Trader Talk: An Analysis of the Markets this Morning

Good morning,

Markets are called to open flat this morning.

Royal Dutch Shell Plc

Royal Dutch Shell Plc, Europe’s biggest oil company, said fourth-quarter earnings will fall “significantly” because of weaker refining, higher exploration costs and lower-than-expected production volumes.

Adjusted profit excluding one-time items and inventory changes will be about $2.9 billion, The Hague-based Shell said in a statement. That compares with $4.5 billion in the third quarter and a fourth-quarter estimate of $4.9 billion, according to the average of seven analysts surveyed by Bloomberg.

Chief Executive Officer Ben van Beurden, who took over from Peter Voser at the start of the year, is facing rising costs for new projects, stagnant oil prices and falling output as he tries to boost earnings. Shell is lagging behind its peers, climbing 3.4 percent since the start of 2013 compared with a 15 percent advance for BP Plc and Exxon Mobil Corp.’s 14 percent gain.

WHAT TO WATCH:

China Investment Corp. to Invest EU70m in Irish Fund: Times

• Fiat Heir Elkann Reshapes Family Legacy With Chrysler Deal

• Ardian Said to Seek Bids Next Month for $1.6b Diana Sale

• KKR, Permira Selling 16.6% Stake in Broadcaster ProSiebenSat.1

• Spain Approaches Swap Deal With Ceiss Investors: Official

• Hapag-Lloyd Said to Discuss All-Stock Takeover of Chile’s CSAV

• J&J-Bayer Fail to Win U.S. Panel Vote for Wider Xarelto Use

• Nokia Search for Elop’s Successor Is Said to Focus on Insiders

• Alstom Said to Name Bank of America, Deutsche Bank for Rail Sale

• Regeneron Says Bayer Barred From Buying More Than 20% Stake

• Telecom Italia to Create Controls on Eventual Brazilian Deals

• Deutsche Telekom, Orange Puts EE Listing Plan on Hold: FT

• UBS Said to Boost Bonuses for Asia Investment Bankers by 10%

• Boeing Short-Circuiting 787 Shows Skills Gap: Norwegian Air

• Poland Has Met 65% of 2014 Forex Borrowing Needs After USD Bond

• Jordan Says Franc Cap Will Be SNB Focus for Foreseeable Future

EARNINGS All times CET:

• Spectris (SXS LN) 8am, Q4 sales/trading

• William Hill (WMH LN) 8am, Q4 sales/trading

Good day and happy trading!

Kristian Camenzuli