Newsquawk Daily European Equity Opening News - 21st June 2023

21st June 2023

ASIA

APAC stocks were mostly subdued following the negative handover from Wall St amid the lack of bullish macro drivers and as participants look ahead to Fed Chair Powell's testimony in Congress. ASX 200 was dragged lower by weakness in the commodity-related sectors and with the mood not helped by the deterioration in the Australian Westpac Leading Index. Nikkei 225 was initially pressured but then clawed back losses with SoftBank among the biggest gainers during its AGM where CEO Son noted that AI is about to grow explosively and the time has come to shift to offence mode, while there were also comments from BoJ’s Adachi who stuck to the dovish script. Hang Seng and Shanghai Comp. were lower with Hong Kong underperforming on tech losses and as sentiment in the mainland remained dampened by the weaker outlook with HSBC cutting China's GDP forecast to 5.3% from 6.3%, while the PBoC’s continued liquidity efforts and the recent US-China rhetoric did little to spur risk appetite.

SoftBank (9984 JT) - CEO Son said AI is about to grow explosively and we are getting prepared for such an era, while he adds that the time has come to shift to offense mode. (Newswires)

EUROPEAN CLOSES

CLOSES: Euro Stoxx 50 -0.44% at 4,343, FTSE 100 -0.25% at 7,569, DAX 40 -0.55% at 16,111, CAC 40 -0.27% at 7,294, FTSE MIB -0.64% at 27,576, IBEX 35 +0.08% at 9,439, SMI -0.72% at 11,225.

SECTORS: Utilities 0.70%, Healthcare -0.07%, Consumer Stpl -0.29%, Financials -0.59%, Industrials -0.61%, Telecoms -0.64%, IT -0.78%, Consumer Disc -1.12%, Materials -1.29%, Energy -1.52%

FTSE 100

Antofagasta (ANTO LN) - Reportedly Zaldivar presents plant to extend operations to 2051, according to Reuters sources. (Newswires)

Insurance Names - Financials Acquisition Corp (FINSAC), a special purpose acquisition companies (SPACs), is to reportedly establish a GBP 1bln listed vehicle for investors to access the Lloyd's of London insurance market, according to Sky News sources. The announcement will likely be made on Wednesday morning, according to sources. (Sky News)

Rio Tinto (RIO LN) - Co. reopened Western Australia iron ore rail mine following the derailment on Saturday. (Newswires)

UK Banks – UK Chancellor Hunt has called for a meeting with bank heads to discuss the mortgage crisis due to worries many borrowers are at risk of defaulting on mortgage repayments, according to The Telegraph. (Telegraph)

OTHER UK COMPANIES

BROKER MOVES

Lloyds Banking Group (LLOY LN) downgraded to Neutral from Outperform at BNP Paribas

Metro Bank (MTRO LN) downgraded to Underperform from Neutral at BNP Paribas

NatWest Group (NWG LN) downgraded to Underperform from Neutral at BNP Paribas

St. James Place PLC (STJ LN) raised to Overweight from Equal weight at Barclays

DAX

Deutsche Telekom (DTE GY) - T-Mobile (TMUS) CFO expects Q2 phone subscribers of roughly 700k (exp. 664k). (Newswires) Note, Deutsche Telekom has a 50.4% stake in T-Mobile.

OTHER GERMAN COMPANIES

Deutsche Lufthansa (LHA GY) - The Co. sold payment specialist Airplus to SEB (SEBA SS) for cash price of EUR 450mln; Expected to have positive impact on the Co. operating margin. (Newswires)

Qiagen (QIA GY) - FBI approves Qiagen's NGS-based ForenSeq MainstAY workflow for the US National DNA System. (Newswires)

BROKER MOVES

Lanxess (LXS GY) downgraded to Hold from Buy at Jefferies

CAC

OTHER FRENCH COMPANIES

BROKER MOVES

PAN EUROPE

Eni (ENI IM) - Co. is reportedly said to be near a USD 5bln deal for Neptune, could be announced as soon as this week, according to Bloomberg citing sources. (Newswires); According to reports, EIP is among the interested parties in the Co's talks to sell stake in Plentitude, its renewable unit. (Newswires)

Postal Names - FedEx (FDX) shares fell 3.1% after-market after missing on revenue expectations and citing continued demand weakness and cost inflation.

Saipem (SPM IM) - New credit lines totally EUR 860mln became effective as of today. (Newswires)

BROKER MOVES

SMI

Credit Suisse (CSGN SW) – Co’s lawsuit against Softbank (9984 JT) has reportedly been thrown into doubt following UBS’ (UBSG SW) takeover of Credit Suisse – with Softbank being one of UBS’ clients, according to FT sources. (FT)

OTHER SWISS COMPANIES

BROKER MOVES

SCANDINAVIA

Pandora (PNDORA DC) - Initiates new DKK 2.6bln share buyback, which to reach up to DKK 5.0bln in total, effective from June 21st. Purpose of programme is to reduce company's share capital and to meet its obligations arising from company incentive programmes. (Newswires)

BROKER MOVES

Evolution AB (EVO SS) initiated with Neutral at JPMorgan Chase

US

CLOSES: SPX -0.47% at 4,389, NDX -0.09% at 15,070, DJIA -0.72% at 34,054, RUT -0.47% at 1,867

SECTORS: Energy -2.29%, Materials -1.26%, Utilities -1.17%, Real Estate -1.11%, Industrials -0.76%, Cons Stpl -0.75%, Financials -0.69%, Technology -0.44%, Communication Svs -0.29%, Health -0.15%, Cons Disc +0.75%.

FedEx Corp (FDX) - Q4 2023 (USD): EPS 4.94 (exp. 4.89), Revenue 21.90bln (exp. 22.67bln), Co. says quarterly results were negatively affected by continued demand weakness and cost inflation. Operating results in the quarter fell from lower global volumes, partially offset by decreased expenses and higher US domestic yields. FedEx Express continues to implement volume-related and structural cost-reduction actions, including further reductions in flight hours and the early retirement of certain aircraft and related assets, to mitigate the negative effect of ongoing demand weakness. FedEx Ground operating results improved primarily due to higher revenue per package and cost-reduction actions. These factors were partially offset by lower package volume, higher infrastructure costs and increased other operating expenses. FedEx Freight operating results declined primarily due to decreased shipments and lower weight per shipment, partially offset by improved revenue quality. FedEx Freight remains focused on cost discipline, supported by a fourth round of furloughs to match staffing with demand and network optimization from the planned permanent closure of 29 facilities. Co. CFO Lenz is to retire effective July 31st. Sees FY 2024 Adj. EPS USD 16.50-18.50 (exp. 18.31). Sees FY revenue growth of flat to low-single-digit percentage (exp. +0.3%). Sees 2024 CAPEX at about USD 5.7bln (exp. 5.98bln). CFO says freight margins will be down for the year and will be most pronounced in Q1. CEO says expects demand challenges from June through to November this year, adds headcount is down around 29k for FY23 which exceeds the internal target. (Buisinesswire/Newswires) Shares fell 3.1% after-market

T-Mobile (TMUS) - Expects Q2 subscribers of 700k, according to BofA conference comments. (Newswires)

21 Jun 2023 - 06:45- Research Sheet- Source: Newsquawk