Newsquawk Daily European Equity Opening News - 10th February 2023

10th February 2023

ASIA

Asia-Pac stocks were mostly negative following the weak performance of their counterparts on Wall St where the major indices wiped out their initial gains and virtually spent the entire session on the back foot as sentiment was hampered by higher yields and after recession fears were stoked amid the deepest 2s/10s yield inversion since the 1980s. ASX 200 (-0.8%) was dragged lower as underperformance in tech led the declines seen in almost all sectors and after the latest RBA Statement on Monetary Policy reaffirmed the view that further rate hikes will be needed. Nikkei 225 (+0.2%) bucked the trend amid an overload of earnings releases and with Japanese PPI data printing softer than expected, although advances are capped as participants second-guess who will succeed BoJ Governor Kuroda with the government set to present its nomination on Tuesday. Hang Seng (-1.7%) and Shanghai Comp. (-0.4%) were lower with Hong Kong pressured by weakness in the property and tech industries, while frictions lingered as the US seeks to take action against Chinese entities linked to the surveillance balloon and reportedly aims to curtail technology investment in China.

TSMC (2330 TT/TSM) - January rev. rose 16.2% Y/Y to TWD 200.1bln. (Newswires)

EUROPEAN CLOSES

CLOSES: EURO STOXX 50 +0.97% at 4,250, FTSE 100 +0.33% at 7,91, DAX 40 +0.72% at 15,523, CAC 40 +0.96% at 7,188, FTSE MIB +1.26% at 27,503, IBEX 35 +0.18% at 9,243, SMI -0.47% at 11,223.

SECTORS: Energy 1.69%, Industrials 1.58%, IT 1.14%, Consumer Disc 0.93%, Financials 0.88%, Telecoms 0.08%, Healthcare 0.02%, Utilities -0.04%, Consumer Stpl -0.28%, Materials -0.53%

FTSE 100

Barclays (BARC LN) - Co. is being probed by the UK’s FCA for suspected persistent failings around its compliance and anti-money laundering procedures, via FT citing sources. (FT)

GlaxoSmithKline (GSK LN) - US FDA Advisory Committee votes in support of trials designed to evaluate Jemperli as a potential treatment for mismatch repair-deficient/microsatellite instability-high locally advanced rectal cancer. (GSK)

NatWest (NWG LN) - CEO says the Co. will stop offering loans to new customers which are looking to fund gas/oil exploration, extraction or production. (Guardian)

Standard Chartered (STAN LN) - First Abu Dhabi Bank said it is not evaluating an offer for Standard Chartered. (Newswires) This follows reports on Thursday that First Abu Dhabi Bank was said to be mulling a bid for the Co. after the UK takeover rules lapse, according to Bloomberg sources. (Newswires)

UK Insurance - UK Treasury is in discussions to speed up Solvency II reforms, according to the FT. (FT)

OTHER UK COMPANIES

BROKER MOVES

Shell (SHEL LN) downgraded to Underweight from Equal Weight at Morgan Stanley

Smurfit Kappa (SKG LN) downgraded to Neutral from Overweight at JPMorgan Chase

DAX

Adidas (ADS GY) - Co. lowers revenue guidance by circa EUR 1.2bln and operating profit by approx. EUR 500mln in 2023. Continues to review future options for the utilisation of its Yeezy inventory; guidance already accounts for the significant adverse impact from not selling existing stock. Co. expects currency-neutral sales to decline at a high-single-digit rate in 2023. Underlying operating profit is projected to be around the break-even level. Should the Co. decide not to repurpose any of the existing Yeezy product going forward, this would result in the write-off of the existing Yeezy inventory and would lower the company's operating profit by an additional EUR 500mln this year. Co. expects one-off costs of up to EUR 200mln in 2023; costs are part of a strategic review aimed at reigniting profitable growth as of 2024. If all these effects above were to materialise, Co. would expect to report an operating loss of USD 700mln in 2023. (Newswires/Adidas) *Co. holds a ~2% weighting in the DAX 40. *

Siemens (SIE GY) - shareholders approve the dividend proposal of EUR 4.25/shr. (Newswires)

OTHER GERMAN COMPANIES

BROKER MOVES

Adidas (ADS GY) downgraded to Hold from Buy at Jefferies

CAC

Energy Names - France is looking at using proceeds from a centuries-old savings account to help finance a EUR 50bln project for six nuclear reactors, according to FT. (FT)

L'Oréal (OR FP) - Q4 FY22 (EUR): Revenue 10.32bln (exp. 10.13bln), Comp. Sales +8.1% (exp. +6.8%). FY22 Op. 7.46bln (exp. 7.44bln), FY22 Net 5.71bln (exp. 5.8bln). Proposes 25% dividend hike to 6.00/shr. Like-for-like sales breakdown: Professional products +8.1% (exp. +2.2%), Consumer products +7.5% (exp. +6.2%), Luxe +5.5% (exp. +5.8%), Active Cosmetics +19.4% (exp. +21.7%). (Newswires). L'Oreal's ADR (LRLCY) closed +1.4%.

