Trader Talk: An Analysis of the Markets this Morning

Good morning,

Markets are called to open lower this morning. This is what's happening today:

• Alexion Said to Pick Goldman to Advise After Roche Overture

• Asian Stocks Pare Loss Before Fed Policy Meeting

• Volkswagen Profit Beats Estimates as Lower Costs Counter Europe’s Slump

• BMW Rejected in China Seen Signals Dimming Outlook for Foreign Companies

• IVG Immobilien Examining If Positive Forecast Can Be Upheld

• Liechtenstein Bank to Pay $23.8m in U.S. Tax Case

• CSN Is ‘Only Hope’ for ThyssenKrupp Americas Unit, DiMicco Says

• Saipem CEO Says Petrobras May Take New Bids for Pipeline

• U.K. Lawmakers Urge Corporate-Tax Review to Tackle Avoidance

EARNINGS: all times CET, estimates where available

• Obrascon Huarte Lain (OHL SM) pre-mkt, 1H, no est.

• Snam (SRG IM) pre-mkt, 1H, no est.

• Grifols (GRF SM) pre-mkt, 1H GAAP EPS est: EU0.52 (2 ests.)

• BBVA (BBVA SM) pre-mkt, 2Q adj. EPS est: EU0.11 (2 ests.)

• Endesa (ELE SM) pre-mkt, 1H, no est.

• BNP Paribas (BNP FP) 7:00am, 2Q adj. EPS est: EU1.17

• HeidelbergCement (HEI GR) 7:00am, 2Q adj. EPS est: EU1.14

• UCB (UCB BB) 7:00am, 1H adj. EPS est: EU0.90

• AB InBev (ABI BB) 7:00am, 2Q adj. EPS est: $1.04

• Morphosys (MOR GR) 7:00am, 2Q adj. EPS est: EU0.39 (3 ests.)

• EADS (EAD FP) 7:00am, 1H GAAP EPS est: EU0.88

• Dufry (DUFN SW) 7:00am, 2Q GAAP EPS est: CHF0.83 (3 ests.)

• Pohjola Bank (POH1S FH) 7:00am, 2Q adj. EPS est: EU0.22 (3 ests.)

• Vontobel (VONN SW) 8:00am, 1H adj. EPS est: CHF1.21 (1 est.)

• Peugeot (UG FP) 7:30am, 1H adj. loss/shr est: EU1.84

• Schneider Electric (SU FP) 7:30am, 1H adj. EPS est: EU1.74 (2 ests.)

• Bayer (BAYN GR) 7:30am, 2Q adj. EPS est: EU1.46

• Solvay (SOLB BB) 7:30am, 2Q adj. EPS est: EU1.10

• Hugo Boss (BOSS GR) 7:30am, 2Q adj. EPS est: EU0.75

• Red Electrica (REE SM) 7:30am, no est.

• Suez Environnement (SEV FP) 7:30am, 1H, no est.

• Diageo (DGE LN) 8:00am, FY adj. EPS est: GBP1.02

• Wolters Kluwer (WKL NA) 8:00am, 1H adj. EPS est: EU0.66

• Verbund (VER AV) 8:00am, 2Q adj. EPS est: EU1.07 (1 est.)

• Centrica (CNA LN) 8:00am, 1H adj. EPS est: GBP0.14

• Outotec (OTE1V FH) 8:00am, 2Q adj. EPS est: EU0.20

• Rightmove (RMV LN) 8:00am, 1H adj. EPS est: GBP0.37 (2 ests.)

• Smurfit Kappa (SKG ID) 8:00am, 2Q adj. EPS est: EU0.28 (1 est.)

• Segro (SGRO LN) 8:00am, 1H adj. EPS est: GBP0.09 (3 ests.)

• St James’s Place (STJ LN) 8:00am, 1H adj. EPS est: GBP 0.13 (1 est.)

• Taylor Wimpey (TW/ LN) 8:00am, 1H adj. EPS est: GBP0.03 (2 ests.)

• Tullow Oil (TLW LN) 8:00am, 1H adj. EPS est: $0.25 (3 ests.)

• British American Tobacco (BATS LN) 8:00am, 1H adj. EPS est: GBP1.10

• Moneysupermarket.com Group (MONY LN) 8:00am, 1H adj. EPS est: GBP0.05 (1 est.)

• Genel Energy (GENL LN) 8:00am, 1H, no est.

• Antofagasta (ANTO LN) 8:00am, 2Q production report

• Vedanta Resources (VED LN) 8:00am, 1Q production

• Millennium & Copthorne (MLC LN) 8:00am, 1H, no ests.

• WS Atkins (ATK LN) 8:00am, 1Q IMS

• Tecnicas Reunidas (TRE SM) 9:00am, 2Q adj. EPS est: EU0.66

• Jeronimo Martins (JMT PL) 9:15am, 2Q adj. EPS est: EU0.14

• Fiat Industrial (FI IM) 12:00pm, 2Q, no est.

• Enel Green Power (EGPW IM) 5:00pm, 1H, no est.

• Colruyt (COLR BB) 5:45pm, 1Q, no ests.

• Finmeccanica (FNC IM) Aft-mkt, 1H adj. EPS est: EU0.08 (2 ests.)

• Parmalat (PLT IM) aft-mkt, 1H, no est.

• Autogrill (AGL IM) 1H, no est.

• Sacyr Vallehermoso (SYV SM) 1H, no est.

Asian shares fell as losses in Japan and India overwhelmed a China rally. European stock futures dropped and the dollar held gains against major peers before the Federal Reserve meets today. India’s rupee slid as metals rose.

The MSCI Asia Pacific Index of regional equities lost 0.9 percent by 7:17 a.m. in London, trimming the first monthly advance since April to 1.7 percent. India’s S&P BSE Sensex fell 0.8 percent and Japan’s Topix Index slipped 1.5 percent while the Shanghai Composite Index rose 0.3 percent. Euro Stoxx 50 Index futures lost 0.2 percent, while Standard & Poor’s 500 Index contracts were little changed. The rupee declined 1 percent to near a record as Malaysia’s ringgit headed for the

weakest close since 2010. Gold climbed 0.6 percent.

The Fed has indicated its $85 billion monthly bond purchases could be trimmed should the U.S. economy meet its forecasts, though Chairman Ben S. Bernanke has said there’s no fixed schedule for tapering stimulus. The government may say today that gross domestic product growth slowed last quarter, while employment data are also scheduled this week. Chinese President Xi Jinping pledged to stabilize growth while pursuing reforms, the official Xinhua News Agency said yesterday.

“The market will pore through every word in that statement,” Bob Van Munster, head of Australian equities at Tyndall Investment Management Ltd. in Sydney, which oversees about $21 billion, said by phone, referring to the Fed’s post-meeting announcement. “The overall message is we are coming to an end of quantitative easing but we are going to manage it according to the data that comes out.”

Good day and happy trading!

Kristian Camenzuli