EUROPEAN EQUITY OPEN: Stocks dragged lower after hawkish Fed weighs on global equities

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  OPEN: European equities open lower, with the macro impulse from the hawkish Federal Reserve meeting weighing on global equities. The European earnings docket is also beginning to pick-up, with the tone of incoming earnings this morning leaning more on the positive than negative side on balance.


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  INDICES: At 08:06GMT, Euro Stoxx 50 -1.6%, FTSE 100 -0.8%, DAX 40 -1.6%, CAC 40 -1.4%, FTSE MIB -1.1%, IBEX 35 -0.9%, SMI -1.3%. Sectors are broadly in the red, with Tech unsurprisingly leading the downside. Defensives are faring better, although are still lower.


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  NOTABLE MOVERS: Sabadell (SAB SM) +2.9% after earnings, STMicroelectronics (STM FP) +1.5% after earnings, Deutsche Bank (DBK GY) +1.0% after earnings, ArcelorMittal (MT NA) -4.0% after Goldman cuts it to neutral, SAP (SAP GY) -3.0%  after earnings, Renault (RNO FP) -0.9% after announcing its investment plans (as was flagged earlier in the week).

MATERIALS:

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  Antofagasta (ANTO LN) - Two mineral leases cancelled by the US for its twin metals copper mine project in Minnesota; US said leases were "improperly renewed" under the Trump administration.


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  Anglo American (AAL LN) - Q4 2021 Production: Copper 161kt (prev. 168kt Y/Y). Iron ore output 15.1Mt (prev. 16.2Mt Y/Y).


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  Fresnillo (FRES LN) downgraded to Sector Perform from Outperform at RBC, downgraded to Hold from Buy at Jefferies.

HEALTH CARE:

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  GlaxoSmithKline (GSK LN) - JV with US Life Sciences announced first patient with Rheumatoid Arthritis was treated.


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  Sartorius (SRT GY) - Prelim. FY21 (EUR): sales Revenue 2.89bln (prev. 1.9bln), EPS 7.46 (prev. 4.16), EBITDA 1.03bln (prev. 0.60bln), net profit 0.69bln (prev. 0.38bln).


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  Philips (PHIA GY) - US FDA calls Co’s expanded recall of certain ventilators late last year as the most serious type, could lead to injuries or death.


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  Orpea (ORP FP) - Board mandates two firms to conduct investigations into recent allegations against the company.

FINANCIALS:

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  Deutsche Bank (DBK GY) - Q4 net EUR 5.90bln (exp. 5.68bln). FICC Sales & Trading 1.20bln (exp. 1.28bln). Pretax 82mln (prev. 175mln Y/Y). Says is well positioned to achieve ROTE of 8%. Announced EUR 300mln buyback to be completed in H1, proposes dividend of EUR 0.20/shr for FY21. Provisions for credit losses 515mln (prev. 251mln).


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  DWS (DWS GY) - FY21 revenue EUR 2.72bln (prev. 2.24bln). Adj. Pretax 1.14bln (prev. 795mln). AUM 928bln (prev. 793bln). (Newswires)


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  UBS (UBSG SW) - To acquire Wealthfront for USD 1.4bln in cash. Separately, was reiterated with Overweight at JPMorgan Chase.


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  Generali (G IM) - To become a majority shareholder in its Indian Insurance JVs, will purchase Future Enterprise Limited’s 25% stake for circa. EUR 145mln, taking its stake to the 73% maximum.


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  Banco Sabadell (SAB SM) - Q4 2021 (EUR): 161mln (exp. 139mln). NII 863mln (prev. 854mln). CET1 +16bps Y/Y.


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  SEB (SEB SS) - Q4 (SEK): net income 6.2bln (exp. 5.9bln), NII 6.7bln (exp. 6.7bln), EBIT 12.88bln (exp. 7.5bln). Propose a dividend of 6.00/shr. Plan, during FY22, to distribute 5-10bln via share buybacks.


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  St James’s Place (SJP LN) - Q4 gross business inflows GBP 4.69bln (prev. 4.02bln YY), net inflows 2.9bln (prev. 2.3bln YY). CEO says gross inflows exceed prior guidance, remain confident in achieving 2025 ambitions.