OTHER FRENCH COMPANIES

Euronext (ENX FP) - FY22 (EUR): Revenue 1.42bln (prev. 1.30bln Y/Y), adj. EBITDA 861.6mln (exp. 860.2mln); proposes dividend of 2.22 for 2022. (Newswires)

BROKER MOVES

PAN EUROPE

Enel (ENEL IM) - Prelim FY22 (EUR): Revenue 140.5bln (exp. 109bln), EBITDA 19.7bln (exp. 19.3bln). (Newswires)

European Airliners - Korean Air's (003490 KS) bid for Asiana (020560 KS) is set to face a full-scale, four-month EU antitrust probe when the prelim. probe ends on February 17th, according to Reuters sources. Concerns focus on routes from Seoul to Barcelona, Frankfurt, Paris, and Rome. (Newswires)

Unipol Gruppo (UNI IM) - FY22 Net 865.9mln (exp. 867.4mln). Direct Insurance Income 13.6bln (prev. 13.3bln Y/Y). Combined ratio 91% (prev. 92.5%). Solvency Ratio 201% (prev. 197% Q/Q). (Newswires)

BROKER MOVES

ArcelorMittal (MT NA) upgraded to Buy from Hold at Deutsche Bank

SMI

Credit Suisse (CSGN SW) - Swiss regulator FINMA said Credit Suisse's outflows in Q4 were "indeed significant", and said it monitors banks very closely during these situations. (Newswires)

Roche (ROG SW) - "Roche Long Term Foundation acquired 540k Roche bearer shares at the price determined via an accelerated book building (ABB) process. The Foundation will use these shares to cover current as well as future obligations arising from equity compensation plans. This announcement is based on reports that a member of a shareholder group with pooled voting rights sold 2.7mln Roche bearer shares via this ABB process. Following this transaction, the shareholder group with pooled voting rights owns circa 65% (previously 67.5%) of the issued share capital of Roche." (Roche) Earlier, unconfirmed reports suggested a secondary offering price guidance of CHF 305-310/shr (vs. CHF 284.60 close on Thursday). (Newswires)

OTHER SWISS COMPANIES

BROKER MOVES

Swisscom (SCMN SW) upgraded to Hold from Sell at Berenberg

SCANDINAVIA

BROKER MOVES

Equinor (EQNR NO) upgraded to Equal Weight from Underweight at Morgan Stanley

US

CLOSES: SPX -0.88% at 4,081, NDX -0.91% at 12,381, DJIA -0.73% at 33,699, RUT -1.40% at 1,915.

SECTORS: Communication Services -2.8%, Materials -1.41%, Utilities -1.41%, Financials -1.23%, Real Estate -1.01%, Industrials -0.88%, Health -0.86%, Energy -0.71%, Technology -0.5%, Consumer Staples -0.3%, Consumer Discretionary -0.21%.

Intel (INTC) - Co. considers boosting investment in Vietnam to expand chip testing and packaging plant. (Newswires)

Lyft Inc (LYFT) - Q4 2022 (USD): EPS -0.74 (exp. 0.13), Revenue 1.18bln (exp. 1.16bln). Q4 adj. EBITDA 126.7mln excluding the impact from the increase to insurance reserves and accrued liabilities. Q4 Adj. EBITDA -248.3mln (prev. -47.6m Y/Y). Adjusted net loss 270.8mln (prev. -90.2m Y/Y). Sees Q1 revenue about USD 975mln (exp. 1.09bln). Sees Q1 adjusted EBITDA USD 5mln-15mln. (Newswires) Shares fell 30% after market.

PayPal (PYPL) - FY23 adj. EPS view 4.87 (exp. 4.75), Q1 23 adj. EPS view 1.08-1.10 (exp. 1.06). Sees 2023 operating expenses down by high single digits and plans an additional USD 600mln in savings this year. (Newswires) Shares fell 0.8% after market.

10 Feb 2023 - 06:48- Research Sheet- Source: Newsquawk