Newsquawk Daily European Equity Opening News - 1st February 2024

1st February 2024

ASIA

APAC stocks were mixed after the ladosses on Wall St owing to banking sector fears and Fed Chair Powell's pushback against a March rate cut, while Chinese Caixin Manufacturing PMI data topped forecasts.ASX 200 pulled back from record highs amid weakness in tech and financials, as well as softer data. Nikkei 225 retreated amid recent currency strength and with a slew of earnings influencing price action. Hang Seng and Shanghai Comp were mixed with early upside from stronger-than-expected Caixin PMI data and further support pledges although the gains were limited after the substantial PBoC liquidity drain and the mainland index gradually reversed course.

Alibaba (9988 HK) - Is said to weigh selling Intime in the latest overhaul step. (Newswires)

EUROPEAN CLOSES

CLOSES: DAX: -0.40% at 16,903.76, FTSE 100: -0.47% at 7,630.57, CAC 40: -0.27% at 7,656.75, Euro Stoxx 50: -0.35% at 4,646.45, IBEX 35: +0.38% at 10,077.70, FTSE MIB: +0.40% at 30,744.24, SMI: -0.95% at 11,334.00.

SECTORS: Healthcare -0.11%, Utilities -0.29%, Energy -0.65%, Consumer Stpl -0.68%, Industrials -1.14%, Financials -1.22%, Materials -1.27%, Consumer Disc -1.85%, IT -2.11%, Telecoms -3.93%

FTSE 100

OTHER UK COMPANIES

BROKER MOVES

Easyjet (EZJ LN) upgraded to Overweight from Neutral at JP Morgan

DAX

Adidas (ADS GY) - FY23 (EUR): Op 268mln (exp. 290mln; prev. 669mln), Revenue 21.43bln (exp. 21.5bln; prev. 22.51bln). FY24 currency-neutral sales growth view at a "mid-single-digit" rate. Decides not to write off most of its Yeezy inventory. FY24 Op view 500mln (exp. 1.27bln). Says unfavourable currency effects are projected to weigh significantly on the company's profitability in 2024. (Newswires) Index weightings: DAX 40 (2.6%), Euro Stoxx 50 (1%)

Deutsche Bank (DBK GY) Q4 (EUR): Revenue 6.658bln (exp. 6.783bln). FIC Sales & Trading Revenue 1.50bln (exp. 1.65bln); plans a EUR 675mln share buyback alongside a headcount cut of around 3,500. METRICS Corporate Bank (CB) 1.911bln (exp. 1.869bln). Investment Bank (IB) 1.837bln (exp. 2bln). Private Bank (PB) 2.395bln (exp. 2.315bln). Asset Management 580mln (exp. 635mln). Provisions for credit losses 488mln (prev. 351mln Y/Y). Deposits at year-end 2023 at 622mln (+EUR 11bln Q/Q); slightly above the level of year-end 2022. EUR 900mln in proposed dividends, EUR 0.45 per share, planned for 2023, up 50% over 2022. 2025 TARGETS ~EUR 32bln in revenues, with annual growth targets raised to 5.5%-6.5%. ~EUR 20bln in costs, with EUR 1.3bln savings from measures completed. Positioned to accelerate capital distributions; 2025 dividend guidance of EUR 1.00/shr, subject to a 50% payout ratio. OUTLOOK To be provided at the Annual Media Conference at 09:00 CET today. (Newswires) Index weightings: DAX 40 (1.8%)

Siemens Healthineers (SHL GY) – Q1 (EUR): Adj. EPS 0.49 (exp. 0.52), Revenue 5.176bln (exp. 5.485bln), FCF 238mln (prev. -77mln Y/Y), Net Income 432mln (exp. 570mln). (Newswires)

OTHER GERMAN COMPANIES

DWS (DWS GY) - FY23 (EUR): Pretax 937mln (exp. 845mln, prev. 1.06bln Y/Y), Revenue 2.60bln (exp. 2.584bln, prev. 2.68bln Y/Y). (Newswires)

Siltronic (WAF GY) - Q4 (EUR): EBITDA 91mln (exp. 93mln), Revenue 357mln (exp. 358mln, prev. 472.1mln Y/Y), EBIT margin 10% (prev. 26.4%). (Newswires)

BROKER MOVES

Puma (PUM GY) downgraded to Sector Perform from Outperform at RBC Shares -2% in pre-market trade following the downgrade and read-across from Adidas