TECH:

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  SAP (SAP GY) - Q4 revenue EUR 7.98bln (prev. 7.91bln), EPS 1.86 (exp. 1.64). Sees FY22 adj. operating profit 7.8-8.25bln (exp. 8.4bln). Cloud and Software Revenue 6.99bln (prev. 6.579bln). Said it hit the high end of its revised 2021 cloud revenue outlook range and exceeded its cloud and software revenue and operating profit outlook ranges. Confident that its positive momentum will continue throughout 2022, expects accelerating cloud revenue growth. To acquire a minority stake in Taulia, terms undisclosed.


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  Software AG (SOW GY) - Q4 2021 (EUR): Revenue 234.6mln (exp. 234mln). Net 34.8mln (exp. 26mln) Adj. EBITDA 45.2mln (exp. 38.5mln). Co. guides FY22 adj. EBITDA margin between 20-22%.


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  STMicroelectronics (STM FP) - Q1 2022 (EUR): Net Revenue 3.5bln (exp. 3.25bln). Sees Q1 gross margin 45% (exp. 41.9%). Sees 2022 Capex 3.4-3.6bln and Net Revenue 14.8-15.3bln.


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  Apple (AAPL), Square (SQ) - Apple is planning a new service that will let small businesses accept payments directly on their iPhones without any extra hardware; devices currently require external terminals such as Square’s.


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  Intel (INTC) - Declined by 2.75% in afterhours trading after results. Despite metrics which topped analyst expectations for the quarter, and hiking its dividend by 5%, the chipmaker provided weak guidance for the next quarter. Adj. EPS 1.09 (exp. 0.91), Revenue 20.5bln (exp. 18.32bln), Client Computing Group revenues 10.1bln (exp. 9.57bln), Data Center Group revenues 7.3bln (exp. 6.68bln). Sees Q1 adj. EPS at 0.80 (exp. 0.86/0.77 GAAP), and sees Q1 revenues at 18.3bln (exp. 17.62bln).


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  Lam Research (LRCX) - EPS beat, revenue missed, and guidance was soft. Q1 EPS was 8.53 (exp. 8.51), Revenue USD 4.23bln (exp. 4.41bln); next quarter revenues are seen at 4.25bln (exp. 4.51bln), with EPS at 7.45 (exp. 8.74). Said supply chain conditions worsened in December causing near-term impacts on its results. Sees wafer fabrication equipment investments increasing again in 2022.


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  Xilinx (XLNX) - Rose slightly in afterhours trade. Q3 Adj. EPS 1.29 (USD 0.95), revenue USD 1.01bln (exp. 956.8mln). Said it was unable to fully satisfy customer needs, and noted the 'extremely tight' supply conditions.


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  Seagate Technology (STX) - Rose almost +7% in extended trading; metrics were mostly in line, but it raised its FY 22 view. EPS 2.41 (exp. 2.35), revenue USD 3.12bln (exp. 3.11bln). FY 22 revenue seen rising between 12-14% (prev. it saw 'low double-digit' range).

ENERGY:

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  Siemens Energy (ENR GY) - Reportedly increased efforts to explore a full integration of wind turbine business Siemens Gamesa (SGRE SM).

CONSUMER STAPLES:

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  Nestle (NESN SW) - To invest CHF 1.3bln in cocoa sustainability by 2023.


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  Diageo (DGE LN) - H1 2022 (GBP): Revenue 7.96bln (prev. 6.87bln). Adj. operating profit 2.74bln (prev. 2.24bln). Net 2.09bln (prev. 1.66bln). Co. expects organic net sales momentum to continue throughout H2 2022. (Newswires)


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  Brtivic (BVIC LN) - Q1 total revenue +16.5% Y/Y.


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  Fevertree (FEVR LN) - FY21 Revenue GBP 311.1mln (exp. 252.1mln Y/Y).

CONSUMER CYCLICAL:

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  Valeo (FR FP) - Prelim FY21 EUR 17.3bln (prev. 16.9-17.2bln). EBITDA margin 13.4% (prev. 13-13.4%).


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  Swatch (UHR SW), Richemont (CFR SW) - Swiss Watch Exports vs 2019 (Dec) +8.5% vs prev. +8.6%.


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  Elior (ELIOR FP) - Q1 (EUR): revenue 1.16bln (prev. 0.94bln). Suspending 2021-22 guidance due to the lack of visibility as we move out of the Omicron related stricter health protocols, reaffirms FY24 ambitions.

COMMUNICATIONS:

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  Telecom Italia (TIT IM) - Board gives the CEO a mandate to explore strategic options.


