Newsquawk Daily European Equity Opening News - 24th October 2024

ASIA

APAC stocks traded somewhat cautiously following the losses stateside where the major indices declined as participants digested earnings releases and negative stock-specific updates, while yields also continued to edge higher. ASX 200 initially retreated following a further deterioration in manufacturing PMI data but then gradually clawed back opening losses with the recovery spearheaded by resilience in defensives and tech. Nikkei 225 traded indecisively as participants reflected on recent currency moves and Japanese PMI data contracted. Hang Seng and Shanghai Comp were pressured amid weakness in the tech and property sectors with the latter industry not helped after Moody’s noted that several developers are to feel earnings pain, while macro newsflow remained quiet and a continuation of the firm liquidity efforts by the PBoC also failed to inspire a turnaround.

SK Hynix (000660 KS) - Q3 (KRW) net 5.8tln (exp. 4.9tln), oper. 7.0tln (exp. 6.8tln), rev. 17.6tln (exp. 18.1tln). (Newswires)

EUROPEAN CLOSES

CLOSES: DAX: -0.20% at 19,383, FTSE 100: -0.58% at 8,259, CAC 40: -0.50% at 7,497, Euro Stoxx 50: -0.36% at 4,921, AEX: -0.82% at 890, IBEX 35: +0.27% at 11,865, FTSE MIB: -0.10% at 34,697, SMI: -0.05% at 12,157, PSI: -0.52% at 6,521.

SECTORS: Utilities 0.44%, Telecoms 0.10%, Healthcare 0.07%, IT 0.02%, Consumer Disc -0.02%, Financials -0.49%, Consumer Stpl -0.53%, Industrials -0.57%, Energy -0.78%, Materials -0.87%

FTSE 100

Tobacco/Vaping Names - The UK government has confirmed that selling disposable vapes will be banned from June 2025. (BBC)

OTHER UK COMPANIES

BROKER MOVES

DAX

Deutsche Telekom (DTE GY) - T-Mobile (TMUS) topped Q3 expectations, and lifted its outlook; DTE holds 51% of T-Mobile. Elsewhere, Moody's changes Co's outlook to positive; affirms BAA1 rating. (Newswires)

Siemens (SIE GY) - Is said to be in talks to acquire Altair Engineering (ALTR). (Newswires)

OTHER GERMAN COMPANIES

Siltronic (WAF GY) - Q3 (EUR): EBITDA 89.4mln (exp. 77.1mln), Revenue 357.3mln (exp. 342mln). Remains uncertain when chip manufacturers' inventories will return to normal levels. Raises mid-point EBITDA margin 24-26% (prev. guided 23-25%). (Newswires)

BROKER MOVES

CAC

Carrefour (CARR FP) - Q3 24 (EUR): Revenue +8.8% at EUR 24.05bln (exp. +8.6%); France revenue -3% (exp. -2.4%). (Newswires)

Dassault Systemes (DSY FP) - Q3 (EUR): EPS 0.29 (exp. 0.29), Revenue 1.46bln (exp. 1.51bln). FY outlook: Cuts Revenue +5-7% Y/Y (prev. guided +6-8% Y/Y). (Newswires)

Danone (BN FP) - Q3 (EUR): Revenue 6.83bln (prev. 6.91bln Y/Y). Notes of a challenging environment. Affirms guidance. (Newswires)

