EUROPEAN EQUITY OPEN: Mixed start to the week as oil prices rise; Biden to host leaders call on Russia today

INDICES: At 08:12, Euro Stoxx 50 -0.12% at 3,898; FTSE 100 +0.22% at 7,421; DAX -0.15% at 14,391; CAC 40 +0.02% at 6,622; IBEX 35 +0.33% at 8,446; FTSE MIB +0.00% at 24,222; SMI +0.04% at 12,189. Sectors are mixed: Energy is higher amid higher energy prices; Real Estate is lower as yields pick up. Tech stocks (Growth style) are also under pressure.

OPEN: European equities opened with a note of caution as the Russia assault on Ukraine continues, where Russia severed Ukraine’s access to the Sea of Azov over the weekend, with the region of Mariupol–a strategic area between Russian-annexed Crimea and Donetsk–on the brink of being lost to Russia. Ukrainian President Zelensky has said he is ready to negotiate with Russia’s President Putin, although a Turkish official said the latter was not ready. Crude prices have resumed to the upside, once again (Brent and WTI up about USD 3.80-4.10/bbl), flaming concerns about inflation amid a slowing growth impulse; Saudi Aramco CEO over the weekend warned that there was limited spare capacity, which is declining every month, and that the market was very tight. President Biden will hold a call with leaders from the UK, France, Germany, Italy to further discuss Russia today; the US President is also set to tour Europe this week. Elsewhere, there is more central bank speak due today, with ECB boss Lagarde and Fed chief Powell both on the slate (both have spoken recently, so their remarks aren't expected to add too much to the narrative). Full Day Ahead here. 

STOCK SPECIFICS: In deal news, Antofagasta (ANTO LN) mulls Pakistani project exit; a Hedin Group offer for Pendragon (PDG LN) was reportedly rejected by the Board; KKR (KKR) officials are divided on how to proceed with Telecom Italia (TIT IM) offer. In results, Salzgitter (SZG GY) profit guide for 2022 was higher than expected. Volkswagen (VOW3 GY) Chinese unit plans to line up JVs for battery raw materials; separately, VW is recalling more than 246k SUVs in the US and Canada due to faulty wiring harnesses. ASML (ASML NA) CEO warns of shortages of lithography machines, while Intel (INTC) sent manufacturing experts to ASML to assist in increasing production. On the energy front, UK North Sea regulator preparing to issue licences; UK PM to outline today a “gung ho” approach to increasing nuclear power. In Russia-related updates, Deutsche Bank (DBK GY) CEO reportedly urged the the government to hold off on further Russian sanctions for now. UniCredit (UCG IM) facing difficulties with sale of ABH Holding stake. Renault's (RNO FP) Avtovaz has partially halted production amid supply shortages, according to reports.

NOTABLE MOVERS:

• Pendragon (PDG LN) +15.6%: Reportedly rejected Hedin offer.


• Salzgitter (SZG GY) +3.3%: Solid guidance.


• Vallourec (VK FP) +2.8%: Appointed new CEO.


• Antofagasta (ANTO LN) +2.7%: Materials.


• BP (BP/ LN) +1.5%: Crude firmer.


• Shell (SHEL LN) +1.2%: Crude firmer.


• LSE (LSEG LN) +1%: To sell wealth assets.


• Telecom Italia (TIT IM) -2.3%: KKR divided on how to proceed with offer.

Our full European equity briefings for March 21st can be accessed here and here.

21 Mar 2022 - 08:13- EquitiesResearch Sheet- Source: Newsquawk