Trader Talk: An Analysis of the Markets this Morning

Good morning,

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

• Telefonica Reviving German Merger With KPN Tests M&A Rule

• AstraZeneca Among Suitors Said to Be Preparing Bids for Onyx

• Asian Stocks Rise on Reduced Concern at Impact of Tapering

• RBS Proving Inferior at Less Than Break-Even Value Hurts Osborne

• IWH Forecasts East German Economy Will Stagnate This Year: BZ

• Sanofi to Roche Among Health Firms Linked to Agency in China Graft Probe

• Haniel Is Said to Hire JPMorgan to Explore Celesio Stake Sale

• Vivendi Starts Talks to Share SFR Mobile Network With Bouygues

• London Luxury Homes’ Average Value Climbs Above 2m Pounds

Companies in Europe reporting results today:

• Bolsas y Mercados Espanoles (BME SM) pre-mkt, no est.

• Sulzer (SUN VX) 7:00am, 1H adj. net est. CHF144.75m

• Telenor (TEL NO) 7:00am, 2Q GAAP EPS est. NOK2.24

• Gecina (GFC FP) 7:15am, 1H adj. EPS est. EU2.58 (3 ests.)

• Koninklijke KPN (KPN NA) 7:30am, 2Q adj. EPS est. EU0.05

• Dialog Semiconductor (DLG GR) 7:30am, 2Q adj. EPS est. EU0.08

• Trelleborg (TRELB SS) 7:45am, 2Q adj. EPS est. SEK2.004

• Croda International (CRDA LN) 8:00am, 1H adj. EPS est. GBP0.68 (2 ests.)

• Premier Foods (PFD LN) 8:00am, 1H, no est.

• PZ Cussons (PZC LN) 8:00am, FY adj. EPS est. GBP0.17

• IG Group Holdings (IGG LN) 8:00am, FY adj. EPS est. GBP0.38

• Petropavlovsk (POG LN) 8:00am, trading update

• Carpetright (CPR LN) 8:00am, 1Q IMS

• Beazley (BEZ LN) 8:00am, 1H adj. EPS est. $0.15 (3 ests)

• Provident Financial (PFG LN) 8:00am, 1H adj. EPS est. GBP0.42 (3 ests.)

• Sage Group (SGE LN) 8:00am, 3Q IMS

• Gas Natural (GAS SM) 9:00am, 1H, no est.

• Kemira (KRA1V FH) 1:30pm, 2Q adj. EPS est. EU0.20

• Metropole Television (MMT FP) Aft-mkt, 1H adj. EPS est. EU0.59

• Acerinox (ACX SM) 1H, no est.

• Enagas (ENG SM) 1H, no est.

• Gamesa (GAM SM) 1H, no est.

Asian stocks and European equity futures rose after China’s premier said the economy won’t grow any slower than 7 percent and U.S. housing data damped concern the Federal Reserve will rein in stimulus. New Zealand’s dollar strengthened, while Indonesia’s rupiah fell the most since 2011.

The MSCI Asia Pacific Index added 0.9 percent at 7:02 a.m. in London, headed for an eight-week high. Euro Stoxx 50 futures climbed 0.4 percent and contracts on the Standard & Poor’s 500 Index gained 0.3 percent, after the U.S. gauge rose to a record. The New Zealand dollar led gains among 16 major currencies, while the rupiah sank 1.9 percent versus the greenback. Silver lost 1.2 percent and natural gas futures rallied 0.6 percent.

Chinese Premier Li Keqiang said the slowest economic growth policy makers will tolerate is 7 percent, Beijing News reported today, citing comments at a recent meeting with economists and businesspeople. Sales of previously owned U.S. homes unexpectedly dropped 1.2 percent in June, data showed yesterday, bolstering the case for the Fed to keep stimulating the world’s biggest economy.

Good day and happy trading!

Kristian Camenzuli