EUROPEAN OPEN: European stocks rebound after Monday losses

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  OPEN: European stocks gain after the open with the Wall Street rebound being cited as a factor, after stocks in Europe closed red on Monday (US equity futures have since resumed downside, though remain off lows seen yesterday). Geopolitics surrounding Ukraine continues to be a source of tension, while the FOMC’s Wednesday meeting is expected to allude to withdrawing accommodation. Additionally, the US Earnings slate picks up this week (GE, JNJ, RTX, AXP, NEE, VZ, LMT, TXN, MSFT all report today).


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  INDICES: At 08:06GMT, Euro Stoxx 50 +0.8%, FTSE 100 +0.5%, DAX 40 +0.5%, CAC 40 +0.9%, FTSE MIB +0.6%, IBEX 35 +0.4%, SMI +0.4%.


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  SECTORS:  Sectors were broadly in the green, with the Travel & Leisure, Basic Resources and Telecommunications leading the advance; defensives -- like Food & Beverage, Health Care, Real Estate -- were lagging, although still in the green.


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  NOTABLE MOVERS: Logitech (LOGN SW) +8.1% after earnings, Ericsson (ERICB SS) +4.4% after earnings, Swatch (UHR SW) +2.8% after earnings, with Watches of Switzerland (WOSG LN) +2.3% also gaining in sympathy, Lufthansa (LHA GY) -1.2% on reports its in talks to buy ITA stake, National Grid (NG/ LN) -0.6% after broker downgrade, Credit Suisse (CSGN SW) -0.4% on litigation provisions. 

INDUSTRIALS:

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  Volkswagen (VOW3 GY) - To collaborate with Bosch on automated driving software, could be sold to other autos in the future. Level 2 'hands free' technology to be deployed in the Volkswagen fleet in 2023.


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  Hyundai Motor (005380 KS) - Q4 net KRW 547bln (exp. KRW 1.5tln), operating profit KRW 1.5tln (exp. 1.7tln), revenue KRW 31tln (exp. 30.1tln).


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  IAG (IAG LN) - Reportedly in talks to buy a 50% stake in Air Europa, according to El Confidential.


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  PostNL (PNL NA) - Total revenue expected ~EUR 3.466bln in 2021, normalised EBIT estimated ~EUR 308mln, the higher-end of previous guide. Notes strong cashflows at EUR 288mln, higher than the previous forecast. The financial strength enables a share buy-back of EUR 250mln.


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  Royal Mail (RMG LN) - Said Q3 performance in-line with expectations. Expects growth rate to soften in Q4.


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  Stellantis (STLA IM/FP) - Open a third production unit at plant in Mulhouse, France, which will add 850 jobs.


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  Vestas Wind Systems (VWS DC) downgraded to sell from hold at SEB Enskilda.

FINANCIALS:

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  BNP (BNP FP) - Reportedly approaching possible buyers for its Spanish private banking division.


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  Unicredit (UCG IM) - Received five non-binding offers for parts of its leasing business, but no bid for the entire leasing business.


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  Credit Suisse (CSGN SW) - Flags litigation provisions of around CHF 500mln, expected to negatively impact Q4 pre-tax to around break-even.


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  Abrdn (ABDN LN) - Looking into how investors can purchase 'tokens' in buildings, funds and infrastructure assets; work is taking place with Citigroup (C) on blockchain technology.


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  DWS (DWS GY) - Deutsche Bank (DBK GY) alerted Bafin to a EUR 160k payment made by a client to one of its most senior bankers, FT reports.


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  THG (THG LN) upgraded to outperform from sector perform at RBC.

COMMUNICATIONS:

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  ITV (ITV LN) - To extend its evening news bulletin to one hour amid challenge from Piers Morgan show on new channel TalkTV.


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  Publicis (PUB FP) upgraded to outperform from neutral at Oddo Securities.


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  Rightmove (RMV LN) initiated with outperform at Davy Research.

MATERIALS:

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  Rio Tinto (RIO LN) - Settles feud with Mongolia over Oyu Tolgoi copper mine; Oyu Tolgoi project will now move forward.

CONSUMER DISCRETIONARY:

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  Swatch (UHR SW) - FY21 EBIT CHF 1.02bln (exp. 900mln). Revenue CHF 7.31bln (prev. 5.601bln Y/Y). Operating margin 14% (exp. 12.9%).


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  Boohoo (BOO LN) downgraded to sector perform from outperform at RBC.

CONSUMER STAPLES:

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  Unilever (ULVR LN) - Plans to slash thousands of management positions across its operations as activist Trian builds stake, Reuters reports.


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  Remy Cointreau (RCO FP) - Q3 revenue EUR 1.09bln (prev. EUR 780.9mln Y/Y). Cognac revenue +38.5% Y/Y, Liqueurs +39.1% Y/Y, Partner Brands +20.1% Y/Y.

