Newsquawk Daily European Equity Opening News - 23rd July 2024

23rd July 2024

ASIA

APAC stocks were mixed and only partially sustained the momentum from the tech-led rebound on Wall St ahead of key data releases and big-tech earnings as sentiment clouded by ongoing China woes. ASX 200 was underpinned with tech stocks inspired by the outperformance of the sector stateside, while energy suffered due to recent declines in oil prices and with pressure in Woodside Energy after a mixed quarterly update. Nikkei 225 boosted at the open although has since pared the majority of the gains amid a firmer currency and after a recent source report suggested indecision regarding rates at next week’s BoJ meeting. Hang Seng and Shanghai Comp. were subdued in which the latter remained the laggard as the PBoC’s recent short-term funding rate cuts and liquidity boost via 7-day reverse repos, left the market wanting more.

Woodside Energy (WDS AT) - Quarterly output 44.4mln BOE (prev. 44.9mln BOE Q/Q), sales volume 48.0mln BOE (prev. 45.9mln BOE Q/Q), rev. USD 3.03bln, Co. FY production guidance remains unchanged and it sees ongoing demand for its LNG in Asian markets. (Newswires)

EUROPEAN CLOSES

CLOSES: DAX: +1.35% at 18,417, FTSE 100: +0.53% at 8,199, CAC 40: +1.16% at 7,622, Euro Stoxx 50: +1.44% at 4,897, AEX: +1.06% at 917, IBEX 35: +0.51% at 11,144, FTSE MIB: +1.17% at 34,615, SMI: +0.95% at 12,287, PSI: +0.85% at 6,860.

SECTORS: IT 1.90%, Financials 1.21%, Industrials 0.99%, Healthcare 0.94%, Materials 0.91%, Consumer Disc 0.82%, Consumer Stpl 0.65%, Telecoms 0.17%, Energy 0.11%, Utilities -0.06%

FTSE 100

BP (BP/ LN) – BP and Venezuela’s PDVSA are in negotiations for a Venezuelan licenses to develop natural gas deposit in the Caribbean Sea, according to Reuters citing sources. (Reuters)

IAG (IAG LN)- Co. has committed to purchasing GenX (GE) engines to power six new 787 Dreamliners for British Airways. Japan Airlines signs deal for GenX to power new 787s. Turkish Airlines and GE Aerospace (GE) announced an agreement for eight GE90-110B engines and services to power the Boeing (BA) 777 Freighter cargo fleet. (Newswires)

OTHER UK COMPANIES

DS Smith (SMDS LN) – Brazil’s Suzano (SUZB3 BR) is looking for new deals to expand its production after the International Paper (IP) deal fell through, via Reuters. (Reuters)

BROKER MOVES

Rio Tinto (RIO LN) upgraded to Buy from Hold at HSBC

Unilever (ULVR LN) initiated with Buy at TD Cowen

DAX

Bayer (BAYN GY) – Heads to trial in US antitrust lawsuit over flea and tick medication, after a Petcare startup claimed the Co. tried block competition for the treatments. (Newswires)

SAP (SAP GY) - Q2 2024 (EUR): Adj. EPS 1.10 (exp. 1.07), Revenue 8.29bln (exp. 8.25bln) - as AI demand boosts growth. Non-IFRS cloud and software revenue EUR 7.18bln (exp. 7.19bln). Non-IFRS cloud revenue EUR 4.155bln (exp. 4.16bln). Free cash flow EUR 1.29bln (exp. 286.1mln). Reiterates 2024 outlook: Sees FY cloud revenue in constant currencies at EUR 17.0bln-17.3bln (exp. 17.13bln). Sees FY non-IFRS oper. profit in constant currencies at EUR 7.6bln-7.9bln (exp. 6.53bln). Sees FY Cloud and software rev. in constant currencies at EUR 29.0bln-29.5bln (exp. 29.61bln). (PR Newswire) Index Weightings: DAX 40: 12.9% (largest), Euro Stoxx 50: 5.2% (third largest), Stoxx 600 (1.7%). SAP ADR (SAP) rose 4.3% after-market. Shares +4% in pre-market trade.

