DAILY EUROPEAN EQUITY OPENING NEWS: Daimler (DAI GY) / Deutsche Bank (DBK GY) / BMW (BMW GY) / Siemens (SIE GY) – The Saudi Arabian Sovereign Wealth Fund are looking at German Blue chip names

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20^th October 2016

ASIA

Asia equity markets traded mostly higher following the positive Wall St. where gains in oil and encouraging earnings supported risk sentiment. ASX 200 (+0.1%) was led higher by commodity names after WTI rose to its highest level since July 2015 following a DoE drawdown of 5.2mln barrels, while Nikkei 225 (+1.1%) outperformed alongside a rebound in USD/JPY. Chinese markets were mixed with the Hang Seng (+0.7%) conforming to the positive tone following another firm liquidity injection by the PBoC, while the Shanghai Comp. (-0.1%) traded choppy as reduced hopes of stimulus measures capped gains. 10-yr JGBs traded flat with demand dampened amid firm gains in Japanese stocks, while today’s enhanced liquidity auction for 10yr, 20yr and 30yr JGBs saw an improvement in demand with the b/c increasing from last month.

FTSE

Barclays (BARC LN) – Co. CEO Staley said they are making progress on job reductions, adds there will be job cuts due to Brexit and that they will have to adapt. (Newswires)

Rio Tinto (RIO LN) – Co. reported Q3 iron ore production at 83.2Mt vs. Prev. 86.1Mt Y/Y. (Newswires)

OTHER UK COMPANIES

Aberdeen Asset Management (ADN LN) – Co. is to sell some assets to TriState Capital although terms were not disclosed. (Newswires)

BROKER RECOMMENDATIONS

ABERDEEN ASSET MANAGEMENT (ADN LN) DOWNGRADED TO UNDERPERFORM FROM HOLD AT JEFFERIES

AGGREKO (AGK LN) DOWNGRADED TO UNDERPERFORM FROM NEUTRAL AT CREDUT SUISSE

Companies going ex-dividend:

FTSE 100: BAE Systems (BA/ LN), Capita (CPI LN), HSBC (HSBA LN), INTU (INTU LN), Rolls-Royce (RR/ LN), Smiths Group (SMIN LN), trimming 8.76 points off the FTSE 100.

DAX

Daimler (DAI GY) / Deutsche Bank (DBK GY) / BMW (BMW GY) / Siemens (SIE GY) – The Saudi Arabian Sovereign Wealth Fund are looking at German Blue chip names to expand their investment portfolio, according to sources. (Handelsblatt)

E.on (EOAN GY) – Co. is set to report another record loss this year due to costs related to the transition to cost of renewable energy. (Handelsblatt)

Deutsche Lufthansa (LHA GY) – Co. reports 9-month Adj. Ebit EUR 1.68bln vs Prev. EUR 1.69bln, revenue EUR 23.9bln vs. Prev. EUR 24.3bln, raises FY Adj. Ebit, however cuts Q4 revenue outlook at constant currency. (Newswires)

OTHER GERMAN COMPANIES

GEA Group (G1A GY) – Q3 operating EBITDA prelim EUR 130mln, Q3 rev EUR 1.1bln. (Newswires)

BROKER RECOMMENDATIONS

N/A

CAC

Publicis (PUB FP) – Q3 rev EUR 2.23bln vs. Exp. EUR 2.33bln, Q3 organic growth rose 0.2%. (Newswires)

Airbus (AIR FP) – The Co. expect to produce significantly more A321's in order to meet strong demand. (Handelsblatt)

Michelin (ML FP) - Q3 sales EUR 5.18bln vs. Exp. EUR 5.23bln and 9-month revenue EUR 15.5bln vs. Prev. EUR 15.8bln. (Newswires)

Vivendi (VIV FP) – Co. are to remain open-minded to an alternative deal with MediaSet (MS IM). (Newswires) This comes in the context of reports yesterday that Vivendi branded MediaSet’s plans are based on unrealistic assumptions

Pernod Ricard (RI FP) - Organic sales growth 4% vs. Exp. 2.7%, Q1 rev EUR 2.25bln vs. Exp EUR 2.24bln and Co. affirm FY17 organic growth outlook. (Newswires)

