Market Roundup: Is the EU a bed of roses 🌹 Facebook’s woes grow 😬

Table of Contents

1. EU want to stay in? UK. It’s not all a bed of roses

EU want to stay in? UK. It’s not all a bed of roses

While Britain’s parliament chases its own tail like a neurotic dog, and passers-by do their best to hold on to their cups of tea, let’s take a look across the Channel to see if the picture is any rosier.

Yesterday’s Eurozone industrial production report showed a gloomy picture, although stronger than expected, with output rising 1.4% month on month while still declining 1.1% year on year. This marginal increase on the month was driven by a rebound in some of the bloc’s bigger economies, such as Spain, Italy and France. However, of bigger concern, is that Europe’s industrial powerhouse, Germany, is still struggling to recover, with production numbers showing unexpected declines in January. Germany’s over dependency on exports, especially for automobiles, and its legacy engineering and technical advances (diesel), has left it trailing as emerging market disruptors take on the mantle of satisfying changing world demand.

Meanwhile, growing trade conflicts with the US and China just heighten its competitive uncertainty, with some experts even suggesting that Europe will account for less than a tenth of the world’s economy by 2050. That, and its members’ ever-growing debt crisis, is spooking investors who fear the crisis dominated Eurozone could even drag down the global economy.

In the shorter term, investors are still left with limited confidence in Europe and are twiddling their thumbs over a tradable outcome from the British parliament. After all, trade is a two-way thing. It’s not just the UK that could get hurt but, quite possibly, worse for Europe. Ouch!

2. Facebook’s woes grow

Facebook users around the world were hit by a 14-hour disruption on Wednesday as its main social network, its two messaging apps and image-sharing site Instagram, including Facebook Workplace, were all disrupted. Facebook still hasn’t been able to explain what was behind it all, adding to its long list of problems.

To add to its woes, at least two companies making smartphones and other devices were subpoenaed by a New York grand jury related to how they used Facebook user data, received under deals with the social networking company.

All this just goes to show that Facebook has a very long way to go to regain the trust of regulators and the public after two years of scandals related to privacy and security – and now outages.

Today we are watching…

1. DocuSign (#docu)

Q4 earnings are due after the market closes today. And every one is feeling pretty bullish about the e-signing digital transaction company.  Analysts are expecting a 12-month price target of $60.9. This represents a 6.34% upside over its previous closing price. The stock enjoyed an overall uptrend of 42.89% from the beginning of 2019. So it will probably be priced in through the course of today.

2. Dollar General (#dollarg)

With discount retailer, Dollar General, announcing its Q4 earnings before market opening, the consensus earnings estimate is $1.98 (+27.7% year on year). Consensus revenue estimate is $6.61B (+7.8% year on year). In the past couple of years, Dollar General has beaten earnings estimates 63% of the time and revenue estimates 50% of the time. Your call!

 

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