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  Telia (TELIA SS) - Co. and Polarium are launching a pilot to optimize network energy usage, reduce electricity costs and contribute to a more resilient electricity infrastructure.


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  Streaming Names - UK CMA is launching a probe into the music streaming market, will consider whether innovation is being stifled and if any firms have excessive power.

INDUSTRIALS:

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  Daimler (DAI GY) - Mercedes-Benz and Prologium have entered into a technology cooperation agreement.


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  Stellantis (STLA IM/FP) - Plans to increase its shareholding in GAC-Stellantis from 50% to 75%. GAC-Stellantis is a joint venture formed between China Guangzhou Automobile Group and Stellantis.


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  Tesla (TSLA) - Fell by 6% in afterhours trading after publishing its results; despite top- and bottom-line beats, the automaker alluded to supply chain issues will persist this year which limited the ability to run factories at full capacity. Q4 adj. EPS 2.54 (exp. 2.36), revenue 17.719bln (exp. 16.41bln). FCF 2.78bln (exp. 1.67bln), gross margin 30.6% (exp. 29.9%).


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  easyJet (EZJ LN) - Q1 2022 (GBP): Revenue 805mln (exp. 732.5mln). Passengers 11.9mln (exp. 12.4mln). Co. sees a strong summer ahead with pent-up demand.


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  Leonardo (LDO IM) - Could be mulling a divestment of its communications unit which could be valued between USD 300-400mln, sources say.


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  SGS (SGSN SW) - FY21 (CHF): Adj. EBITDA 1.52bln (prev. 1.32bln). Net 670mln (prev. 565mln). Revenue 6.41bln (prev. 5.60bln).


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  Bpost (BPOST BB) downgraded to Hold from Buy at Jefferies.


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  Experian (EXPN LN) upgraded to Sector Perform from Underperform at RBC.


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  Legrand (LR FP) upgraded to Buy from Hold at Jefferies.


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  Rentokil (RTO LN) downgraded to Neutral from Outperform at Exane BNP.

UTILITIES:

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  RWE (RWE GY) reiterated with Overweight at JPMorgan Chase.

REAL ESTATE:

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  Foxtons (FOXT LN) - Saw improved performance in 2021 at the top end of expectations.


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  Hammerson (HMSO LN) - Sees FY21 adj. earnings between GBP 75-80mln.

DAY AHEAD:

• 08:00GMT/03:00EST: Spain Unemployment Rate (Q4)


• 09:00GMT/04:00EST: Italy Industrial Sales (NOV)


• 09:30GMT/04:30EST: South Africa PPI (DEC)


• 10:10GMT/05:10EST: Italy 6-Month BOT Auction


• 11:00BST/06:00EDT: Danaher Corp (DHR) earnings (preview)


• 11:00GMT/06:00EST: Canada CFIB Business Barometer (JAN)


• 11:00GMT/06:00EST: Turkey CBRT Minutes, Inflation Report


• 11:00GMT/06:00EST: UK CBI Distributive Trades (JAN)


• 11:30GMT/06:30EST: Turkey Foreign Exchange Reserves (21/JAN)


• 12:00BST/07:00EDT: Comcast Corp (CMCSA) earnings (preview)


• 12:00BST/07:00EDT: McDonald's Corp (MCD) earnings (preview)


• 12:00GMT/07:00EST: Mexico Balance of Trade (DEC)


• 13:00BST/08:00EDT: Mastercard Inc (MA) (preview)


• 13:00GMT/08:00EST: SARB Rate Decision


• 13:30GMT/08:30EST: Canada Average Weekly Earnings (NOV)


• 13:30GMT/08:30EST: US GDP Growth Rate Adv (Q4)


• 13:30GMT/08:30EST: US Durable Goods Orders (DEC)


• 13:30GMT/08:30EST: US Initial Jobless Claims (22/JAN), Continuing Jobless Claims (15/JAN)


• 15:00GMT/10:00EST: US Pending Home Sales (DEC)


• 15:30GMT/10:30EST: US EIA NatGas Stocks (21/JAN)


• 16:00GMT/11:00EST: US Kansas Fed (JAN)


• 16:30GMT/11:30EST: US 4-Week, 8-Week Bill Auctions


• 18:00GMT/13:00EST: US 7-Year Note Auction


• 21:10BST/16:10EDT: Visa Inc (V) earnings (preview)


• 21:30BST/16:30EDT: Apple Inc (AAPL) earnings (preview)

27 Jan 2022 - 08:11- EnergyData- Source: Newsquawk