of the total number we expect to analyze), 28% of companies beat consensus by more than 5%, while 40% missed by the same margin. On an absolute basis, 49% beat consensus and 49% missed. Results have been better for larger stocks. Basic Resources and Telecoms have had the weakest results relative to expectations. Few sectors stand out on the positive side. There are significant shortcomings of the analysis of quarterly earnings in Europe. We include in our analysis firms in which at least two analysts had estimates in I/B/E/S on July 15 and expect to analyze 155 companies over the course of the earnings season. Estimates continue to come down Over the past month, both 2008 and 2009 estimates have been revised down 2.1%. Year-to-date, 2008 consensus estimates have fallen 9.3% and 2009 estimates have fallen 6.6%, and growth is now expected to be 1.6% this year and 12% in 2009. We believe that consensus estimates for 2008 and 2009 remain too high. Our top-down estimate is for an earnings fall of 6% in 2008 and a further fall of 5% in 2009. Weakness in Financials has been offset by strength in Oil & Gas, Basic Resources and Chemicals. The number of large negative surprises has dramatically increased The number of large negative revisions has spiked in recent months. Over the last month, over 70 companies have had consensus expectations revised down by more than 5%. Negative revisions have been quite broad as well: two-thirds of the index had 2009 estimates revised down in July. Results have been stronger in the US So far, 259 companies have reported 2Q results (62% of total cap). 49% of companies reporting have beaten estimates (above the historical average of 45%) and 14% have missed estimates (versus the average of 14%).
So in your opinion what is going to be the trend at this moment of Dax? Please let me know and thanks for the wonderful job you have done! Gul
US initial jobless claims came in better then expected. Look for a nice bounce in US markets until the release of unemployment figures at beginning of September....
Company outlook statements show management teams are concerned about a growth slowdown in the second half of the year. While emerging markets and pricing power have contributed positively to results, managements are still worried about commodity costs and currencies. Dividends and buybacks remain a focus of many companies. Management teams say... We reviewed the 2Q2008 earnings transcripts of the largest companies in each sector of the DJ Stoxx 600 to assess anecdotal evidence on the economic picture, pricing trends, cost pressures and major themes. Growth in developed markets is slowing down The majority of companies talked about an impending slowdown in world growth. The focus has shifted to Western Europe and, in particular, Spain. Some companies lowered guidance when they released results. But emerging markets remain positive contributors Emerging markets remain a key support for companies with regional diversification. Russia, Central/Eastern Europe and China were often cited as helping to offset weakness in the rest of the world. Commodity costs & currencies hurt results, but may reverse in 3Q Commodity cost pressures were extreme in the second quarter, and while some companies were able to increase prices, many still suffered from margin compression. A higher euro also hurt companies based on the continent. However, commodity prices have come down in recent weeks and European currencies have started to weaken. This may positively impact results in future quarters. Companies are committed to returning capital to shareholders Many companies remained committed to returning value to shareholders this quarter, in the form of both dividends and share buybacks. There appears to be little impact from the credit crunch on large-cap listed companiesâ ability to raise debt financing.
Hi, all. Does anybody know from experience, how many contracts of FDAX are tradable without slippage? TIA.
Credit concerns increase risk The recent events in the financial world have again highlighted the issue of credit quality across the whole market. Our banks team believes banks still need to reduce the overall size of their balance sheets, which will mean both reduced lending and higher rates for borrowers. We believe companies that can internally finance growth and operations should outperform. Recommend: Buy low leverage / Sell high leverage