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European Markets Jump to Start 2022: Autos, Airplanes, Travel Lead the Way

by Daniel Shvartsman – European markets started 2022 continuing the momentum from a strong 2021, as indices jumped in early Monday trading.

At 1130 CET (915 GMT), the DAX (+.9%) , the Euro Stoxx 50 (.8%), the CAC 40 (1.1%), the IBEX 35 (.8%), and the FTSE MIB (1%) all traded higher. The U.K. markets and thus the FTSE 100 are closed for trading today in observance of New Year’s Day.

Leading sectors in early trading included the automobile sector, with Porsche Automobil Holding SE (DE:PSHG_p) (4.1%), Bayerische Motoren Werke AG (MI:BMW) (3.1%), Renault SA (PA:RENA) (2.8%), Volkswagen (DE:VOWG_p) (2.4%), Stellantis NV (PA:STLA) (1.5%), and auto parts supplier Michelin (PA:MICP) (1.9%) all driving higher to start the day. This comes amid Tesla (NASDAQ:TSLA) and other electric vehicle makers reporting their deliveries for Q4, as well as South Korean automaker Hyundai forecasting a 12.1% increase in auto sales in 2022.

The airplane industry jumped as well, with Safran (PA:SAF) (2.6%) announcing plans to hire up to 12,000 people in anticipation of air traffic recovering in 2022, with their CEO saying, “The worst is behind us.” Airbus is up 2.7% as well on the news. This may also be knocking on to the travel sector more generally, with International Consolidated Airlines Group S.A. (MC:ICAG) (5.5%), Aena (MC:AENA) (2.4%), Melia Hotels (MC:MEL) (3.9%), Air France KLM (PA:AIRF) (5%), and Deutsche Lufthansa AG (DE:LHAG) (6.5%) all among winners in early trading.

One more company in the news is Delivery Hero AG (DE:DHER), which announced last Friday it would be increasing its stake from 36% to 80% in Spanish-based delivery company Glovo. The German-based company, which just a couple weeks ago announced it would be shuttering its German efforts for the second time, is up 1.6% on the day. Rival Just Eat Takeaway (AS:TKWY) is trading up 2.4%.

CNH Industrial NV (MI:CNHI) is trading expectedly lower, down 11.5% after completing the spin-off of Iveco Group (MI:IVG) (though adjusted for the spin, CNH is up .6%). Iveco Group for its part is down 10.3% in its independent market debut.

European may be getting a tailwind from solid PMI (purchasing managers index) reports this morning, with the Eurozone report meeting expectations and showing a solid expansion with a 58 reading (50 and up is expansionary), and most individual countries’ reports coming in at or ahead of expectations; Germany came in slightly below expectations with a 57.4 reading vs. 57.9 expectations.

In line with the resurging demand theme, Brent Oil Futures are up 1.6%, while Crude Oil WTI Futures are up 1.4%. There have been questions asked anew over how much the Omicron variant of Covid-19 might weigh on demand and cause a glut in supply, but markets seem unconcerned so far.

Cryptocurrencies have had a muted start to the year, with Bitcoin slightly up for the year but down .1% in the last 24 hours, and Ethereum up 2.1%.

The EUR/USD is down .1% to 1.1355.

(Article will be updated throughout the day).


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