Porsche AG (P911 GY) – Lowers guidance: sees FY Sales Revenue 39-40bln (prev. guided 40-42bln), Sees FY automotive EBITDA margin 23-24% (prev. guided 24-26%), Sees FY automative BEV share 12-13% (prev. guided 13-15%). Co. said it is becoming apparent that the impending supply shortage will lead to impairments in production, and it is expected that resulting delays in production and delivery of vehicles will not be fully compensated for in further course of FY. (Newswires)

OTHER GERMAN COMPANIES

Hella (HLE GY) – H1 (EUR): Sales 4.06bln, +1.6% Y/Y. Confirms FY24 outlook. (Newswires)

BROKER MOVES

CAC

Edenred (EDEN FP) – H1 (EUR): Revenue 1.4bln (exp. 1.39bln), EBITDA 597mln (exp. 588mln). Outlook forecast 2024: EBITDA 1.23-1.3bln. (Newswires)

LVMH (MC FP) – L Catterton, a private equity firm backed by LVMH, has made an approach for US toy maker Mattel (MAT), via Reuters citing sources. (Reuters) Note, earnings are due after the European market closes today.

OTHER FRENCH COMPANIES

JC Decaux (DEC FP) – JC Decaux Macau renews and extends its exclusive advertising contract with Macau International Airport. (Newswires)

BROKER MOVES

PAN EUROPE

European Steel Names - Nucor (NUE) shares fell 0.8% after-market despite beating on top and bottom lines as the Co. warned it expect earnings in Q3 2024 to decrease vs. Q2 2024, and sees a decrease in earnings of steel mills segment, primarily due to lower average selling prices.

Chip Names - NXP Semiconductors (NXPI) shares fell 7.8% as the Co. forecasts lower Q3 revenue amid sluggish demand from automotive customers.

Sabadell (SAB SM) – Q2 (EUR): NII 1.26bln (exp. 1.23bln), Net profit 483mln (exp. 418mln). To pay a first interim cash dividend of 0.8/shr in Oct. Revision of NII guidance to mid-single digit growth in 2024. Sees NII in 2025 to be higher than in 2024. (Newswires)

BROKER MOVES

SMI

Givaudan (GIVN SW) – H1 (CHF): Revenue 3.7bln (exp. 3.7bln), Net Income 588mln (exp. 533mln). (Newswires)

Kuehne und Nagel International (KNIN SW) – Q2 (CHF): Revenue 6.04bln (exp. 6.19bln), EBIT 402mln (exp. 410mln). (Newswires)

Logitech International (LOGN SW) - Q1 adj. EPS 1.13 (exp. 0.80), Q1 revenue USD 1.10bln (exp. 1.03bln). Q1 operating income USD 153mln (+96% Y/Y), adj. operating income USD 182mln (+67% Y/Y). Cash flow from operations USD 176mln (-27% Y/Y). Exec said it started the new fiscal year strong, with high-quality, broad-based growth across all regions and key categories. Increased its FY25 outlook for both net sales and non-GAAP operating income; sees FY sales between USD 4.34-4.43bln (prev. saw 4.3-4.4bln), and sees FY adj. operating income between USD 700-730mln (prev. saw 685-715mln). Its ADRs rose 0.5% in extended trading. (Newswires)

OTHER SWISS COMPANIES

Lindt & Spruengli (LISP SW) – H1 (CHF): Sales 2.16bln, +7% Y/Y, EBIT Margin 13.5% (prev. 12.2%). Achieved robust growth in sales and growth; confirms FY24 guidance. To initiate buyback programme in amount of up to CHF 500mln. Will start on Aug 2 and last until July 31, 2026. (Newswires)

Galencia (GALE SW) – Notified Dutch authority for financial markets of its 10% stake in Redcare Pharmacy (RDC GY). No plans to further increase investment. (Newswires)

