Newsquawk Daily European Equity Opening News - 18th July 2024

18th July 2024

ASIA

APAC stocks followed suit to the tech rout stateside owing to recent concerns of China tech curbs and tariff fears. ASX 200 was pressured by weakness in tech and telecoms but with downside cushioned after mixed jobs data which showed higher than expected employment change. Nikkei 225 underperformed amid recent currency strength and as large tech stocks suffered similar fates to their US counterparts amid the threat of tighter restrictions to supply China, while Japanese trade data showed exports and imports missed estimates. Hang Seng and Shanghai Comp. were mixed and ultimately rangebound with sentiment sapped by ongoing protectionist concerns.

TSMC (2330 TW/TSM) - Q2 (TWD): Sales 673bln (exp. 657bln), EPS 9.56 (exp. 9.04), Net 247.8bln (exp. 238.8bln), Capex 6.36bln (prev. 5.77bln), Gross Margin 53.2% (exp. 52.6%). Gross Profit 358bln (prev. 260bln). Operating Income 286bln (prev. 201bln). PBT 306bln (exp. 287bln). Shipments of 3-nanometer accounted for 15% of total wafer revenue; 5-nanometer accounted for 35%; 7-nanometer accounted for 17%. Advanced technologies, defined as 7-nanometer and more advanced technologies, accounted for 67% of total wafer revenue. (TSMC)

Samsung Electronics (005930 KS) - Co. is to launch AI-powered air conditioners in North America, according to Nikkei. (Nikkei)

EUROPEAN CLOSES

CLOSES: DAX: -0.40% at 18,444, FTSE 100: +0.28% at 8,187, CAC 40: -0.12% at 7,571, Euro Stoxx 50: -1.12% at 4,892, IBEX 35: +0.13% at 11,105, FTSE MIB: flat at 34,380, SMI: +0.56% at 12,330, PSI: -0.15% at 6,766, AEX: -1.81% at 917.

SECTORS: Consumer Stpl 1.37%, Energy 0.78%, Utilities 0.64%, Telecoms 0.40%, Financials 0.37%, Materials 0.19%, Healthcare -0.27%, Consumer Disc -0.29%, Industrials -1.22%, IT -5.99%

FTSE 100

OTHER UK COMPANIES

BROKER MOVES

Shell (SHEL LN) initiated with Peer Perform at Wolfe Research

BP (BP/ LN) initiated with Outperform at Wolfe Research

DAX

Volkswagen (VOW3 GY) - Co's Anhui officially launched its first new energy vehicle (NEV) for the Chinese market on Wednesday in Hefei, according to Xinhua. (Xinhua)

OTHER GERMAN COMPANIES

Auto1 (AG1 GY) – Successfully prices debut public market German consumer car loan ABS. (Newswires)

BROKER MOVES

CAC

Publicis (PUB FP) - H1 (EUR): Revenue 7.7bln, +7.7% Y/Y, EBIT 1.4bln, +4.9% Y/Y. Raises FY24 guidance. Net Revenue organic growth +5-6% (prev. guided +4-5%). (Newswires)

Renault (RNO FP) - Reported an increase in its overall sales in the first half of the year (+1.9%) to reach 1,154,700 vehicles sold; Electrified vehicles accounted for 29.6% of Renault Group sales in Europe (+4.3 points vs 2023). Co. said: In Europe, the Group consolidated its third place, selling 847,623 vehicles, an increase of 6.7% in a market that grew by 5.5%. The Renault brand is outperforming the market with 535,238 vehicles sold, a rise of 8.2% in a market that grew by 5.5%, the third brand in Europe and number one in France (PC+LCV). The growth in passenger cars is based on the very strong performance of full hybrid E-Tech engines (+45% vs. H1 2023). In the light commercial vehicle market, Renault is once again the leader with 171,202 sales (+19.2% vs. H1 2023). The Dacia brand sold 309,816 vehicles, a rise of 4.0% on H1 2023. It continues to rank among the top 10 best-selling brands in Europe. Sandero is the best-selling car across all channels. The Alpine brand reported 2,569 registrations in the first 2024, an increase of 47.7% on H1 2023, driven by the success of its extended range with A110 R Turini. (Renault)

