Foreign Stock Roundup: Bank Of Montreal Q4 Earnings Decline, Rio Tinto Lowers '17 Capital Spending Target

Investors in Europe remained focused on Brexit negotiations and the Senate’s decision to approve a new tax Bill last week. Meanwhile, encouraging economic data led to gains for Asia’s markets. Investors in Brazil remain concerned about the fate of crucial pension reforms. Meanwhile, Chile’s investors remained worried about the outcome of upcoming presidential elections.

Brexit Negotiations, Economic Data Guide Europe’s Stocks

Stocks across Europe finished in the green last Monday after the U.S. Senate approved a new tax legislation by a narrow margin over the weekend. The STOXX 600 gained 0.9% with nearly all prominent exchanges and sectors closing the day with gains. Materials and construction stocks were the leading gaining for the day, adding almost 1.6%. The region’s auto stocks, which have significant U.S. exposure, gained 1.6%.

The STOXX 600 lost 0.2% on last Tuesday even as investors focused on Brexit negotiations and economic reports. Basic resources stocks were the major losers for the day, declining by 1.4% following heavy losses on the metals bourses. Retail stocks gained 0.8%, emerging as the leading gainer for the day. Meanwhile, Eurozone’s composite PMI for October hit its highest monthly level in six and a half years.

Global losses for tech stocks led Europe’s bourses to close on last Wednesday with minor losses. The STOXX 600 declined by 0.1% with major sectors ending mixed. Most major exchanges closed in the red but the FTSE 100 rebounded from early losses to end the day 0.3% higher. Auto and bank stocks were the worst losers for the day, dropping nearly 1%.

The STOXX 600 swung between gains and losses on last Thursday, ultimately ending the day 0.02% higher. Major sectors ended mixed as investors digested mergers and acquisitions news and awaited crucial economic data. Telecom stocks advanced by 1.3%. Shares of banks added 0.9% while travel and leisure stocks finished in the green.

Europe’s stocks ended Friday with gains, buoyed by progress on Brexit negotiations and a long awaited agreement on global banking regulations. The STOXX 600 gained almost 0.8% with nearly all major sectors finishing in the green. Banks were the day’s leading gainers, gaining more than 2% after Basel III deadlock was finally resolved.

Nikkei Rebounds from Mid-week Losses, Economic Data Positive

Stocks across Asia closed mixed last Monday even as the U.S. Senate approved a new tax legislation by a narrow margin over the weekend. Australia’s ASX 200 lost 0.6% while the Nikkei and the Topix each declined by 0.5%. However, South Korea’s Kospi gained 1.1% Stocks in China swung between gains and losses. The Shanghai Composite and the Shenzhen Composite declined by 0.2% and 0.7%, respectively.

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Asia’s markets closed lower on last Tuesday. Australia’s central bank refrained from raising interest rates, a move that was largely in line with expectations. The ASX 200 declined by 0.2% even as financials lost 0.5%. The Nikkei lost 0.4% while the Topix added 0.2%. The Kospi also moved higher, advancing by 0.3%. The Shanghai Composite and the Shenzhen Composite declined by 0.2% and 1.9%, respectively.

The Nikkei lost almost 2% last Wednesday as nearly all of Asia’s markets suffered sharp declines. These declines came after the S&P 500 experienced its first three-day losing streak since August. Meanwhile the Topix declined by 1.4%. The ASX 200 and the Kospi lost 0.4% and 1.4%, respectively. China’s stocks recouped part of their early losses to end mixed. The Shanghai Composite declined by 0.3% while the Shenzhen Composite added 0.7%.

Stocks across Asia closed mixed last Thursday even as the Nikkei 225 recouped early losses partly to advance 1.5%. Stocks of automakers, technology companies and traders also closed higher. The Kospi lost 0.5% while the S&P/ASX 200 added 0.5%. However, the Shanghai Composite and Shenzhen Composite declined by 0.7% and 0.6%, respectively.

Encouraging economic data helped Asia’s stocks close with gains last Friday. The Nikkei gained 1.4% even as Japan’s third quarter GDP was revised upward from 1.4% to 2.5%. The Kospi and the S&P/ASX 200 added 0.1% and 0.3%, respectively. Growth in China’s exports and imports for November exceeded expectations. The Shanghai Composite and the Shenzhen Composite gaining 0.6% and 1.2%, respectively.

Mexico’s Markets Remain Volatile, Pension Reform Woes Weigh on Bovespa

Brazil’s stocks moved higher last Monday after Chinese authorities mandated reductions in production of steel. This tightened supply levels for several mill products, boosting shares of Vale SA (NYSE:VALE) . Shares of Vale gained 2.5%, making the largest points wise contribution to the Bovespa which increased 0.6%.

On last Tuesday, Mexico’s benchmark S&P/BVM IPC share index rebounded, increasing 0.6% after its plunged to its lowest point since March a week before. The Bovespa lost 0.7% following lingering uncertainty over the fate of attempts to modify Brazil’s social security system. Meanwhile, Chile’s IPSA index declined 1.8% as investors remained worried about the outcome of upcoming presidential elections.

The S&P/BVM IPC share index declined by 1% last Wednesday following portfolio rebalancing actions on news that leading bank Banorte was buying a smaller competitor. The Bovespa added 1% even as the government scrambled to find support among lawmakers for its pension reform push.

However, the Bovespa lost 2% last Thursday after the Temer administration failed to cobble together sufficient support among legislators to push through its pension reforms. On last Friday, the S&P/BMV IPC gained 1.2%, rebounding after trading at lows not witnessed since February over two straight sessions. The Bovespa gained 0.3% despite continuing uncertainty over president Temer’s ability to push through crucial pension reforms.

Stocks in the News

Bank of Montreal (TO:BMO) reported fourth-quarter fiscal 2017 (ended Oct 31, 2017) adjusted earnings per share (EPS) of $1.94, decreasing 7.6% year over year. Bank of Montreal has a Zacks Rank #3 (Hold).

Total revenues (on an adjusted basis), net of insurance claims, commissions and changes in policy benefit liabilities (CCPB), amounted to C$5.1 billion ($4.1 billion), down 2.3% year over year. Concurrently, the company announced quarterly dividend per share of 93 cents, increasing 3% from the prior payout. (Read: Original post

Written By: Zacks Investment Research