REAL ESTATE:

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  Home24 (H24 GY) - Q4 revenue EUR 152mln (prev. EUR 152mln Y/Y), cuts FY21 EBTIDA and revenue outlook amid weakness in its Brazilian market.

HEALTH CARE:

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  Roche (ROG SW) - Evrysdi granted FDA priority review for babies with spinal muscular atrophy.


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  Orpea (ORP FP) - Refuted Le Monde article which claimed alleged mistreatment of elderly in retirement homes.


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  Diasorin (DIA IM) - Board has full confidence in CEO, expects him to be cleared in the insider-trading investigation.


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  QIAGEN (QIA GY) - Completed the US federal contract to equip local public health authorities with QIAcuity digital PCR system for COVID-19 surveillance.


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  Evotec (EVT GY) - Entered a target and drug discovery partnership with Boehringer Ingelheim, focusing on induced pluripotent stem cell-based disease modelling for ophthalmologic disorders.


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  Lundbeck (LUN DC) - Vyepti approved by EU Commission for the preventive treatment of migraine in adults.


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  Genmab (GMAB DC) upgraded to buy from hold at DNB Markets.


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  Novartis (NOVN SW) downgraded to hold from buy at Liberum.


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  Novo Nordisk (NOVOB DC) downgraded to sell from hold at Liberum.


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  Sanofi (SAN FP) upgraded to buy from hold at Liberum.

TECH:

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  International Business Machines (IBM) - Rose after hours following decent Q4 earnings, where it saw the best rate of sales growth in more than a decade. Q4 EPS 3.35 (exp. 3.30), Revenue 16.70bln (exp. 15.96bln). Now has 3,800+ hybrid cloud platform clients (+1,000 Y/Y)


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  Logitech (LOGN SW) - Q3 revenue USD 1.63bln (exp. USD 1.51bln), EPS USD 1.55 (exp. 1.31). Raises FY22 operating profit view to USD 850-900mln (prev. USD 800-850mln), and revenue growth is seen +2-5% Y/Y (prev. flat).


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  Ericsson (ERICB SS) - Q4 revenue SEK 71.3bln (exp. SEK 68.1bln). Adj. operating profit SEK 12.3bln (prev. SEK 10.0bln). Net SEK 10.1bln (prev. 7.2bln Y/Y). Gross margin 43.5% (prev. 40.6% Y/Y). Organic sales +2% Y/Y. Proposes dividend of SEK 2.50/shr (exp. 2.18/shr). Affirms long term EBITA margin.

MATERIALS:

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  Holmen (HOLMB SS) downgraded to buy from hold at Nordea.

UTILITIES:

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  National Grid (NG/ LN) downgraded to sector perform from outperform at RBC.


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  Orsted (ORSTED DC) downgraded to sector perform from outperform at RBC.


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  Uniper (UN01 GY) upgraded to sector perform from underperform at RBC.

DAY AHEAD 25/JAN: 

• 08:00GMT/03:00EST: Spain PPI (DEC)


• 09:00GMT/04:00EST: Germany Ifo (JAN)


• 11:00GMT/06:00EST: Brazil FGV Consumer Confidence (JAN)


• 11:00GMT/06:00EST: UK CBI Business Optimism Index (Q1)


• 11:00GMT/06:00EST: UK CBI Industrial Trends Orders (JAN)


• 11:15GMT/06:15EST: General Electric Co (GE) earnings (preview)


• 11:25GMT/06:25EST: Johnson & Johnson (JNJ) earnings (preview)


• 11:55GMT/06:55EST: Raytheon Technologies Corp (RTX) earnings (preview)


• 12:00GMT/07:00EST: Mexico Economic Activity (NOV)


• 12:00GMT/07:00EST: American Express Co (AXP) earnings (preview)


• 12:30GMT/07:30EST: Nextera Energy Inc (NEE) earnings (preview)


• 12:30GMT/07:30EST: Verizon Communications Inc (VZ) earnings (preview)


• 12:30GMT/07:30EST: Lockheed Martin Corp (LMT) earnings (preview)


• 13:55GMT/08:55EST: US Redbook (22/JAN)


• 14:00GMT/09:00EST: US S&P/Case-Shiller Home Price (NOV)


• 14:00GMT/09:00EST: US FHFA House Price Index (NOV)


• 15:00GMT/10:00EST: US Richmond Fed (JAN)


• 16:30GMT/11:30EST: US 52-Week Bill Auction


• 17:00GMT/12:00EST: Brazil Federal Tax Revenues (DEC)


• 18:00GMT/13:00EST: US 5-Year Note Auction


• 21:00GMT/16:00EST: South Korea Consumer Confidence (JAN)


• 21:00GMT/16:00EST: Texas Instruments Inc (TXN) earnings (preview)


• 21:10GMT/16:10EST: Microsoft Corp (MSFT) earnings (preview)


• 21:30GMT/16:30EST: US API Crude Oil Stock Change (21/JAN)

25 Jan 2022 - 08:10- Fixed Income- Source: Newsquawk