Spreadex Market Update
Indecisive morning for European markets, whilst AB InBev shows frustration with SABMiller
As is the often elusive reasoning behind stock movements, Volkswagen and Deutsche Bank are up on the day despite both being mired in traditionally price-eroding situations. US VW chief Michael Horn’s testimony in front of the House of Representatives this afternoon, complete with the admission that he was aware of emissions-issues in early 2014, could, however, end up containing enough negativity that Volkswagen’s gains won’t be able to last until the end of the day. Deutsche Bank investors, meanwhile, appear to have been impressed by both the pre-tax profit figures lurking under that dark, $7 billion in losses-shaped cloud, and the frank, streamlining-aimed, assessment made by new(ish) co-CEO John Cryan. These VW/Deutsche Bank gains meant the DAX, in its best moments, could climb by around 40 points, even if the consistency of its growth was fairly erratic.
With the Bank of England rate vote still to come, the FTSE managed its own 30 point increase this morning, helped by an improving situation in its oil and mining stocks. The biggest news, however, arguably once again came from the drinks sector. Clearly frustrated with SABMiller’s insistence that the previous offers for the company have ‘very substantially’ undervalued its worth, Anheuser-Busch InBev, in a rather hostile act, has urged SAB’s shareholders to ‘voice their views’ if they want a merger to go ahead. The Belgian drinks behemoth is attempting to publically pressure the Santo Domingo family (who have a 14% stake in SAB) into accepting a deal that the Altria Group (the biggest SAB shareholder at 27%) has already emphatically put its weight behind.
In a somewhat ominous sign, the US futures are pointing to a 50 point drop for the Dow Jones at the open, a drop that could take with it the currently-directionless European markets. The state of the US open will likely be informed by this afternoon’s jobless claims, even if the expected 274k increase isn’t really strong enough to push investors one way or the other.
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