Newsquawk Daily European Equity Opening News - 12th May 2025

ASIA

APAC stocks began the week with mild gains amid hopes related to a US-China trade deal after substantive progress was said to have been made during talks in Switzerland over the weekend, but with gains capped given a lack of details announced so far and with the sides to provide a joint statement later today. ASX 200 was led higher by the commodity-related sectors with outperformance in energy after the recent oil rally. Nikkei 225 advanced at the open with the help of a weaker currency but then briefly wiped out all of the gains with pressure seen in pharmaceuticals after US President Trump announced he will sign an executive order on Monday with prescription drug and pharmaceutical prices to be reduced almost immediately by 30%-80%. Hang Seng and Shanghai Comp were underpinned following US-China trade talks over the weekend in which both sides noted that progress was made and they agreed to establish a China-US trade consultation mechanism, although further upside was capped given the actual lack of details and after Y/Y Chinese CPI and PPI remained in deflation.

Chinese Inflation - Chinese CPI YY (Apr) -0.1% vs. Exp. -0.1% (Prev. -0.1%); PPI YY (Apr) -2.7% vs. Exp. -2.8% (Prev. -2.5%); CPI MM (Apr) 0.1% (Prev. -0.4%). (Newswires)

CATL (300750 CH/3750 HK) - Chinese battery maker CATL has begun taking orders for its Hong Kong listing, aiming to raise up to HKD 41bln if the deal is upsized and the greenshoe option is exercised, potentially becoming the largest global listing of 2025, Bloomberg reports. CATL is planning to restrict US investors from participating in its Hong Kong IPO; it will conduct a Reg S offering, excluding US onshore investors, amid escalating US-China tensions, exempting CATL from certain US regulatory filing requirements.

Mazda Motor (7261 JT) - FY24/25 (JPY) net fell 45.1% Y/Y to JPY 114.1bln. (Newswires)

EUROPEAN CLOSES

CLOSES: DAX: +0.59 % at 23,489, FTSE 100: +0.26 % at 8,554, CAC 40: +0.64 % at 7,744, Euro Stoxx 50: +0.42 % at 5,311, AEX: +0.43 % at 906, IBEX 35: +0.40 % at 13,543, FTSE MIB: +0.98 % at 39,357, SMI: +0.20 % at 12,094, PSI: -0.52 % at 6,988

SECTORS: Energy 1.85%, Healthcare 0.87%, Materials 0.56%, Consumer Disc 0.54%, Telecoms 0.48%, Utilities 0.43%, Financials 0.38%, Consumer Stpl 0.20%, IT 0.01%, Industrials -0.18%

FTSE 100

Rio Tinto (RIO LN) - A US judge temporarily blocked the land transfer for Rio Tinto's Resolution Copper mine, citing Apache Stronghold’s likely success in its Supreme Court appeal. The project, opposed on religious grounds by Native Americans, would impact sacred land but is deemed vital for the energy transition, Reuters reports. (Reuters)

OTHER UK COMPANIES

Man Group Plc (EMG LN) - Man Group is in talks to acquire credit firm Bardin Hill Investment Partners, with a potential deal expected to be signed as soon as this month. Both companies declined to comment on the discussions. (Newswires)

BROKER MOVES

BP (BP/ LN) downgraded to Underweight from Equal Weight at Morgan Stanley

DAX

Evonik (EVK GY) - Q1 (EUR): Adj. EBITDA 560mln (exp. 543mln), Revenue 3.78bln (exp. 3.79bln). Notes of a further risk of economic slowdown in H2. (Newswires)

RWE (RWE GY) - Norway's Wealth Fund has revoked its exclusion of RWE, with the fund saying "We consider that the coal-fired power capacity is now below the absolute threshold specified in the coal criterion". (Newswires)

Salzgitter (SZG GY) - Q1 (EUR): External Sales 2.33bln, -13% Y/Y. EPS 0.66 (prev. 0.24 Y/Y). Confirms guidance. (Newswires)

OTHER GERMAN COMPANIES

Hypoport (HYQ GY) - Q1 (EUR): Revenue 159mln, +19% Y/Y, EBIT 8.6mln, +88% Y/Y. (Newswires)

ProSiebenSat.1 Media (PSM GY) - PPF announced an acquisition offer to increase its stake in the Co. to up to 29.99%. (Newswires)

BROKER MOVES

CAC

Danone (BN FP) - To acquire majority stake in US-based Kate Farms; no terms. (Newswires)

Technip Energies (TE FP) - Launched up to a EUR 45mln share buyback program to fulfil equity compensation plans, running through Dec 31st. (Newswires)

OTHER FRENCH COMPANIES

BROKER MOVES

TotalEnergies (TTE FP) upgraded to Overweight from Equal Weight at Morgan Stanley

PAN EUROPE

Trade - US President Trump said there was a very good meeting with China on Saturday and many things were discussed and much agreed to, while he stated a total reset was negotiated in a friendly but constructive manner. Trump also said they want to see for the good of both China and the US, an opening up of China to American business, as well as noted that great progress was made. Furthermore, Trump posted on Truth that his next TRUTH will be one of the most important and impactful he has ever issued. Chinese Vice Premier He Lifeng said trade talks were constructive and they made substantive progress, while both sides reached an important consensus and agreed to establish a China-US trade consultation mechanism with a joint statement to be issued on May 12th. Furthermore, He said the atmosphere was candid, in-depth and constructive, as well as noted that the nature of relations is mutual win-win, and they are going to provide more certainty and stability in the world economy.