Julius Baer (BAER SW) – Appointed Stefan Bollinger as CEO. (Newswires)

BROKER MOVES

SCANDINAVIA

Norsk Hydro (NHY NO) – Q2 (NOK): Adj. EBITDA 5.8bln (exp. 6.15bln), Revenue 50.9bln (exp. 49.6bln). Adj. EBITDA negatively impacted by lower extrusions volumes, recycling margins and energy spot sales. Mitigates challenges of a weak downstream market by extrusions cost-sabing measuring and maintaining extrusions margins. (Newswires)

Vestas Wind Systems (VWS DC) – Secured 136 MW repowering order in the USA. (Newswires)

BROKER MOVES

US

CLOSES: SPX +1.08% at 5,664, NDX +1.54% at 19,822, DJI +0.32% at 40,415, RUT +1.69% at 2,221.

SECTORS: Technology +1.96%, Communication Services +1.2%, Industrials +1.07%, Real Estate +0.98%, Utilities +0.87%, Consumer Discretionary +0.87%, Financials +0.64%, Health +0.57%, Materials +0.34%, Consumer Staples -0.04%, Energy -0.72%.

Cleveland-Cliffs (CLF) - Shares rose in afterhours trade followings it Q2 earnings report, where its beat on profits was underpinned by cost controls. Q2 adj. EPS 0.11 (exp. -0.02), Q2 adj. EBITDA USD 323mln (exp. 284mln), Q2 revenue USD 5.09bln (exp. 5.2bln). It said that despite less than ideal steel demand and weak pricing throughout the quarter, it operated well, and expects to benefit from another major step down in costs in Q3. Its largest end market - the automotive sector - remains in good shape, it said, and orders from service centre customers are expected to increase as seaborne steel imports dry up. It is lowering its FY24 CapEx forecast range to USD 650-700mln (prev. saw 675-725mln). Said its objective of Y/Y steel unit cost reductions of roughly USD 30 per net tonne remains on track. (Newswires)

CrowdStrike (CRWD) - Co. said it released a sensor configuration update on Friday for its Falcon sensor software which resulted in outages for customers utilising certain window systems, while it noted the outage was not caused by a cyberattack. (Newswires)

Crypto Stocks - US SEC told issuers US spot ETF products can start trading on Tuesday, according to two firms cited by Reuters. (Newswires)

Google (GOOG) - Wiz walks away from a USD 23bln deal with Google (GOOG) and will pursue an IPO, according to CNBC. (CNBC) Separately, Google drops plan to remove cookies from Chrome browser, according to FT. (FT)

New York Community Bancorp (NYCB) - Closes sale of about USD 5.9bln mortgage warehouse loans to JPMorgan Chase Bank (JPM) and expects to close on an additional USD 200mln of warehouse loans in the near future once necessary customer approvals are received. (Newswires)

Nucor Corp (NUE) - Q2 2024 (USD): EPS 2.68 (exp. 2.35), Revenue 8.08bln (exp. 7.69bln). Expect earnings in Q3 2024 to decrease vs. Q2 2024. Sees decrease in earnings of steel mills segment, primarily due to lower average selling prices. (Nucor IR)

NXP Semiconductors NV (NXPI) - Q2 2024 (USD): Adj. EPS 3.20 (exp. 3.21), Revenue 3.13bln (exp. 3.12bln). KEY METRICS: Adj. gross margin 58.6% (exp. 58.5%). Adj. operating income 1.07bln (exp. 1.07bln). Adj. operating margin 34.3% (exp. 34%). Inventory 2.15bln (exp. 1.97bln). Adj. free cash flow 577mln (exp. 854.3mln). Q3 GUIDANCE: Adj. EPS 3.21-3.63 (exp. 3.56). Revenue 3.15-3.35bln (exp. 3.35bln). (NXP IR)

US Earnings - Alphabet (GOOG) and Tesla (TSLA) are amongst those reporting today - full details can be found in our US Earnings Estimates release in the Research Suite.

23 Jul 2024 - 06:49- Exclusive- Source: Newsquawk