Vinci (DG/ FP) – Won a contract to design, build and install electrical conversion platforms in the North Sea; contract worth a total of EUR 2.9bln. (Newswires)

OTHER FRENCH COMPANIES

Rubis (RUI FP) – Signed a master shelf facility subscription agreement for USD 246mln. (Newswires)

BROKER MOVES

TotalEnergies (TTE FP) initiated with Outperform at Wolfe Research

PAN EUROPE

Aluminium/Steel Names - US-listed Alcoa (AA) and Steel Dynamics (STLD) rose 0.7% and 2.3% respectively post earnings.

Chip names - TSMC reported a strong set of results, beating on top/bottom lines (details in the Asia section)

Bawag (BG AV) – Q2 (EUR): Net Profit 175mln (exp. 174mln). Confirms FY24 targets. (Newswires)

BROKER MOVES

SMI

Roche (ROGN SW) - Co's Vabysmo showed extended durability, continued efficacy and a consistent safety profile in long-term DME study; met all primary endpoints, showing safety data were consistent with Vabysmo's known safety profile. (Newswires)

Novartis (NOVN SW) - Q2 (USD): Sales 12.5bln (exp. 12.36bln), Operating Income 4.01bln (exp. 4.02bln), Net 3.24bln (exp. 3.76bln), EPS 1.97 (exp. 1.87). FY24 guidance raised for core operating income based on strong momentum: Core operating income expected to grow mid-to-high teens (prev. guided low double-digit to mid-teens). "Our guidance assumes that no Entresto generics and no Promacta generics launch in the US in 2024". As the Sandoz spin-off was completed on October 3, 2023, there were no operating results in the second quarter of 2024 related to discontinued operations. Q2 Growth Drivers: Entresto: 1.89bln (exp. 1.92bln), +28%; Kesimpta: 0.8bln, +65%; Cosentyx: 1.5bln (exp. 1.46bln), +22%; Kisqail: 0.7bln, +50%; Leqvio: 182mln, +134%; CEO: "We remain on track to achieve our mid-term sales growth (+5% cc CAGR 2023-2028) and margin (40%+ by 2027) guidance." (Novartis)

OTHER SWISS COMPANIES

ABB (ABBN SW) – Q2 (USD): Revenue 8.23bln (exp. 8.37bln), Net Income 1.09bln (exp. 1.04bln). Outlook 2024: Expect a positive book-to-bill, comparable revenue growth to be about 5% and op. EBITA margin to be about 18%. (Newswires)

Georg Fischer (GF SW) – H1 (CHF): Sales 2.40bln, +22.8% Y/Y, EBIT 220mln (prev. 184mln Y/Y). Continues to expect solid performance for 2024. (Newswires)

VAT (VACN SW) – Q2 (CHF): Sales 251.5mln (exp. 275mln). Confirms FY24 expectations. H1: Net Sales flat, EBITDA 135mln, +2% Y/Y. (Newswires)

BROKER MOVES

Zurich Insurance (ZURN SW) upgraded to Equal Weight from Underweight at Morgan Stanley

SCANDINAVIA

Essity (ESSITYB SS) – Q2 (SEK): Sales 36.61bln (exp. 36.5bln), EBITA 5.23bln (exp. 4.80bln). (Newswires)

Nokia (NOKIA FH) – Q2 (EUR): Sales 4.46bln (exp. 4.76bln), EBIT 432mln (exp. 369mln). Co. said the net sales recovery is happening somewhat later than we previously expected, impacting our business group net sales assumptions for 2024. FY24 outlook reiterated but warned that the market remains uncertain. Intends to accelerate ongoing EUR 600mln buyback program, view is to complete by year-end. Expects a significant acceleration in net sales growth in H2. (Newswires)

