Newsquawk Daily European Equity Opening News

20th October 2023

ASIA

APAC stocks mostly declined after the losses on Wall St where the curve steepened as markets digested various comments from Fed Chair Powell and with sentiment pressured by the escalating geopolitical situation. ASX 200 was dragged lower with broad weakness seen across all sectors aside from energy which is kept afloat by the geopolitical risk premium uplift in oil prices. Nikkei 225 retreated at the open but then gradually pared its losses amid reports of potential temporary income tax cuts and with participants also digesting the latest Japanese CPI data which printed mostly firmer than expected but softened from the previous month’s pace. Hang Seng and Shanghai Comp. were subdued albeit with the downside cushioned after the PBoC’s actions in which it unsurprisingly maintained its benchmark lending rates but boosted liquidity in the interbank market with its largest-ever open market operation net daily injection.

Evergrande (3333 HK) - Co. said it is revising the terms of its proposed restructuring to meet the company's objective situation and demand of creditors. (Newswires)

EUROPEAN CLOSES

CLOSES: DAX -0.33% at 15,045.23, FTSE 100 -1.17% at 7,499.53, CAC 40 -0.64% at 6,921.37, Euro Stoxx 50 -0.39% at 4,090.05, IBEX 35 -0.72% at 9,146.80, FTSE MIB -1.38% at 27,746.82, SMI -2.15% at 10,445.60.

SECTORS: IT 1.15%, Utilities -0.06%, Materials -0.94%, Energy -0.98%, Consumer Disc -1.04%, Consumer Stpl -1.04%, Financials -1.10%, Industrials -1.23%, Telecoms -1.51%, Healthcare -2.80%

FTSE 100

London Stock Exchange (LSEG LN) - Co. said the issue with the exchange has been resolved after it investigated an incident whereby only FTSE 100, FTSE 250 and IOB securities were available for trading. (Newswires)

OTHER UK COMPANIES

BROKER MOVES

HSBC (HSBA LN) downgraded to Market Perform at Keefe Bruyette

DAX

OTHER GERMAN COMPANIES

Duerr (DUE GY) - Co. downgraded FY24 EBIT margin to 4.5-6.0% (prev. 8%) with sales growth seen between 5 to 10%. "The reason for this is the continued downturn in the markets of the Group’s subsidiary HOMAG...Despite the retraction for 2024, the Dürr Group continues to target an EBIT margin before extraordinary effects of 8%. From today’s perspective, it is likely to be achieved in 2026 at the earliest if business at HOMAG recovers accordingly." (Duerr)

Metro AG (B4B GY) - Prelim. Q4 2023 (EUR): Sales 7.9bln (prev. 8bln Y/Y); prelim FY sales 30.6bln (prev. 29.8bln Y/Y); FY adj. EBITDA is expected to be in the lower half of the guidance range and the outlook for next FY remains challenging. (Newswires) Shares seen opening -2.4%.

BROKER MOVES

CAC

Air Liquide (AI FP) - Air Liquide is a partner in six out of seven Hydrogen Hubs announced by the DOE in the US. (Air Liquide)

EssilorLuxottica (EL FP) - Q3 2023 (EUR): Revenue 6.29bln (exp. 6.3bln). Revenue growth 5.2% (exp. 4.7%). Co. confirms its long-term outlook. "The third quarter was in slight deceleration compared to the first half due to a weaker sun retail business now also affecting the EMEA region on top of North America, and a tougher comparison base in Asia-Pacific". Co. holds a 3.2% weighting in the CAC 40 and a 1.7% weighting in the Euro Stoxx 50

L'Oreal (OR FP) - Q3 2023 (EUR): Revenue 10bln (exp. 9.97bln), +11.1% LFL, North Asia revenue 2.05bln, -4.8% LFL; 9-month: Revenue 30.57bln, +12.6% LFL. Q3 North Asia comp sales -4.8% (exp. +14.4%). Europe +17.6% LFL and +15.3% reported. COMMENTARY: Growth in all divisions with very strong performance of the L’Oréal Dermatological Beauty and Consumer Products Divisions. Double-digit growth in all regions, except North Asia, where strong market outperformance in mainland China and Japan was offset by the reset in Travel Retail. Particularly impressive performance in Europe and emerging markets. (L'Oreal IR) Co. holds a 5.8% weighting in the CAC 40 and a 3.2% weighting in the Euro Stoxx 50

