Newsquawk Daily European Equity Opening News

5th July 2024

ASIA

APAC stocks traded somewhat mixed in the absence of a lead from the US owing to the Independence Day holiday, while there was also a lack of fireworks from the UK election exit polls which showed the Labour Party are on course for a landslide victory. ASX 200 was contained amid weakness in miners and the top-weighted financial sector. Nikkei 225 traded indecisively and initially climbed to fresh record highs but then failed to sustain the momentum as the yen began to strengthen and as participants also digested weak Household Spending data which showed a surprise contraction. KOSPI was boosted amid gains in index heavyweight Samsung Electronics following its preliminary Q2 earnings. Hang Seng and Shanghai Comp. were pressured with weakness seen in automakers after the EU confirmed it is to move ahead with planned tariffs on Chinese EVs with provisional duties effective today, while China is to continue the anti-dumping probe into EU port imports and will hold an EU brandy probe hearing on July 18th.

Japanese Stocks - Market is closely watching an expected USD 7bln+ sell-off of ETFs on Monday and Wednesday, via Nikkei; sale is to raise funds for dividend payments. (Nikkei)

Samsung Electronics (005939 KS) - The world's largest memory chip, smartphone and TV maker sees a better than expected increase in Q2 profits, as the AI boom lifts chip prices. Sees Q2 profit rising to KRW 10.4tln (exp. 8.8tln; prev. 670bln in Q2 2023), and sees Q2 sales of KRW 74tln (exp. 74.5tln). (Newswires)

EUROPEAN CLOSES

CLOSES: DAX 18453, -0.01%; FTSE 100 8241, +0.9%; CAC 40 7695, +0.8%; Euro Stoxx 50 4987, +0.5%; AEX 934, +0.4%; IBEX 35 11066, +0.1%; FTSE MIB 34106, +0.8%; SMI 12088, +0.6%

SECTORS: Energy 1.24%, Financials 0.89%, Materials 0.58%, Healthcare 0.53%, Telecoms 0.52%, Consumer Disc 0.43%, Consumer Stpl 0.43%, Industrials 0.33%, Utilities -0.06%, IT -0.08%

FTSE 100

Glencore (GLEN LN) - Canada's ISED has approved the Glencore-Teck Resources (TECK) deal, according to Reuters. (Newswires)

HSBC (HSBA LN) - Sale of its German wealth-management unit is reportedly attracting interest from the likes of BNP Paribas (BNP FP) and UBS (UBSG SW). (Bloomberg)

UK Election - JPMorgan sector-level impacts, Labour gov't focussed. Mixed 1) Utilities - positive when it comes to investment in a zero carbon electricity system but UK water names are likely to remain under pressure. 2) General Retail - increases in the minimum wage could add to costs for the sector. Negatives: 1) Transportation - nationalisation of the railways would act as a drag on the sector. 2) Energy: - increase and extensions of the Energy Profits Levy. Positives: 1) Banks - political stability would be a positive for the sector. 2) Homebuilders - there is a key focus on the provision of affordable housing as well as reform of the planning system. 3) Food Retail - Labour would support policies aimed at incentivising private sector investment and continued focus on the cost of living crisis. (Newswires) The count is ongoing but the most recent tally has Labour surpassing the majority point.

OTHER UK COMPANIES

BROKER MOVES

DAX

Porsche (P911 GY) - Varta (VAR1 GY) is in discussions with Porsche regarding a potential investment in the large-format lithium-ion business, V4Drive. (Newswires) Varta +15% in pre-market trade.

OTHER GERMAN COMPANIES

BROKER MOVES

CAC

Eiffage (FGR FP) - Consortium has won a contract to construct four electrical substations off the coast of Belgium, for the world's first artificial energy island. (Newswires)

OTHER FRENCH COMPANIES

BROKER MOVES

PAN EUROPE

Alcohol Names - China's MOFCOM confirmed it is to hold an EU brandy probe hearing on July 18th. (Newswires)

Commodity/Mining Names - Coal firms within Australia are seeing significant upside following on from a fire shutting down a Anglo American (AAL LN) mine earlier in the week. In response to the fire, Morgan Stanley writes that the expect about 15% upside to end-2024 coking coal prices. (Bloomberg)

Metal/Mining Names - Iron ore pressured in APAC trade, dropping for the first occasion in six trading sessions. (Newswires)

Stellantis (STLAM IM/STALP FP) - Lancia brand has concluded H1 with a 3% growth in registrations and market share of 2.8%. (Newswires)

BROKER MOVES

SMI

Roche (ROG SW) - US FDA has approved Vabysmo prefilled syringe for three leading causes of vision loss. (Newswires)

OTHER SWISS COMPANIES

BROKER MOVES

SCANDINAVIA

Clas Ohlson (CLASB DC) - June (SEK): Sales 853mln (prev. 748mln), +6% Y/Y. (Newswires)

BROKER MOVES

US

Amazon (AMZN) - Founder Jeff Bezos plans to sell 25mln Amazon shares worth nearly USD 5bln after the company's stock hit a record high, BBC reports. This is his first sale since 2021. (BBC)

05 Jul 2024 - 06:45- EquitiesResearch Sheet- Source: Newsquawk