CAC

BNP Paribas (BNP FP) - Q4 (EUR): Revenue 10.9bln (exp. 11.4bln). Net 1.07bln (exp. 2.0bln). Sees 2025 ROTE between +11.5-12% (prev. ~12%); announces EUR 1.05bln share buyback; Dividend +18% Y/Y. CET1 ratio 13.2% (exp. 13.3%). ROTE 10.7% (prev. 10.2% Y/Y). OUTLOOK: Affirms CET1 ratio, Net Income, EPS and Cost of Risk guidance. COMMENTARY: "BNP Paribas should continue to grow faster than its underlying economy and to gain market share..". "Personal Finance and Real Estate initiated in 2023 robust adaptation plans and should return to their nominal profitability as early as 2026" (BNP Paribas). Index weightings: CAC 40 (3.94%)

Dassault Systems (DSY FP) - Q4 (EUR): Non-IFRS EPS 0.36 (exp. 0.37), Revenue 1.64 (exp. 1.64). Guides Q1 EPS 0.29-0.30, Revenue 1.49-1.52bln, +7.8% Y/Y. Guides initial FY24 EPS 1.21-1.31, Revenue 6.35-6.43bln, +8-10% Y/Y. (Newswires) CAC 40 (1.5%)

Sanofi (SAN FP) - Q4 (EUR): EPS 1.66 (exp. 1.70), Revenue 10.9bln (exp. 11.4bln). Guides initial FY24 Business EPS "-4.5% to -3.5% Y/Y". Francois-Xavier Roger was appointed CFO and member of the executive committee. (Newswires) Index weightings: CAC 40 (6.8% - 3rd largest), Euro Stoxx 50 (3.7% - 5th largest)

OTHER FRENCH COMPANIES

BROKER MOVES

Safran (SAF FP) downgraded to Neutral from Buy at Goldman Sachs

PAN EUROPE

ASR Nederland (ASRNL NA) - BAWAG to acquire 100% of Knab from ASR for EUR 510mln at closing. (Newswires)

Banco Sabadell (SAB SM) - FY (EUR): Net Profit 1.33bln (exp. 1.26bln), NII 4.72bln (exp. 4.75bln), CET1 13.21% (exp. 13.68%). Proposes a supplementary cash dividend of 0.03/shr. FY24 Guidance: NII low single-digit growth, total cost of risk better Y/Y. (Newswires). (Newswires)

ING (INGA NA) - Q4 (EUR): Net Interest Income 3.88bln (exp. 4bln). Total Income 5.408bln (exp. 5.551bln). EBIT 2.247bln (exp. 2.638bln). Gross Result 2.333bln (prev. 1.980bln Y/Y). Customer Deposits 650bln (prev. 640.8bln Y/Y). CEO STATEMENT "In many respects, 2023 was a challenging year, as geopolitical and economic shocks affected many of our clients and the societies we operate in." "We're confident that we’ll be able to continue to deliver a sustained return on equity of 12% as economic indicators further stabilise...". (Newswires) Index weightings: AEX (6.2% - 5th largest), Euro Stoxx 50 (1.5%)

OMV (OMV AV) - Q4 (EUR): Net Income 0.66bln (exp. 0.54bln), Net Profit 1.5bln (exp. 1.45bln). FY24 Outlook: see Brent averaging USD 80/bbl, Nat Gas of EUR 25/MWh with a price between EUR 30-35/MWh. Base FY23 dividend of +10% Y/Y, special dividend also planned and will be announced at a later date. (Newswires)

Telecom Italia (TIT IM) - Italy's Treasury and KKR have agreed terms for Sparkle, TIM's submarine unit, according to Reuters citing sources. The sources add that the bid could be between EUR 700-800mln after the prior bid of EUR 600mln was rejected. (Reuters)

BROKER MOVES

Enel (ENEL IM) downgraded to Hold from Underperform at Jefferies

KPN (KPN NA) upgraded to Buy from Neutral at Citi

SMI

ABB (ABBN SW) - Q4 (USD) EPS 0.50 (exp. 0.47). Revenue 8.25bln (exp. 8.105bln). Net Income 921mln (exp. 872mln); Guides operating EBITDA margin to "slightly improve" in 2024 Y/Y; Raises dividend to CHF 0.87/shr (prev. CHF 0.84/shr); Plans share buyback. COMMENTARY: "In the projects- and systems business we expect continued high customer activity, although we face high comparables from last year when large orders came through at a very high level." "In total, order growth year-on-year should show stronger momentum in the latter part of the year when comparables ease." "We expect to improve on comparable revenues as well as on Operational EBITA margin, and cash flow should benefit from continued strong operational performance and our continued focus on net working capital efficiency." "We also plan to continue utilizing share buybacks as a tool to return excess cash to shareholders also during 2024." (Newswires) Index weightings: SMI (4.8%)

Baloise (BALN SW) - Optimising a run-off life insurance portfolio in Belgium by entering into a reinsurance transaction with RGA international. The portfolio comprises around 57k life insurance policies with reserves of some EUR 900mln. (Newswires)

