The Channel Tunnel Business Remains Highly Profitable.
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Investors are worried – what lies ahead for Brazil?
In a major surprise, Lula won the second round of Brazil’s presidential election, even though markets had previously expected Flávio Bolsonaro to prevail. Lula’s victory triggered a sharp repricing of Brazilian assets, while sentiment deteriorated further shortly afterwards following an unorthodox proposal calling for a substantial reduction in the central bank’s policy rate. For now, it appears that no such plan is under consideration in Brazil, and the president has reaffirmed his commitment to fiscal discipline. Investors, however, remain largely sceptical. Market participants are waiting for concrete measures, and in the near term the key question for Brazil will be whether the anticipated fiscal measures can stabilise the country’s debt trajectory and how the president will reconcile them with his campaign promises.
Hungary: Headline inflation accelerated in line with expectations, while underlying inflation pressures remained elevated
Hungary's headline inflation rose by 0.4 ppts to 2.0% year-on-year in October, up from 1.6% in September. The data was in line with the market consensus (2.0%) and marginally above our forecast (1.9%). The main reason for the acceleration of headline inflation was the further increase of fuel inflation while processed food prices decreased less than expected mainly due to sugar and confectionaries. However, food prices still significantly contributed to the low inflation in Hungary, so the fact that prices of several agricultural commodities have started to rise in recent months, reinforces our view that food prices will no longer contribute to disinflation in 2027.
Industrial stocks have started to outperform in recent days. Among them, we selected the French transportation and infrastructure company Getlink SE, which primarily operates the Channel Tunnel (Eurotunnel) beneath the English Channel, connecting France and the United Kingdom. Its chart is showing an upside breakout following an extended period of consolidation.
Best rated European stocks based on momentum ranking
Compelling technical picture:
Getlink SE (daily): From a technical standpoint, the stock appears to be breaking out to the upside after a prolonged accumulation phase. The risk level is well defined, as the price has rebounded from its lows along a clearly identifiable rising green trendline. The price target can be placed near the important natural resistance level around 21.88. A close below 18.75 would invalidate the bullish scenario, in which case exiting long positions would be advisable.
List of stocks with a chance of a turnaround in the coming weeks
Most popular European stocks
The momentum model supports the creation of a technical based stock list that helps to find shorter-term trading opportunities. The model can be used to identify stocks that show reversal signals following more sustained falls/underperformance. We examine one-year, six-month, three-month, one-month and five-day momentum values, which are used to rank the stocks under consideration. The higher a stock is ranked in the order, the better it technically performs relative to the others. The change in the ranking over time is used to determine the life cycle of the stock.
- In the first table, we collect the stocks that show the most attractive picture compared to the others in a given week based on momentum factors, of which those are also presented in a separate chart where a favourable situation can be identified based on additional technical analysis tools.
- In the second table, we list the stocks that are already worthy of being placed in watchlist status. They are not among the best performers, but they have the potential to improve and signal a turnaround in a few days or weeks.
- In the third table, we have also collected the more popular stocks to help identify their position in the momentum order.
The report shows the results of a technical - quantitative based stock screening, which does not examine the fundamental background/value of the companies. For this reason, risk management/position sizing rules should be designed accordingly.
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