Kering (KER FP) Q3 2024 (EUR): Revenue 3.79bln (exp. 3.95bln), Gucci revenue 1.64bln (exp. 1.75bln). Key Metrics: Comparable revenue -16% (exp. -10.9%). Gucci revenue on a comp. basis -25% (exp. -20.7%). Yves Saint Laurent revenue on a comp. basis -12% (exp. -9.94%). Bottega Veneta revenue on a comp. basis +5% (exp. +4.1%). Other Houses revenue on a comp. basis -14% (exp. -3.74%). Eyewear & corporate revenue on a comp. basis +7% (exp. +6.13%). CFO says summer season in Europe was lacklustre, Olympic Games weighed; Consumer demand is fragile around the world. Happy with level of inventory at Gucci. Will close Gucci outlets if it is not sufficiently exclusive. Not expanding Gucci store network, but not decreasing it either. No change in trends in Asia since end of Q3. No improvement for Gucci in US, Balenciaga is coming back to growth in US. Gucci and Saint Lauren are suffering in APAC. New Gucci offer needs to be balance and relevant in all different price segments. No big impact on the French corporate tax plan. Results are largely taxable in Italy. Revenue Breakdown: Yves Saint Laurent 670mln (exp. 688.1mln). Bottega Veneta 397mln (exp. 391.1mln). Other Houses 686mln (exp. 774.5mln). Eyewear & corporate 440mln (exp. 395.4mln). Guidance: Considering the major uncertainties likely to weigh on demand among luxury consumers in the coming months and following the larger-than-expected slowdown in Q3, sees FY recurring operating income at 2.5bln (exp. 2.82bln). Commentary: Introduced 4 new handbag lines in China and showing initial positive reception. Gucci challenge is to recruit new customers. Sales from the directly operated retail network were down 17% on a comparable basis, once again adversely affected by lower store traffic. Trends in the various regions weakened by comparison with Q2 and particularly in Asia-Pacific and in Japan, the latter of which suffered a significant slowdown. (Newswires)

Renault (RNO FP) - Q3 (EUR): Revenue 10.7bln (exp. 10.9bln), Automotive Revenue 9.34bln (prev. 9.39bln), Sales Financing 1.34bln (prev. 1.1bln); maintains FY guidance. "Solid order book in Europe at around 2 months of forward sales, reflecting the sound order intake and ahead a strong Q4". (Newswires)

Michelin (ML FP) - 9mth group total sales 20.171bln, -4.6% Y/Y. Expects segment operating income around EUR 3.4bln (prev. more than EUR 3.5bln). Adjusts FY guidance, sales volume expected within the range of -6 and 4%. Says based on the French government project on a new tax on companies, co. has estimated an impact of "a few dozen millions euros". (Newswires)

Orange (ORA FP) - Q3 (EUR): EBITDAaL 3.35bln (exp. 3.3bln), Revenue 10bln (exp. 10bln). Affirms guidance. (Newswires)

Technip Energies (TE FP) - Co. and Enerkem formalise collaboration to advance waste to sustainable fuels and circular chemicals tech. (Newswires)

OTHER FRENCH COMPANIES

Atos (ATO FP) - Q3 (EUR): Revenue 2.31bln, -10% Y/Y. Financial restructuring plan exp. to close in Dec 2024 or early 2025. (Newswires)

Edenred (EDEN FP) - Q3 (EUR): Revenue 619mln (prev. 634mln Y/Y). (Newswires)

Sodexo (SW FP) - FY (EUR): Net 738mln (prev. 560mln Y/Y), Revenue 23.8bln (prev. 23.7bln Y/Y). (Newswires)

BROKER MOVES

Michelin (ML FP) downgraded to Hold from Buy at HSBC

PAN EUROPE

BE Semiconductor (BESI NA) - Q3 (EUR): Net 46.8mln (prev. 35mln Y/Y), Revenue 157mln (prev. 123mln Y/Y), Orders 151.8mln, +19.2% Y/Y. Q4 guidance: Revenue -10 to +10% Y/Y, Gross margin 63-65%, Opex 0-5% Q/Q. (Newswires)

Intesa Sanpaolo (ISP IM) - Has signed an accord with unions for 4,000 voluntary layoffs and the accord with unions includes 2k new hires. (Newswires)

Saipem (SPM IM) - 9-month 2024 (EUR): Net profit 206mln; revenue for 2024 is expected to exceed EUR 14bln and EBITDA exceed EUR 1.3bln. (Newswires)

BROKER MOVES

SMI

Lonza (LONN SW) - Q3 performance in line. Affirmed FY24 CER Revenue growth "flat". (Newswires)

