Newsquawk Daily European Equity Opening News - 16th July 2024

16th July 2024

ASIA

APAC stocks were mixed amid a quiet calendar and after the choppy but positive performance stateside following the latest comments from Fed Chair Powell. ASX 200 traded marginally lower with weakness in mining stocks following Rio Tinto's production update. Nikkei 225 gained on return from the holiday weekend with the upside helped by a weaker currency. Hang Seng and Shanghai Comp. were subdued with underperformance in the Hong Kong benchmark after it gapped beneath the psychologically key 18,000 level, while sentiment in the mainland was clouded amid the lingering risks of higher tariffs but with downside stemmed after the PBoC upped its liquidity efforts with a CNY 676bln injection through 7-day reverse repos.

Chinese Stocks - China may see a window to cut its interest rates or RRR at end-Q3 or in Q4 to support its economy, according to analysts cited by Shanghai Securities News. (Shanghai Securities News) Separately, former President Trump's running mate J.D. Vance said China is a bigger issue for the US than the Russia-Ukraine war. (Newswires)

Samsung Electronics (005930 KS) - Completed verification of 10.7 gigabit-per-second LPDDR5X DRAM for MediaTek (2454 TT), while the chip is the industry's fastest with improvement of over 25% in power consumption and performance vs prev. generation. (Newswires)

EUROPEAN CLOSES

CLOSES: Euro Stoxx 50 -1.22% at 4982, DAX -0.79% at 18581, CAC 40 -1.19% at 7619, FTSE 100 -0.85% at 8175, SMI -0.58% at 12279, FTSE MIB -0.59% at 34330, IBEX 35 -0.96% at 11143, PSI -1.55% at 6706, AEX -0.79% at 937.

SECTORS: Telecoms -0.40%, Energy -0.48%, Financials -0.52%, Industrials -0.94%, Healthcare -0.94%, IT -1.00%, Materials -1.45%, Consumer Stpl -1.48%, Consumer Disc -1.75%, Utilities -1.96%

FTSE 100

Rio Tinto (RIO LN) - Quarterly Pilbara iron ore output fell 2% Y/Y to 79.5mln tons, iron ore shipments rose 2% Y/Y to 80.3mln tons, mined copper rose 18% Y/Y to 171k tons, aluminium output rose 1% Y/Y to 824k tons. Co. says expectations for 2024 Pilbara iron ore shipments remain at 323mln-338mln tons, and expectations for 2024 alumina production lowered to 7.0mln-7.3mln tons. Rio Tinto said all conditions have now been satisfied for Co's investment to develop the Simandou high-grade iron ore deposit in Guinea. Elsewhere, it has initiated a "coordinated shutdown" at the Iron Ore Company of Canada in Newfoundland and Labrador. (Newswires)

OTHER UK COMPANIES

BROKER MOVES

Airtel Africa (AAF LN) upgraded to Overweight from Neutral at JP Morgan

DAX

OTHER GERMAN COMPANIES

Aixtron (AIXA GY) - Nexperia partners with Aixtron for 200MM SIC and Gan Power. (Newswires)

Hugo Boss (BOSS GY) - Co. downgrades its FY24 outlook and now expects Group sales to increase by +1% to +4% (prev. +3% to 6%) to EUR 4.20-4.35bln (prev. EUR 4.30-4.45bln). FY EBIT is now seen between EUR 350-430mln (prev. 430-475mln). Co. said "headwinds contributed to a further slowdown of industry growth, affecting the top- and bottom-line performance of HUGO BOSS in the second quarter. The overall market environment remained particularly challenging in key markets such as the UK and China." Q2: Sales 1.1bln (exp. 1.03bln), -1% Y/Y. Q2 Performance by region: Americas (+5%), EMEA (-2%), and Asia/Pacific (-4%). From a balance sheet perspective, Co. further improved its cash position, with FCF at EUR 143mln (prev. 60mln). Co. statement said, "We have the ability to return to profitable growth in the second half." Full results are due on August 1st 2024. (Hugo Boss) Shares -6% in pre-market trade

BROKER MOVES

CAC

Eurofins Scientific (ERF FP) – SGS said despite both party's efforts not all closing conditions were satisfied by the agreed long stop date. Eurofins remains committed to following through on its acquisition of Crop Science. (Newswires)

Kering (KER FP) – Appoints Ewa Abrams as President of Kering Americas. (Newswires)

OTHER FRENCH COMPANIES

Scor (SCR FP) – Q2 (EUR): L&H Insurance result expected at -0.4bln. Adjustments have no impact on liquidity position at year-end. L&H ISR in 2024 is expected to be significantly less than EUR 500mln indicated in Q1’24. Final assumption updates in H2 could potentially lead to a negatively adjustment to L&H ISR of up to EUR -0.1bln by the end 2024. (Newswires)

BROKER MOVES

PAN EUROPE

argenx (ARGX NA) – Co. and Zai Lab announce the approval of Efgartimod Alfa injection for generalised Myasthenia Gravis in China. (Newswires)

EDPR (EDPR PL) – Achieved 30% load factor in End-June. H1 electricity generation +5% at 18,893 GWH. (Newswires)

Luxury Sector - Attention falls on the luxury sector once again after Hugo Boss (BOSS GY) and Richemont (CFR SW) echoed the APAC demand weakness flagged by Swatch (UHR SW) and Burberry (BRBY LN) yesterday.