Vivendi (VIV FP) - Q3 2023 (EUR): Revenue 2.426bln (prev. 2.58bln Y/Y). Canal Plus revenue 1.50bln (exp. 1.47bln). All divisions increased. Acquisitions continued at a rapid pace. A partnership was formed with Mirakl in retail media, and a partnership with Adobe for AI was extended. Co. said the transaction with Lagardere (MMB FP) should be finalised before year-end. (Newswires/Vivendi)

OTHER FRENCH COMPANIES

Covovio (COV FP) - 9M (EUR): Revenue 484.4mln (prev. 471mln). Co. affirms its FY23 EPRA guidance at 420mln. Co. noted continued strong rental momentum across all businesses. 2023 guidance confirmed. (Newswires)

Forvia (FRVIA FP) – Q3 (EUR): Sales 6.53bln (exp. 6.48bln). FY23 guidance confirmed. Launch of an additional 1bln disposal program to accelerate deleveraging beyond Power25. UAW strike within the US was of very limited impact in Q3 with circa. EUR 6mln of lost sales, the estimate for October is circa. EUR 55mln. (Newswires)

Rexel (RXL FP) – Q3 (EUR): Sales 4.6bln (exp. 4.6bln). 2023 objectives confirmed, on track to attain 2025 ambitions. The strategic roadmap will be presented in June 2024. (Newswires)

BROKER MOVES

PAN EUROPE

Brunello Cucinelli (BC IM) - 9M (EUR): Revenue 818mln (prev. 642mln). Co. raises its FY23 revenue guidance to between +20-22% (prev. +17-19%). (Newswires)

Oil Names - Crude futures continued to edge higher overnight after surging post-settlement amid the escalating geopolitical situation in the Middle East.

European Steel Names - US and EU reportedly stall on a steel accord, risking a return of tariffs; both sides are seeking a deal to avoid the return of Trump-era levies, according to Bloomberg. (Newswires)

Salvator Ferragamo (SFER IM) - 9M (EUR): Revenue 844mln (prev. 921mln Y/Y). "Whilst the wider market environment is increasingly uncertain, our mid-term ambition is confirmed.” CEO does not see potential for major improvements for sales growth in the near term and added that the main challenges are the macro environment and geopolitical tensions. (Newswires/Salvator Ferragamo)

BROKER MOVES

ASML (ASML NA) reiterated with Buy at Jefferies

BBVA (BBVA SM) upgraded to Overweight from Equal Weight at Barclays

KBC (KBC BB) downgraded to Hold from Buy at Deutsche Bank

Telefonica (TEF SM) downgraded to Reduce from Hold at HSBC

SMI

Sika (SIKA SW) - 9M (CHF): Revenue 8.45bln (exp. 8.55bln). Net 736.5mln (prev. 885.9mln Y/Y). EBIT 1.14bln (prev. 1.23bln). Adj. EBIT margin 14.8% (prev. 13.8%). Co. affirms FY23 revenue and EBIT guidance. (Newswires)

UBS (UBSG SW) - Co. is said to be preparing for the next wave of job cuts, with the group reportedly eyeing 10% of support staff, likely in financial news, risk and marketing, and compliance, according to Bloomberg citing Financial News. (Bloomberg)

OTHER SWISS COMPANIES

BROKER MOVES

SCANDINAVIA

Husqvarna (HUSQB SS) - Q3 (SEK): Sales 10.5bln (exp. 11.7bln), EBIT 0.4bln (exp. 0.45bln), adj. EBIT 415mln (exp. -0.223mln). Experienced a weaker market situation with lower end user demand during Q3. (Newswires)

BROKER MOVES

Elisa (ELISA FH) upgraded to Accumulate from Reduce at Inderes

Nokia (NOKIA FH) downgraded to Reduce from Accumulate at Inderes

US

CLOSES: SPX -0.85% at 4,277, NDX -0.85% at 14,783, DJIA -0.75% at 33,414, RUT -1.51% at 1,702.

SECTORS: Real Estate -2.44%, Consumer Discretionary -2.2%, Financials -1.25%, Materials -1.08%, Health -0.96%, Utilities -0.93%, Industrials -0.9%, Consumer Staples -0.78%, Technology -0.44%, Energy -0.13%, Communication Services +0.32%.

Hewlett Packard Enterprise (HPE) - FY24 adj. EPS view 1.82-2.02 (exp. 2.14), according to analyst meeting. (Newswires) HPE shares fell 4.8% after market.

Tesla (TSLA) - Co. raised prices for all-wheel drive Model X Plaid by 5.5%. (Newswires)

20 Oct 2023 - 06:45- Research Sheet- Source: Newsquawk