OTP Morning Brief: European new car sales continued to rise
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OTP Morning Brief: The S&P pulled back from its record high on Friday, but ended the week in positive territory
European stocks closed slightly lower on Friday, snapping a four-week winning streak. The BUX presented a much more positive picture in terms of its weekly performance. The eurozone economy expanded by 0.4% quarter-on-quarter in Q2, supported by Spain’s outstanding performance. Major US indices also closed lower on Friday, but the week was largely positive overall. Investor sentiment continued to be weighed down by uncertainty in the Middle East and elevated oil prices. US Treasury yields rose and the dollar weakened following weaker-than-expected retail sales data. Japan's Q2 GDP growth fell short of expectations, while Asian equity markets moved higher. August purchasing managers' indices are due for release this week.
OTP Morning Brief: US rate cut expectations declined further despite the favorable producer price index data
The favorable July producer price index data led to a further decline in US rate cut expectations on Thursday. Markets are now pricing in a Fed rate cut only in December. Declining rate cut expectations provided a boost to US equities, with the technology-heavy Nasdaq posting the strongest gains among the major indices. Sandisk shares surged 13.7%. In Europe, major stock indices moved only modestly, with the STOXX 600 remaining broadly flat. The favorable US CPI data led to a decline in developed market government bond yields. Today, the second estimate of eurozone Q2 GDP is due for release, while additional July retail sales data will be published in the US.
Western European indices closed mixed as uncertainty over the Iran conflict persists, while new car sales in the EU continued to rise.US indices mostly moved higher; Tuesday’s momentum in semiconductor stocks eased somewhat; Meta shares rose. Developed market long-term yields barely moved, while Hungarian yields fell; there was no clear direction in regional FX markets. Today brings the European Commission’s economic sentiment index and the minutes of the ECB’s latest rate-setting meeting. In the US, releases include CPI, GDP, housing, household consumption and income, as well as order book data. Hungary will publish unemployment figures.
Western European indices closed mixed as uncertainty over the Iran conflict persists, while European new car sales continued to rise
Western European equity markets closed mixed on Wednesday, as investors assessed military developments in the Middle East and declining oil prices. Market sentiment continued to be shaped by the evolution of the Iran conflict. Earlier in the week, progress in peace talks was reported, however tensions intensified after US forces—according to their statement acting in self-defense—carried out strikes in southern Iran against missile launch positions and naval units.
On the corporate front, AkzoNobel’s share price saw a significant surge, rising nearly 19.5% after the company rejected a joint takeover bid from Nippon Paint and Sherwin-Williams, and reiterated its support for a planned merger with Axalta. The automotive sector also delivered strong performance, supported by expanding new car sales in the EU: new passenger car registrations rose 5.1% year-on-year in April, marking the third consecutive monthly increase, although moderating from March’s 12.5%. Growth continues to be driven by strong demand for electric and other electrified vehicles, further reinforced by tax incentives and subsidy schemes across major European markets. The share of fully electric cars climbed to 19.7% of total sales in the first four months of the year, up from 15.3% a year earlier. The four largest markets showed a mixed picture: sales increased in Germany (+2.7%), Italy (+11.6%), and Spain (+8.4%), while France recorded a slight 0.3% decline. Overall, the EU new car market grew by 4.2% in the first four months of the year despite ongoing geopolitical tensions.
Regional indices declined yesterday, with the exception of the BUX: among domestic blue chips, only MOL shares fell, while the other three stocks moved higher.
US indices mostly moved higher; Tuesday’s momentum in semiconductor stocks eased somewhat; Meta shares rose
US equity markets mostly moved higher on Wednesday with modest moves, as momentum in semiconductor stocks eased. The Dow Jones was supported by a notable decline in oil prices, following reports from Iranian state media that the country is committed to a swift restoration of commercial traffic through the Strait of Hormuz. However, the White House dismissed the report as unfounded.
Within the technology sector, semiconductor manufacturers delivered mixed performance. Micron shares—following Tuesday’s more than 19% surge—closed with a more moderate gain of around 3.6%, while Intel and Qualcomm declined by 1.4% and 6.2%, respectively. In recent periods, memory chipmakers have become key beneficiaries of rising demand for artificial intelligence, although some market participants have pointed to stretched valuations and risks stemming from the sector’s cyclical nature. JPMorgan shares fell 2.4% after the CEO signaled that the bank could spend up to $20 billion on acquisitions in the coming years. Meta shares rose 3.7% following reports that the company plans to introduce subscription-based services across its Meta AI chatbot as well as Facebook, Instagram, and WhatsApp.
Developed market long-term yields barely moved, while Hungarian yields declined; regional FX markets lacked a clear direction
Despite conflicting reports on peace talks between Iran and the US, confidence in global capital markets strengthened further regarding a swift agreement. Oil prices declined by an additional 5%, with Brent crude falling to around $94 per barrel. No significant macroeconomic data were released. Bond and FX markets in developed economies reacted only modestly, with yields barely moving; the 10-year US Treasury yield closed at 4.5%, while the German equivalent ended below 3%. The EURUSD pair also showed little change from Tuesday’s 1.163 level.
There was no clear direction in regional FX markets yesterday: the Czech koruna weakened, the zloty traded sideways, while the forint strengthened to around 354.5 against the euro. In bond markets, the communication from the MNB’s rate-setting meeting—released after Tuesday’s benchmark fixing—triggered a decline in yields, with the segment of the curve beyond one year falling by 5–10 basis points, effectively flattening around the 5.4% level in the government bond market.
Today, the Government Debt Management Agency (ÁKK) will offer 3-, 5-, and 10-year fixed-rate bonds at auctions, with announced volumes of HUF 20bn, HUF 20bn, and HUF 25bn, respectively.
Today's highlights
Asian indices were in decline this morning, while oil prices rose again after US forces once more struck targets in Iran deemed to threaten their security, prompting Iran to retaliate by targeting US air bases.
Today, the European Commission will release its economic sentiment index, alongside the minutes of the ECB’s latest rate-setting meeting. In the US, CPI, GDP, housing data, as well as household consumption and income figures will be published, along with durable goods orders and the usual Thursday initial jobless claims. Hungary will release unemployment data.
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