OTHER FRENCH COMPANIES

BioMérieux (BIM FP) – 9-month revenue EUR 1.51bln vs. Prev. EUR 1.4bln Y/Y. (Newswires)

Atos (ATO FP) – Q3 revenue EUR 2.78bln vs. Exp. EUR 2.22bln and raises revenue outlook. (Newswires)

ICADE (ICAD FP) - 9 month revenue EUR 99mln vs. EUR 1.3bln Y/Y and Co. affirms FY16 cash flow forecast. (Newswires)

BROKER RECOMMENDATIONS

VALLOUREC (VK FP) UPGRADED TO BUY FROM SELL AT SOCGEN

PAN-EUROPE

Philips Lighting (LIGHT NA) – Co. reports Q3 net EUR 51mln vs. Exp. EUR 37mln, Adj. Ebita EUR 175mln vs. Exp. EUR 162mln, revenue EUR 1.75bln vs. Exp. EUR 1.8bln. (Newswires)

BROKER RECOMMENDATIONS

N/A

SMI

Nestle (NESN VX) – Co. reports 9-month organic growth of 3.3% vs. Exp. 3.7%, FY16 sales rose 1% to CHF 65.5bln vs. Exp. CHF 66bln, while they lower their full year sales forecast. (Newswires)

Roche (ROG VX) - 9-month revenue rose 6% to CHF 37.5bln vs. Exp. 37.7bln, affirms FY 2016 core EPS outlook, Q3 revenue rose 4.5% to CHF 12.48bln vs. Exp. CHF 12.55bln. (Newswires)

Actelion (ATLN VX) – 9-month net CHF 691mln vs. Prev. CHF 560mln and revenue CHF 1.79bln vs. Prev. CHF 1.53bln. Raises FY16 operating income growth outlook. (Newswires)

OTHER SWISS COMPANIES

Sulzer (SUN SW) – 9-month order intake CHF 2.07bln vs. Prev. CHF 2.27bln. (Newswires)

BROKER RECOMMENDATIONS

OERLIKON (OERL VX) DOWNGRADED TO HOLD FROM BUY AT JEFFERIES

SCANDINAVIA

SEB (SEBA SS) – Q3 net income SEK 4.15bln vs. Exp. SEK 3.8bln, underlying operating profit SEK 5.23bln vs. Exp. SEK 4.7bln and net interest income SEK 4.68bln vs. Exp. SEK 4.73bln. (Newswires)

Tele2 (TEL2A SS) – Q3 EBITDA SEK 1.56bln vs. Exp. SEK 1.30bln, revenue SEK 6.98bln vs. Exp. SEK 6.87bln. Affirms FY16 revenue and EBITDA outlook. (Newswires)

Boliden (BOL SS) – Q3 operating profit SEK 1.32bln vs. Exp. SEK 1.26bln, Revenue SEK 9.73bln vs. Exp. SEK 10.6bln. (Newswires)

BROKER RECOMMENDATIONS

ELISA (EL1V FH) UPGRADED TO EQUALWEIGHT FROM UNDERWEIGHT AT BARCLAY

US

US equity markets closed mostly higher with the energy sector as the outperformer after DoE inventories showed a headline draw of 5.2mln barrels. This caused WTI to print highs not seen since July 2015 and although futures pulled back after the NYMEX close, WTI finished pit trade higher by 2.60%. Elsewhere, earnings season remained in full swing and financial earnings continued to impress, with Morgan Stanley up around 2% yesterday following a solid pre-market report. Finally, the S&P 500 finished higher by 0.22% at 2144.29, NASDAQ 100 finished lower by 0.06% at 4836.61 and DJIA finished higher by 0.22% at 18202.62.

Best Performing Sectors in the S&P 500: Energy (+1.36%), Financials (+0.84%), Materials (0.73%)

Worst Performing Sectors in the S&P 500: Consumer staples (-0.67%), Health care (-0.34%), Utilities (-0.22%)

20 Oct 2016 - 06:55- Fixed IncomeResearch Sheet- Source: RANsquawk