uploads///Trailing One Month FEZ Industrial Negative Performance

Factors behind Key Stock Performances in FEZ

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Oct. 23 2015, Published 8:46 a.m. ET

Factors driving stock performances

The trailing-one-month stock performances of the SPDR Euro Stoxx 50 ETF’s (FEZ) top three contributors were driven by the following factors:

  • SAP (SAP) rose by ~6% in last week’s trading session. In its preliminary 3Q15 result, the company announced an earnings of 0.98 euros, up 16% from 3Q14. Revenue has increased by 17%, to 5.0 billion euros on a year-over-year basis. Cloud computing was the major contributor toward the revenue increase, up by 116% to 600 million euros over the previous year.
  • Unilever (UN) rose by ~4.3% in the last week because of its strong volume growth in 3Q15. The company’s sales were up by ~5.7% and it had volume growth of ~4.1%. The high revenue growth was due to strong ice cream sales and high demand from emerging markets.
  • L’Oréal (LRLCY) rose by ~10% in the last month. The market is expecting high volume growth in 3Q15 compared to 2Q15. The personal care industry has given a weighted return of ~0.55% in the ETF.
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Underperforming industries in the last month

The industries that underperformed in the portfolio were food, aerospace, oil and gas, banks, auto manufacturing, pharmaceuticals, and telecommunication.

In the banking industry, ING Group (ING) gave a negative return of ~-2.6%. Banco Santander (SAN) gave the largest negative return in the banking industry at ~-25.5%. Banco Santander announced that it will expand its investment bank operations in the United States and the United Kingdom. The bank made losses in most of its investment banking business across Latin America.

In the auto manufacturing industry, Volkswagen (VLKAY) gave the highest negative return of ~-39.5% due to the emissions scandal issue.

In the telecommunication industry, Nokia (NOK) returned ~-6.8%.

Above is a graph that shows the industries that underperformed in the ETF.

The SPDR Euro Stoxx 50 ETF returned ~0.2% in the trailing-one-month period despite some of its industries providing negative returns.

Read the Market Realist series Why a 3.1% Global Growth Rate in 2015 Is Doubtful to learn more about the world economy.

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