Newsquawk Daily European Equity Opening News - 27th July 2021

The Daily European Equity Opening News is uploaded at 0700BST/0200EDT recapping all of the overnight equity news.

From 0700BST/0200EDT all equity news will be covered in real-time over the audio and headline feed and the full audio rundown will be at 0715BST/0215EDT.

There will be an additional audio rundown at 0750BST/0250EDT recapping any company news which has hit the wires since 0715BST/0215EDT ahead of the European equity open

European equity coverage will only cover companies in the STOXX 600 or companies of systemic importance to particular sectors.

ASIA

Asian equity markets traded mostly positive as the region found inspiration from Wall St. where all major indices extended on record highs, led by outperformance in cyclicals and with earnings in focus including the looming results from the mega cap tech giants Apple, Alphabet and Microsoft that are due to report after-market on Tuesday. ASX 200 (+0.7%) was underpinned by strength in the commodity-related sectors following further production updates and with BHP lifted after it reached a deal related to port infrastructure for handling of potash which spurred hopes the Co. may proceed with the multi-billion-dollar Jansen mining project. There was also some encouragement from reports that South Australia and Victoria states will exit their lockdowns, although the most-populous state of New South Wales continued to suffer from increasing infections. Nikkei 225 (+0.6%) remained positive and re-tested the 28k level to the upside as earnings results began to trickle in but with gains limited amid concerns of PM Suga’s approval rating which slipped to a nine-year low beneath the 35% level that is seen as a “point of no return” and which has historically resulted in most LDP PMs stepping down within a year. KOSPI (+0.7%) was buoyed by the latest GDP data which despite missing expectations at 5.9% vs Exp. 6.0%, it was still the fastest pace of growth in a decade and above the 4.2% government projection for this year, while it was also reported that South Korea and North Korea reopened their hotline and that their leaders exchanged several letters since April. Hang Seng (-2.1%) and Shanghai Comp. (-0.2%) were varied with the mainland temperamental following the prior day’s regulatory-triggered sell-off and with the continued downturn in Hong Kong led by underperformance in healthcare and heavy losses in tech, while Evergrande shares saw double-digit declines after it scrapped its special dividend proposal.

SK Hynix (000660 KS) - Q2 net KRW 2.0tln vs exp. KRW 2.0tln, oper. profit KRW 2.7tln vs exp. KRW 2.7tln, rev. KRW 10.3tln vs exp. KRW 10.0tln, says Q2 DRAM shipments rose mid-single digit % vs Q1 and average selling price rose by high-teen percentages. (Newswires)

EUROPEAN CLOSES

CLOSES: Euro Stoxx 50 -0.25% at 4,099; FTSE 100 -0.08% at 7,022; DAX -0.36% at 15,613; CAC 40 +0.03% at 6,571; IBEX 35 +0.63% at 8,772; FTSE MIB +0.48% at 25,244; SMI -0.70% at 12,046

SECTORS: Energy 2.63%, Materials 1.02%, Financials 0.98%, IT 0.01%, Utilities -0.12%, Industrials -0.23%, Telecoms -0.27%, Consumer Disc -0.39%, Consumer Stpl -0.79%, Healthcare -1.24%

FTSE 100

BHP (BHP LN) - Co. delivered its final offer to workers at the Escondida copper mine in Chile; offer improves on the current contract and adds new benefits in highly-valued areas for workers. (Newswires) The union has until August 1st to submit this offer to its members for a vote. Shares rose 2.9% in Australian trade

Glencore (GLEN LN) – Co. notes of a plea agreement from the US DoJ by a former employee. Co. said the conduct described in the plea is unacceptable and has no place in the Co. and added that they have cooperated fully with the US authorities. (Newswires)

Just Eat Takeaway..com (JET LN) – Cat Rock Capital (4.2% stake) has called on the Co. to take urgent action to increases its share price in order to avoid a possible hostile takeover. The shareholder said that strategic options including divestments, or a merger should be looked into - with ‘global players' such as DoorDash (DASH), Delivery Hero (DHER GY), Meituan (3690 HK) or Amazon (AMZN). (FT)

Tesco (TSCO LN) – Tesco Bank will be closing all current accounts due to a lack of demand, from 30th November 2021. (BBC)

UK Travel Names - UK is reportedly to consider easing travel restrictions from the EU and the US, according to FT. (FT)

OTHER UK COMPANIES

BROKER MOVES

DAX

OTHER GERMAN COMPANIES

Kion (KGX GY) - Co. raises FY21 revenue guidance to EUR 9.7-10.3bln vs prev. EUR 9.2-9.8bln. Adj. EBIT EUR 810-890mln vs prev. EUR 720-800mln. Co. notes that all key performance indicators have significantly exceeded original forecasts. (Newswires)

BROKER MOVES

COMMERZBANK (CBK GY) INITIATED WITH SELL AT SOCGEN

KRONES (KRN GY) DOWNGRADED TO HOLD FROM BUY AT HSBC

MORPHOSYS (MOR GY) DOWNGRADED TO HOLD FROM BUY AT COMMERZBANK

CAC

EDF (EDF FP) - UK government sources admitted that the GBP 23bln Hinkley Point C project could be at risk by UK plans to block China General Nuclear from future UK projects, as the Chinese company is partially bankrolling the Hinkley reactor. (Telegraph)

LVMH (MC FP) - H1 revenue EUR 28.7bln vs exp. EUR 28.25bln. Profits from recurring operations EUR 7.63bln vs exp. EUR 6.62bln. Q2 selective retail organic revenue +31% vs exp. +26%. Q2 sales EUR 14.7bln (+84% LFL). Sales in fashion and leather goods more than doubled to EUR 7.1bln; wine and spirits +55% LFL. Sales in the retail division +31% LFL, in watches and jewellery +71% LFL; in perfumes +37% LFL. Interim dividend EUR 3.00/shr to be paid on December 2nd, 2021. CFO does not see any particular supply bottlenecks, but may not be able to replicate H1 wine and spirits US growth rates in H2. CFO said the Co. does not see any sign of weakening Chinese demand. (Newswires) Co. holds an 11.4% weighting in the CAC40 and a 5.3% weighting in the Euro Stoxx 50.