Pharma - US President Trump pledged to slash US drug prices by 30-80%, introducing a "most favoured nation" policy to match the world’s lowest prices. He vowed to defy pharmaceutical industry resistance, despite prior failed attempts and lawsuits. Industry group PhRMA warned such price setting would harm patients and innovation.

Almirall (ALM SM) - Q1 (EUR): Sales 284.6mln (exp. 280mln), EBITDA 70.9mln (exp. 62mln). (Newswires)

Banco Sabadell (SAB SM), BBVA (BBVA SM) - Spain's government is open to a Banco Sabadell tie-up with another local bank as an alternative to an unsolicited BBVA bid, Bloomberg reports. The government would support a deal with a Spanish rival, though any agreement is unlikely to occur soon, according to sources cited. (Bloomberg)

Stellantis (STLAM IM/STLAP FP) - Co. is nearing the end of its search for a new CEO, Antonio Filosa emerging as leading candidate, according to Bloomberg. (Bloomberg)

UniCredit (UCG IM) - Q1 (EUR): Net Profit 2.77bln (Co. consensus 2.34bln), Total Revenue 6.55bln (Co. consensus 6.05bln); sees 2025 Net Profit above EUR 9.3bln; confirms FY25 ROTE above FY24. (Newswires)

BROKER MOVES

Repsol (REP SM) upgraded to Overweight from Equal Weight at Morgan Stanley

Proximus (PROX BB) upgraded to Hold from Reduce at HSBC

SMI

Nestle (NESN SW) - Co's US division will raise prices of its toll house morsels, baking cocoa and fudge kits starting June 23rd, according to Bloomberg. (Bloomberg)

OTHER SWISS COMPANIES

Clariant (CLN SW) - Co. received a claim for damages against four companies, incl. Clariant, which allegedly amounts to EUR 767mln. Clariant firmly rejects allegation. (Newswires)

BROKER MOVES

SCANDINAVIA

BROKER MOVES

Equinor (EQNR NO) downgraded to Equal Weight from Overweight at Morgan Stanley; MS analysts see oil markets to enter a surplus this summer and will weigh on earnings and buybacks.

US

CLOSES: SPX -0.07% at 5,660, NDX -0.01% at 20,061, DJI -0.29% at -0.29% at 41,249, RUT -0.16% at 2,023

SECTORS: Energy +1.05%, Real Estate +0.65%, Consumer Discretionary +0.63%, Materials +0.26%, Utilities +0.17%, Industrials +0.11%, Financials +0.03%, Technology 0.00% (unchanged), Consumer Staples -0.61%, Communication Services -0.62%, Health -1.10%.

Alphabet (GOOG) - Google will pay Texas USD 1.375bln to settle claims of unlawfully tracking users' private data, including geolocation, incognito searches, and biometric information. The settlement amount significantly exceeds other similar state settlements.

Eli Lilly (LLY) - Eli Lilly's SURMOUNT-5 trial for Zepbound showed superior results versus Wegovy at 72 weeks. Zepbound achieved a 20.2% weight reduction (50.3 lbs lost) vs. Novo Nordisk's (NVO) Wegovy 13.7% (33.1 lbs). Zepbound also led in secondary endpoints, with greater weight loss and waist circumference reduction.

Nvidia (NVDA) - NVIDIA is facing a challenging period, with product price hikes due to increased costs and regulatory challenges, DigiTimes reports. The company has raised prices across nearly all its products, including prices of GPU modules and servers such as H200/B200. Despite setbacks from the US-China AI chip export ban, demand for AI chips remains strong, and Nvidia's upcoming financial results are expected to be positive, the report adds. The company is also investing heavily in AI server manufacturing in the US.

OpenAI, Microsoft (MSFT) - OpenAI is renegotiating its partnership with Microsoft to secure a future IPO, revising terms on equity exchange for Microsoft's USD 13bln investment. The restructuring aims for a public benefit corporation model, balancing mission-driven goals with profit, amid rising competition and investor demands for equity, FT reports. (FT)

Shopify (SHOP), MongoDB (MDB) - Shopify will join the Nasdaq-100 Index and Nasdaq-100 Equal Weighted Index on May 19th, replacing MongoDB (MDB). Shopify will also replace MongoDB in several Nasdaq-100 Tech Sector indices, while MongoDB will be removed from those indices.

12 May 2025 - 06:51- Research Sheet- Source: Newsquawk