Pirelli (PIRC IM) - Fitch ratings raise the rating to BBB from BBB-. (Newswires)

TotalEnergies (TTE FP)/SSE (SSE LN) - Cos partner to create a JV named "Source" which will deploy and operate up to 3,000 fast-charging points in the next five years. (Newswires)

BROKER MOVES

SMI

Richemont (CFR SW) Q1 (EUR): Sales 5.27bln (exp. 5.28bln). APAC Revenue -18% (exp. -15.1%); China/Hong Kong/Macau sales -27%, Europe Revenue +5% (exp. +4.83%), Americas +10%. The decline in China/Hong Kong/ Macau "reflected both the low level of consumer confidence and the strong comparatives ranging from double-digit growth in the mainland to triple digits in Hong Kong and Macau over the prior-year period." "In Europe, sales increased by 5%, driven by resilient local demand and stronger tourist purchases." "In the Americas, the 10% sales progression reflected sustained domestic demand across all distribution channels."

OTHER SWISS COMPANIES

DKSH (DKSH SW) – H1 (CHF): Core EBIT 163.6mln, +8.2% Y/Y, Net Sales 5.4bln, +3.3% Y/Y. Confirmed FY24 outlook. (Newswires)

BROKER MOVES

SCANDINAVIA

Elisa (ELISA FH) - Q2 (EUR): Pretax profit 114mln (exp. 114.5mln), EBITDA 190mln (exp. 189.5mln), Revenue 541mln (exp. 537.1mln). FY comparable EBITDA is anticipated to be at the same level as or slightly higher than in 2023. (Newswires)

SEB (SEBA SS) – Q2 (SEK): Net Profit 9.4bln (exp. 9.7bln), CET1 Ratio 19% (exp. 19.1%), RoE 17.6%. To initiate a new SEK 2.5bln buyback programme of Class A Shares. (Newswires)

Swedbank (SWEDA SS) – Q2 (SEK): Net Profit 8.59bn (Co. consensus 8bln), Pretax profit 10.98bln (exp. 9.95bln), NII 12.16bln (exp. 12.22bln). Economic conditions in four home markets continued to stabilise. Next year, growth in all our four home markets is expected to be higher than in other European countries. (Newswires)

BROKER MOVES

Gjensidige Forsikring (GJF NO) downgraded to Sell from Hold at Berenberg

US

CLOSES: SPX +0.28% at 5,631, NDX +0.27% at 20,386, DJI +0.53% at 40,211, RUT +1.71% at 2,184.

SECTORS: Energy +1.56%, Financials +1.42%, Industrials +0.70%, Technology +0.41%, Real Estate +0.40%, Communication Services +0.32%, Materials -0.30%, Consumer Discretionary -0.31%, Health -0.43%, Consumer Staples -0.60%, Utilities -2.39%

General Motors (GM) - CEO Barra says 1mln EV target won't be hit, according to CNBC. (CNBC)

US Property - US President Biden will reportedly unveil a new proposal in Nevada on Tuesday to cap rental costs nationwide, according to WaPo citing sources. "Biden’s plan — which would need to be approved by Congress — calls for stripping a tax benefit from landlords who increase their tenants’ rent more than 5 percent per year", the sources said. "The measure would only apply to landlords who own more than 50 units, which represents roughly half of all rental properties, the people said". "It wouldn’t cover units that have not yet been built, in an attempt to ensure that the policy does not discourage construction of new rental housing". (Washington Post)

16 Jul 2024 - 06:50- Research Sheet- Source: Newsquawk

EuropeBOSS.GYEURHugo Boss AGPresidentRio Tinto PLCIron OreCFRDAX 40 IndexFTSE 100 IndexKeringSSE.LNBRBY.LNSWEDA.SSCNBC.USSCR.FPGM.USKER.FPRIO.LNGJF.NOAIXA.GY2454.TT005930.KSSEBA.SSEDPR.PLERF.FPChinaUnited StatesStaples IncGeneral Motors CoGMBRBYFederal ReservePBoCMediaTek IncTTAEX 25 IndexITRIOCopperAluminiumAAFJPMorgan Chase & CoGermanyERFSGS SAKERFranceInsuranceSwatch Group AG/TheBurberry Group PLCTTESSEConsumer ConfidenceCore CorpSEB SAUSD/SEKS&P 500 IndexNASDAQ 100 IndexUnited KingdomHong KongEU SessionResearch SheetHighlightedAsian SessionEU SessionHighlightedResearch SheetAsian SessionAsiaSCRAfricaCanadaCNYCHF

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