Michelin (ML FP) - H1 net EUR 1.03bln vs exp. 0.78bln. Operating profit EUR 7.63bln vs exp. 6.80bln. Revenue EUR 28.7bln vs prev. EUR 18.4bln YY. Co. raises FY21 segment op income view to "greater than" 2.8bln vs prev. "greater than" 2.5bln. Co. raises FY21 FCF view to "greater than" 1bln. Co. said global demand in H2 is likely to experience further global supply chain disruptions. Co. notes that raw material should be less favourable in H2, could be neutral. (Globe Newswires) Co. holds a 1.6% weighting in the CAC40

OTHER FRENCH COMPANIES

Dassault Systems (DSY FP) - Q2 non-IFRS revenue EUR 1.16bln vs prev. EUR 1.07bln. EPS EUR 0.22 vs prev. EUR 0.16. Co. raises FY21 guidance. (Newswires)

Edenred (EDEN FP) - H1 EBITDA EUR 295mln vs exp. EUR 288mln. Revenue EUR 757mln vs exp. EUR 747mln. Co. raises FY21 EBITDA guidance to "at least 9%" vs prev. "at least 6%". (Newswires)

Lagardere (MMB FP) - H1 adj. net EUR -86mln vs prev. EUR -276mln. Recurring EBIT EUR 3mln vs prev. EUR -218mln. Revenue EUR 2.08bln vs prev. EUR 2.09bln YY. LFL sales +5% YY. (Newswires)

Sodexo (SW FP) – Co. has entered into exclusive negotiations to combine its childcare activities with the equivalent from the Grandir Group, as such Sodexo would become a minority shareholder of Grandir. (Newswires)

BROKER MOVES

PAN EUROPE

Auto Names - Tesla (TSLA) CEO Musk said the global ship shortage remains quite serious and cannot say how long it will last but seems like it is improving. (Newswires) See US section below for TSLA earnings

Chip Names - Intel (INTC) announced two breakthrough process technologies to speed up process and packaging innovations. (Newswires)

Randstad (RAND NA) - Q2 revenue EUR 6.08bln vs exp. EUR 5.8bln. Organic revenue +38% YY. (Newswires)

BROKER MOVES

SMI

Credit Suisse (CSGN SW) - Co. appoints David Wildermuth as Chief Risk Officer, effective February 1st 2022. (Newswires)

Nestle (NESN SW) - Starbucks (SBUX) and Nestle are to launch ready-to-drink coffee beverages to Southeast Asia, Oceania, and LatAm as of 2022. (Newswires)

OTHER SWISS COMPANIES

Lindt & Spruengli (LISN SW) - H1 revenue CHF 1.8bln vs prev. CHF 1.53bln. Net profit CHF 101.6mln vs prev. CHF 19.7mln. FCF CHF 227.9mln vs prev. CHF 188.7mln. Co. launched a buyback of up to CHF 750mln. (Newswires)

Logitech (LOGN SW) - Q1 EPS USD 1.22 vs prev. USD 0.64 Y/Y, rev. USD 1.3bln vs prev. USD 791.9mln Y/Y. (Newswires)

BROKER MOVES

SCANDINAVIA

Handelsbanken (SHBA SS) - Co. is to sell its Worldline unit for SEK 2bln. (Newswires)

BROKER MOVES

FLSMIDTH (FLS DC) UPGRADED TO NEUTRAL FROM UNDERPERFORM AT CREDIT SUISSE

STORA ENSO (STERV FH) UPGRADED TO BUY FROM NEUTRAL AT CITIGROUP

US

Amazon (AMZN) denied reports it will accept Bitcoin this year and denies that it is planning launching its own crypto coin next year, but says will continue to explore crypto. (Newswires)

Tesla Inc (TSLA) Q2 2021 (USD): Adj. EPS 1.45 (exp. 0.98/0.58 GAAP), Revenue 11.96bln (exp. 11.30bln). Q2 automotive gross margin 28.4% (exp. 26.1%, prev. 25.4% Y/Y). Q2 cash and cash equivalents USD 16.23bln vs exp. USD 16.55bln. Co. notes of supply challenges and in particular semiconductor shortages, as well as port congestion remained present in Q2. Bitcoin-related impairment of USD 23mln recorded for the quarter. Co. expects car deliveries to increase more than 50% this year. Co. is to delay its Semi electric truck program due to battery cell supply constraints. (Newswires) Shares rose 1% after market

CLOSES: SPX +0.24% AT 4,422, NDX +0.09% AT 15,126, DJIA +0.24% AT 35,145, RUT +0.33% AT 2,217

SECTORS: ENERGY +2.5%, MATERIALS +0.88%, CONSUMER DISCRETIONARY +0.77%, COMMUNICATION SVS. +0.71%, FINANCIALS +0.54%, CONSUMER STAPLES +0.19%, REAL ESTATE UNCH., UTILITIES -0.01%, TECHNOLOGY -0.02%, INDUSTRIALS -0.02%, HEALTH CARE -0.62%

27 Jul 2021 - 06:50- Research Sheet- Source: Newsquawk