Temenos (TEMN SW) - Q3 24 ARR +9% Y/Y to USD 761mln; Non-IFRS EBIT +19% Y/Y with 4% points margin expansion; slightly revised FY24 guidance; ARR growth of 11-12% (prev. c. 13%). (Newswires)

Novartis (NOVN SW) - Novartis Ribociclib recognized as Category 1 preferred breast cancer adjuvant treatment by NCCN Clinical Practice Guidelines in Oncology (NCCN Guidelines). (Newswires)

OTHER SWISS COMPANIES

Avolta (AVOL SW) - Refinances main banking facility; current available liquidity position of CHF 2.1bln. (Newswires)

Galencia (GALE SW) - Q3 (CHF): Revenue 2.85bln (prev. 2.75bln Y/Y). Affirms guidance. (Newswires)

Galderma (GALD SW) - 9m (CHF): Revenue 3.26bln, +9.2% Y/Y. Narrows FY24 Revenue +8.8-9.5% Y/Y (prev. guided +7-10% Y/Y). (Newswires)

BROKER MOVES

SCANDINAVIA

Equinor (EQNR NO) - Q3 (USD): Adj. EPS 0.79 (exp. 0.74), Revenue 25.5bln (exp. 24.8bln); extraordinary dividend 0.35/shr. To commence fourth tranche of share buyback for up to USD 1.6bln. (Newswires) Cuts FY24 organic capex 12-13bln (prev. guided 13bln). (Newswires)

Essity (ESSITYB SS) - Q3 (SEK): Net sales 36.27bln (exp. 36.6bln), Adj. EBITDA 5.0bln (exp. 5.0bln). (Newswires)

Kone (KNEBV FH) - Q3 (EUR): Adj. EBIT 319.4mln (prev. 316.5mln Y/Y), Revenue 2.75bln (prev. 2.75bln Y/Y). Narrows FY Revenue 0-3% (prev. guided "flat to +4%"). (Newswires)

Huthmaki (HUH1V FH) - Q3 (EUR): Adj. EBIT 102.4mln (prev. 100.3mln Y/Y). Affirms guidance. (Newswires)

Nordic Semiconductor (NOD NO) - Q3 (USD): Revenue 159mln (exp. 159.3mln). Guides Q4 revenue 130-150mln. (Newswires)

Norsk Hydro (NHY NO) - Q3 (NOK): Adj. Net 3.51bln (exp. 3.05bln), Adj. EBIT 4.94bln (exp. 4.84bln), Revenue 50.1bln (exp. 50.3bln). (Newswires)

Novo Nordisk (NOVOB DC) - Co. asks the US to stop compounding pharmacies from making weight loss drug copies, according to Reuters. (Reuters)

Stora Enso (STERV FH) - Q2 (EUR): Adj. EPS 0.1 (exp. 0.15), Adj. EBIT 175mln (exp. 183mln). Raises FY24 Adj. EBIT "significantly higher Y/Y" (prev. guided "higher"). (Newswires)

SEB (SEB SS) - Q3 (SEK): Net Income 9.4bln (exp 8.61bln), EPS 4.63 (exp. 3.93), NII 11.05bln (exp. 11.38bln). Reiterated underlying FY24 cost target. (Newswires)

Telia (TELIA SS)- Q3 (SEK): Net 2.51bln (prev. 1.96bln Y/Y), Revenue 21.8bln (prev. 22.08bln Y/Y). (Newswires)

BROKER MOVES

US

CLOSES: SPX -0.92% at 5,797, NDX -1.55% at 20,067, DJIA -0.96% at 42,515, RUT -0.79% at 2,214

SECTORS: Consumer Discretionary -1.82%, Technology -1.68%, Communication Services -1.37%, Energy -0.48%, Health -0.46%, Materials -0.35%, Industrials -0.30%, Consumer Staples -0.12%, Financials -0.12%, Utilities +1.01%, Real Estate +1.02%.