Telenor (TEL NO) – Q2 (NOK): Service Rev 16.3bln (Co. consensus 16.22bln), EBITDA 8.8bln (exp. 8.78bln). (Newswires)

Telia (TELIA SS) – Q2 (SEK): Sales 22.38bln (exp. 22.15bln), Adj. EBITDA 7.85bln (exp. 7.63bln). FY24 outlook unchanged. (Newswires)

Volvo Car (VOLCARB SS) - Q2 (SEK): Revenue 101.5bln (exp. 106.09bln, prev. 102.2bln Y/Y); EPS 1.79 (exp. 1.78, prev. 1.12 Y/Y); EBIT Margin 7.9% (prev. 4.9% Y/Y), Op. Income 7.97bln (exp. 6.57bln). (Newswires)

Volvo AB (VOLVB SS) – Q2 (SEK): Revenue 140.2bln (exp. 134.51bln), Income 15.58bln (prev. 10.81bln Y/Y). In Q2, deliveries of construction machines declined by 10% in total, impacted by lower deliveries in both Europe and North America. Order intake increased by 9% driven by North America and China. Sees 2024 European truck market of 290k units (prev. view 280k); Brazilian units 100k (prev. view 95k). (Newswires)

BROKER MOVES

US

CLOSES: SPX -1.39% at 5,588, NDX -2.94% at 19,799, DJIA +0.59% at 41, 198, RUT -1.06% at 2, 240

SECTORS: Technology -3.72%, Communication Services -2.09%, Consumer Discretionary -1.8%, Industrials -1.3%, Materials -0.2%, Utilities flat, Health +0.48%, Real Estate +0.8%, Financials +0.85%, Energy +1.08%, Consumer Staples +1.43%.

Alcoa (AA) - Q2 2024 (USD): Adj. EPS 0.16 (exp. 0.08), Revenue 2.906bln (exp. 2.84bln). EPS 0.11 (exp. 0.06).Adj. EBITDA 325mln (exp. 313.6mln). Aluminium production 543,000 mt, +0.2% Q/Q. Aluminium shipments 677,000 metric tons, +6.8% Q/Q. Alumina production 2.54mln mt, -4.9% Q/Q. Alumina third-party shipments 2.27mln mt -5.4% Q/Q. Alumina intersegment shipments 1.03mln mt, +8.6% Y/Y. (Newswires) Shares rose 0.7% after market.

Kinder Morgan Inc (KMI) - Q2 2024 (USD): Adj. EPS 0.25 (exp. 0.26), Revenue 3.57bln (exp. 4.12bln). Approves cash dividend of USD 0.2875/shr which is up 2% from a year ago. Maintains forecasts for FY adj. EBITDA USD 8.16bln (exp. 8.1bln). Maintains forecasts FY for dcf/share USD 2.26 (exp. 2.23). Co expects demand for natural gas to grow between now and 2030. (Newswires) Shares fell 2.3% after-market

Steel Dynamics Inc (STLD) Q2 2024 (USD): EPS 2.72 (exp. 2.67), Revenue 4.633bln (exp. 4.43bln). Gross profit 774.8mln. Net Income 431.69mln (exp. 452.4mln). EBT 565mln (exp. 619mln). EBIT 559mln (exp. 602mln). Adj. EBITDA 686mln (exp. 697mln). (Newswires) Shares rose 2.3% after market.

United Airlines Holdings Inc (UAL) - Q2 2024 (USD): Adj. EPS 4.14 (exp. 3.95), Revenue 15.0bln (exp. 15.1bln)Passenger revenue USD 13.68bln (exp. 13.74bln). Sees Q3 adj EPS USD 2.75-3.25 (exp. 3.38). Still forecasts FY adj EPS USD 9.00-11.00 (exp. 9.69). Sees FY adj. capex of less than USD 6.5bln (exp. 6.48bln). (Newswires) Shares fell 0.4% after market.

18 Jul 2024 - 06:53- Research Sheet- Source: Newsquawk