by Pauline Foret

(Reuters) – European stock markets ended lower on Tuesday, reversing the morning trend, as investors prepare for three intense days of financial publications under the sign of “megacaps”, large-cap companies across the Atlantic.

In Paris, the CAC 40 ended down 0.61% at 7,511.11 points. The British Footsie for its part lost 0.80% and the German Dax 0.27%.

The EuroStoxx 50 index fell by 0.40%, the FTSEurofirst 300 and the Stoxx 600 by 0.57%.

The session was marked by the release of a flurry of results from companies including Adidas, Lufthansa, Santander and BP.

The British oil giant, which disappointed expectations in the third quarter and fell on the London Stock Exchange, dragged the European energy sector into its fall, thus weighing on all indices.

Now, markets have their eyes on the results of “megacaps”, or large-cap companies in the US market, which should give a clearer direction to global indices, put under pressure by the imminent arrival of the US elections. Alphabet will open the show this evening, and will be followed by Meta and Microsoft on Wednesday.

“It would not be surprising to see short-term de-risking and turbulent trading at the moment ahead of Tuesday’s election,” said Michael Brown, senior research strategist at Pepperstone.

VALUES

In terms of values, BP lost 5.11% after reporting its lowest profit in four years.

Novartis fell 3.87% although the Swiss pharmaceutical group raised its annual outlook for the third time this year.

Lufthansa lost 5.3% after reporting a 9% drop in turnover in the third quarter.

HSBC gains 3.19% after beating expectations in the third quarter.

A WALL STREET

Across the Atlantic, the main indices are moving in scattered order as investors await the results of Alphabet, the first of the five “Magnificent Seven” to publish its results this week.

The Dow Jones lost 0.23%, while the Standard & Poor’s 500 gained 0.1% and the Nasdaq Composite advanced 0.53%.

On the stock side, Ford lost 9.05% after lowering its annual profit outlook.

DR Horton loses 8.55% after disappointing expectations in the fourth quarter.

Alphabet climbs 1% before the publication of its quarterly results.

TODAY’S INDICATORS

Across the Atlantic, the Labor Department’s highly anticipated “Jolts” (Job Openings and Labor Turnover Survey) report showed a faster-than-expected drop in job openings, indicating a softening of the labor market in the world’s largest economy.

In September, 7.44 million jobs were created, while analysts polled by Reuters expected a figure of 8 million.

CHANGES

The dollar strengthens against the Yen against a backdrop of political uncertainty in Japan, where the ruling coalition lost the parliamentary majority in last weekend’s elections, but moves little against other currencies, investors being cautious in the waiting for the American elections and a slew of economic indicators expected this week.

The greenback gained 0.07% against a basket of reference currencies.

The euro lost 0.11% to 1.0800 dollars.

The pound sterling, for its part, is asserting itself while awaiting the British budget and advances by 0.23% against the dollar and by 0.33% against the euro.

RATE

Driven by the uncertainty surrounding the American presidential elections one week before a vote which promises to be very close, bond yields continue to soar.

The ten-year Treasuries yield gained 4.4 basis points to 4.3224%, the two-year treasuries gained 1.2 basis points to 4.1517%.

The ten-year German Bund yield follows the trend, gaining 4.8 basis points to 2.3330% and the two-year 4.0 basis points to 2.1700%.

OIL

Oil prices continued their tumble on Tuesday after losing 6% the day before, reacting to reports that Israeli President Benjamin Netanyahu will organize a meeting to find a diplomatic solution to the war in Lebanon.

Brent fell 0.59% to $71.00 per barrel and American light crude (West Texas Intermediate, WTI) fell 0.56% to $67.00.

TO BE CONTINUED ON WEDNESDAY:

Many economic indicators are expected during the day on Wednesday, including the first estimate of GDP in the third quarter, household consumption expenditure on goods and producer prices in France, unemployment figures, GDP and inflation in Germany, as well as industrial production and the business climate in the Eurozone.

In terms of corporate results, two of the “Magnificent Seven” are expected across the Atlantic, Meta and Microsoft, as well as Eli Lilly and Kraft Heinz.

In Europe, other results from large companies are expected, such as French banks, TotalEnergies and Volkswagen.

(Some data may have a slight lag)

(Written by Pauline Foret, edited by Augustin Turpin)

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