US, European bourses lose ground

MARKET OUTLOOK

- US: US markets were under pressure week-on-week due to concerns about rising inflation. The yield on the ten year treasury note rose above the psychological level of 5%. Stocks from utilities, real estate and consumer durables were among the worst performers, while only food and staples retails stocks managed to close on a positive note. From a technical point of view, regarding the swiftness of the recent sell off, a technical bounce should be seen in the early stage of the week. However, it should remain limited.

- EUROPE: European markets lost ground week-on-week, hurt by the surge of interest rates. All sectors were under pressure, especially shares from financials services, travel and leisure and utilies. Technically, notwithstanding a limited rise at the beginning of the week, major European markets should still remain under pressure.

COMPANY PREVIEW

Lehman Brothers Holdings (USD 74.19 ; -1.38% ; LEH ; LEH.N)

On Tuesday, Lehman Brothers is scheduled to announce 2Q EPS of $1.86 ($1.69 last year). At the beginning of June, the Co acquired a significant equity stake in SkyPower and announced its plans for a $500m IPO of a private-equity fund. In other news, the firm formed Principal Strategies Group to make investments in Asia.

Inditex (EUR 44.34 ; -5.76% ; ITX ; ITX.MC)

Wednesday, Inditex will post 1Q net income of E187m (E150m last year) on revenue of E2.03bln (E171bln). At the beginning of the year, the group considered buying some US stores from Gap (La Gaceta de los Negocios). Lately it formed a joint venture with Air France KLM to deliver garments to stores in Asia, the Mideast and the Americas (Expansion). Separately, the Co's founder Amancio Ortega intended to give control to his daughter when he retires (Times).

First Choice Holidays Plc (GBp 324 ; -8.86% ; FCD ; FCD.L)

First Choice Holidays is seen reporting 1H earnings on Thursday. Last year 1H net loss amounted to £57.8m, while revenue reached £1.01bln. In May, the group said it might sell one of its Irish businesses to win European competition regulators' approval for its merger with TUI.

Goldman Sachs (USD 225.06 ; -2.45% ; GS ; GS.N)

In the US, Goldman Sachs may publish 2Q EPS of $4.78 ($4.78 last year). At present, the Co is trying to assemble an extra group of bidders for New Look Group (Financial News) and denied rumours about its possible entry to the bidding group (FT). In other news, the Co sold 21% of Vueling Airlines.

Adobe Systems (USD 43.04 ; -3.35% ; ADBE ; ADBE.O)

Finally, on the same day, Adobe Systems is expected to release 2Q earnings. 2Q EPS is seen at $0.34 ($0.26 last year) on sales of $729m ($635.5m). On May 3, the Co signed a definitive agreement to acquire Scene7, a new technology for media delivery services, and prepared a new platform, Apollo, allowing users to work outside web browsers and connect to Internet by using a desktop icon (FT).