Julius Baer (BAER SW) - FY (CHF): adj. Net Income 947mln (exp. 831mln), adj. EPS 4.61 (exp. 4.07), PBT 1.12bln (exp. 0.96bln), CET1 14.6% (exp. 17.03%). FY results reflect net credit losses of 606mln, which include a full specific loan loss allowance of 586mln for the largest private debt exposure which was disclosed in November. The dividend proposal is unchanged at 2.60/shr (exp. 2.61/shr), buyback will be considered later in 2024. To refocus all lending activity on mortgage/Lombard lending solutions. The CEO and five board members will not receive any variable compensation for 2023, CEO Rickenbacher is stepping down; Deputy Dreckmann appointed as interim CEO. (Newswires)

Roche (ROG SW) - FY (CHF): Net Income 12.35bln (exp. 14.67bln), Revenue 58.72bln (exp. 59.75bln), Core EPS 18.57 (exp. 18.56). Expects to further increase the dividend, proposing 9.60/shr (exp. 9.53/shr). FY (cont). Pharma Sales 44.6bln (44.8bln). Top-five growth drivers Sales 14.8bln, +4.3bln Y/Y. 2024 Sales rising in mid single-digit range. CEO "... exceeded our guidance for 2023. At the same time, the significant appreciation of the Swiss franc versus most currencies strongly impacted results when reported in Swiss francs. We also made good progress in both our pharma and diagnostics product pipeline." Index weightings: SMI (16.2%)

OTHER SWISS COMPANIES

SoftwareOne (SWON SW) - To acquire Medelsoft, no terms disclosed. (Newswires)

BROKER MOVES

Givaudan (GIVN SW) downgraded to Neutral from Outperform at Davy Research

Richemont (CFR SW) downgraded to Hold from Buy at HSBC

SCANDINAVIA

Indutrade (INDT SS) – Q4 (SEK): Pretax 874mln (exp. 838mln), Revenue 7.82bln (exp. 7.83bln). Order intake 8.04bln (exp. 7.43bln). Despite an uncertain macro environment situation, demand during the last quarter remained at a high level. (Newswires)

Novo Nordisk (NOVOB DC) -Says it is doubling the amount of lower dose strengths of Wegovy into the US market beginning in January 2024; overall demand will continue to exceed supply which means some patients may still have difficulty filling prescriptions. Expect it will take a couple of weeks for product to arrive in pharmacies. Gradually increasing overall supply thought-out the rest of the year. Plan to invest c. USD 6.5bln in production vs USD 3.6bln last year. (Newswires)

Volvo Cars (VOLCARB SS) - Q4 (SEK): EPS 1.04 (exp. 1.32, prev. 0.82 Y/Y), Op. Income 5.49bln (exp. 5.92bln), Revenue 109.4bln (exp. 106.7bln), Will no longer provide funding to Polestar and evaluating potential adjustments. (Newswires)

BROKER MOVES

US

CLOSES: SPX -1.61% at 4,845, NDX -1.94% at 17,137, DJIA -0.82% at 38,150, RUT -2.45% at 1,947.

SECTORS: Communication Services -3.93%, Technology -2.11%, Energy -1.9%, Consumer Discretionary -1.85%, Materials -1.27%, Financials -1.21%, Industrials -1.14%, Real Estate -0.71%, Consumer Staples -0.68%, Utilities -0.29%, Health -0.11%

Corteva (CTVA) - Gained 4.5% afterhours after Q4 profits topped expectations. Q4 EPS 0.15 (exp. 0.06), Q4 operating revenue USD 3.51bln (exp. 3.6bln). Management noted that stand-out performance of its Seed business, which drove results despite an ongoing imbalance in the global crop protection industry. Said overall agriculture fundamentals remain constructive, with record-setting demand for grain, oilseeds, meat and biofuels continuing into 2024. Sees FY24 operating EPS between USD 2.70-2.90 (exp. 3.01), and sees FY24 revenue between USD 17.4-17.7bln (exp. 17.6bln). Plans to repurchase around USD 1.0bln of shares in 2024. (Newswires) 

US Regional Banks - Moody's may cut New York Community Bancorp (NYCB) to junk with credit rating on review for a downgrade. Says: Rating action reflects NYCB's unanticipated loss content in NY office and multifamily properties, while rating action also reflects weak earnings and material decline in its capitalisation and high and growing reliance on wholesale funding.

Tesla (TSLA) - China offers CNY 8,000 cash discounts for some variations of Model Y vehicles. (Newswires)

Qualcomm (QCOM) - Extends licence agreement with Apple (AAPL) through March 2027, while Co. executive says expects Android revenues will be flat Q/Q. (Newswires)

01 Feb 2024 - 06:53- EnergyResearch Sheet- Source: Newsquawk