Apple (AAPL) - Delays planned debut of Mac Studio until later in 2025, according to Bloomberg; preparing to launch new low-end iPad around spring 2025 and readies MacBook air models with M4 chip for early 2025. Elsewhere, iPhone 16 orders reportedly cut by around 10mln units for Q4 24-Q2 25; no evidence yet that Apple Intelligence could boost iPhone shipments in the near term, via TF Intl. Securities analyst Ming Chi Kuo. (Bloomberg / TD Intl.)

International Business Machines (IBM) - Despite a Q3 profit beat, shares slipped 2.5% afterhours following disappointing consulting and infrastructure revenue. Q3 adj. EPS 2.30 (exp. 2.23), Q3 revenue USD 14.97bln (exp. 15.07bln). Q3 FCF USD 2.06bln (exp. 2.08bln). Exec said Q3 performance was driven by double-digit software growth, including Red Hat, and significant momentum in AI. Its generative AI business now exceeds USD 3bln. The pause in discretionary spending was impacting its consulting business. IBM expects Q4 revenue growth to match Q3 and anticipates over USD 12bln in 2024 free cash flow. Exec added that it is transitioning to higher-growth, higher-margin businesses and remains well-positioned for AI-driven growth. Sees Q4 constant currency revenue growth consistent with Q3, and affirmed its FY FCF guidance at USD 12.0bln (exp. 12.25bln).

McDonald's (MCD) - Says it has not yet ruled out beef in the e.coli outbreak; noting its sells 1mln quarter pounders every two weeks

Tesla (TSLA) - Shares rose over 12% in extended trading following a profit beat in the quarter. Q3 adj. EPS 0.72 (exp. 0.58), Q3 revenue USD 25.18bln (exp. 25.37bln). Q3 gross margin 19.8% (exp. 16.8%). Q3 FCF USD 2.74bln (exp. 1.61bln), Q3 CapEx USD 3.51bln (exp. 2.56bln). Expects slight growth in vehicle deliveries in 2024. Cybertruck production increased, achieving a positive gross margin for the first time; Cybertruck became the third best-selling EV in Q3, behind the Model Y and Model 3. It said it saw its second-highest quarter for regulatory credit revenues. Vehicle deliveries are expected to grow slightly in 2024, while energy storage deployments should more than double. Tesla anticipates profit growth from its vehicle and energy businesses. Additionally, it reported the cost of goods sold per vehicle at a record low of USD 35,100. Supercharger stations increased by 20% to 6,700, while Supercharger connectors grew +22% to 62,400. Ahead, it reiterated that preparations for its offering of new vehicles, including more affordable models, which it will begin launching in H1 2025.

T-Mobile US (TMUS) - T-Mobile topped Q3 expectations, and lifted its outlook. Q3 EPS 2.61 (exp. 2.42), Q3 revenue USD 20.16bln (exp. 20.01bln). Q3 total net customers +1.60mln (exp. +1.46mln), prev. +23% y/y); Q3 total customers at end of period +8.1% Y/Y to 127.49mln (exp. 126.84mln). Sees FY postpaid net customers between 5.6-5.8mln (exp. 5.56mln); sees FY CapEx of between USD 8.8-9.0bln (exp. 8.92bln, prev. 8.70-9.10bln), sees FY adj. EBITDA between USD 31.6-31.8bln (prev. saw 31.5-31.8bln, exp. 31.61bln), sees FY adj. FCF between USD 16.7-17.0bln (exp. 16.78bln, prev. saw between 16.6-17.0bln).

Transocean (RIG), Seadrill (SDRL) - Transocean is in merger talks with rival Seadrill as offshore drilling activity rebounds amid steady oil prices, Bloomberg reports. The discussions reflect a positive outlook for offshore exploration following slower production growth from US shale fields, the report added. Seadrill's shares rose by 8.5% in afterhours trade, while Transocean's increased by 4.6%.

24 Oct 2024 - 06:59- Research Sheet- Source: Newsquawk