Strong start for AEX

The AEX index started the first full trading week of the year with a big gain and a record high. However, it did not rise in a straight line. The gains made on Monday and Tuesday were wiped out on Wednesday and Thursday, but on Friday the main index on the Damrak was back on the rise. The volatility was caused by the heavyweights. Chip stocks, which collectively have a large weighting in the index, performed well. Heavyweights Shell and Unilever, on the other hand, suffered losses.

On balance, the AEX closed 1.2% higher than last Friday morning. At the time of writing, the index is trading at around 979 points this Friday morning. The positive stock market sentiment was visible worldwide, with the AEX index even lagging the European Stoxx 600, which posted a 1.6% gain. The big winners – alongside chip stocks ASML (+7.1%) and ASMI (+9.4%) – were InPost (+36.7%) and Philips (+9.5%). Among the losers, the pain was greatest for Shell (-4.8%), Ahold-Delhaize (-3.5%) and KPN (-2.5%).

Contradictory news from heavyweights

Company news is still limited this week, as almost all companies are in their quiet period ahead of the reporting season. Nevertheless, chip stocks ASML and ASMI performed particularly well this week. First, there was favourable news from Samsung. The company spoke positively about demand for one of its chips. This had a positive effect on the entire semiconductor industry. During the week, several investment banks also published positive analyst reports on ASML and ASMI.

Shell reported disappointing oil trading in its fourth-quarter update, which the company always provides before its quarterly results. Despite the disappointing trading, operations performed slightly better than expected.

Logistics company and parcel delivery service InPost rose the most this week, after Sky reported that a consortium including investment company Advent is preparing a billion-pound bid to take over the company.

TomTom announced that Cariad will use TomTom maps. Cariad is Volkswagen's software company that develops software for self-driving cars, among other things. Finally, ASR Nederland acquired all insurance activities of Bovemij (BOVAG) for EUR 185 million.

Corporate earnings season kicks off

Next week, starting on Tuesday, the earnings season will begin. As is tradition, the major US banks will kick things off with the publication of their quarterly results. Apart from that, few or no other companies are reporting their figures at this stage. Incidentally, the market is expecting a decline in profits (-3.9%) and turnover (-2.6%) for the Stoxx 600 in the fourth quarter on an annual basis. From next quarter onwards, companies in the Stoxx 600 are expected to again report profit growth, which will pick up in the following quarters. For the US S&P 500 index, profit and revenue growth expectations for the coming earnings season are 8.9% and 7.3% respectively.

On the macroeconomic front, we are heading into a busy week, but with a limited number of important figures. However, the US inflation report due out on Tuesday is one of them. The market expects inflation to remain unchanged year-on-year in December (2.7%). US retail sales for November are expected to show growth of 0.4% month-on.