Newsquawk Daily European Equity Opening News - 28th 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 lower following on from the subdued mood in global counterparts with risk appetite sapped by the recent China sell-off, pre-FOMC cautiousness and mixed US data. Focus was also on the mega-cap tech earnings which failed to inspire index futures despite Alphabet, Apple and Microsoft all beating on top and bottom lines with shares in the iPhone maker pressured after-hours as it also warned that chip shortages could impact iPhones and iPads during the current quarter. ASX 200 (-0.8%) was dragged lower by underperformance in tech and commodity-related sectors, while growth concerns were also stoked after the New South Wales Premier announced a four-week extension to the lockdown in Sydney with CBA and ANZ Bank now forecasting a quarterly contraction for Q3 of 2.7% and 1.3%, respectively. Nikkei 225 (-1.6%) was pressured by the recent haven flows into the JPY and amid reports that several prefectures were seeking state of emergency declarations due to the ongoing COVID-19 outbreak. Hang Seng (-0.1%) and Shanghai Comp. (-0.6%) were choppy whereby the former attempted a rebound from this week’s bloodbath with early reprieve for the tech sector and education stocks. However, the recovery for tech and the Hong Kong benchmark was then briefly wiped out alongside the continued rout in the mainland where reports that China may raise fiscal spending and instigate new supportive policies in H2, as well as several attempts by Chinese press to soothe investor concerns regarding the stock rout, ultimately fell on deaf ears.

EUROPEAN CLOSES

CLOSES: Euro Stoxx 50 -0.83% at 4,069; FTSE 100 -0.52% at 6,989; DAX -0.67% at 15,514; CAC 40 -0.66% at 6,535; IBEX 35 -0.94% at 8,693; FTSE MIB -0.70% at 25,120; SMI -0.19% at 12,027.

SECTORS: Materials -0.05%, Healthcare -0.25%, Utilities -0.34%, Telecoms -0.35%, Industrials -0.48%, Financials -0.53%, Energy -0.60%, Consumer Disc -1.25%, Consumer Stpl -1.60%, IT -1.64%

FTSE 100

HSBC (HSBA LN) – ECU Groups’ lawyers have accused the Co. of ‘blatant and indefensible’ forex fraud as part of their closing submission to the London High Court regarding trades made between 2004-2006. (FT)

Rio Tinto (RIO LN) - Co. faces an FCA probe into the USD 6.75bln Mongolian Oyu Tolgoi copper mine. (FT) Separately, Co. has committed USD 2.4bln to the Jadar lithium project in Serbia. (Newswires)

UK Travel & Leisure - UK PM Johnson is expected to approve the reopening of England's borders to double-vaccinated tourists from the EU and the US. (FT)

OTHER UK COMPANIES

Cobham (COB LN)/Ultra Electronics (ULE LN) – As part of Cobham’s proposed takeover of Ultra Electronics, separate UK and US boards could be created to appease UK national security concerns on the deal, according to sources. (Telegraph)

Meggitt (MGGT LN) - The Times notes of rumours circulating that a potential anonymous PE firm had made an approach for the Co. This follows speculation earlier this year that Woodward (WWD) was also mulling a bid for the Co. (Times)

Morrison's (MRW LN) - Co's largest shareholder Silchester International (15.4% stake) said it is not inclined to support Fortress' offer at the upcoming shareholder meeting. Shareholders are due to vote on the offer on 16 August. (BBC)

BROKER MOVES

INTERTEK GROUP (ITRK LN) UPGRADED TO BUY FROM HOLD AT HSBC

DAX

BASF (BAS GY) - Q2 revenue 19.8bln vs prelim. EUR 19.8bln. Adj. EBITDA EUR 3.2bln vs prev. EUR 1.1bln. net profit EUR 1.7bln vs prev. loss EUR 0.9bln. Sales +56% YY. FCF EUR 1.77bln vs prev. EUR 1.52bln. Co. reaffirms its adj. EBIT, revenue and organic CAPEX targets. (Newswires)

Deutsche Bank (DBK GY) - Q2 pretax. profit EUR 1.17bln vs exp. EUR 0.70bln. Net revenue EUR 6.24bln vs exp. EUR 5.93bln. FICC revenue EUR 1.81bln vs exp. EUR 1.67bln. CET1 ratio 13.2% vs exp. 13.1%. Q2 credit provisions EUR 75mln vs prev. EUR 761mln YY. Adj. costs EUR 4.6bln vs exp. EUR 4.7bln. Corporate Bank net revenues -8% YY, Investment Bank -11%, Private Bank +3%, Asset Management +14%. Co. expects net revenues ahead of the guidance provided in December 2020. "The bank sees a substantial portion of its revenue growth in recent quarters as sustainable, as underpinned by strong business growth in 2021 to date and the expected gradual easing of interest rate headwinds in future quarters. Additionally, provision for credit losses is expected to be lower than previous guidance, in a range of around 20 basis points of average loans. DWS (DWS GY) Q2 revenue EUR 625mln vs exp. EUR 614mln. Net inflows EUR 19.7bln vs exp. EUR 6.41bln. DWS expects FY21 revenue to be higher than in 2020, driven by high net inflows and current market environment. (Newswires/Deutsche Bank)

OTHER GERMAN COMPANIES

Hella (HLE GY) - Prelim. FY20/21 adj. EBIT EUR 510mln vs prev. EUR 233mln. Revenue EUR 6.5bln vs prev. EUR 5.8bln. Co. said it continued to grow faster than the global auto market. (Newswires)

Porsche (PAH3 GY) – Co. is investing in Isar Aerospace as part of measures to ensure access to space-based tech. (FT)

BROKER MOVES

CAC

Atos (ATO FP) – H1 revenue EUR 5.42bln vs prev. EUR 5.48bln, net EUR 1.48bln vs prev. EUR 2.93bln, adj. operating EUR 302mln vs prev. EUR 433mln. Affirms FY21 guidance. Full North American accounting review has been satisfactorily completed, did not reveal any material misstatements. (Newswires)

Kering (KER FP) - H121 net EUR 1.48bln vs exp. EUR 1.40bln. Revenue EUR 8.05bln vs exp. EUR 7.7bln. Co. is to consider options for its watch unit but it is not currently in a sales process. Revenue breakdown - Gucci Group: EUR 4.48bln vs exp. EUR 4.35bln; Q2 SSS +86.1 vs exp. +77.1%, Other Luxury: EUR 1.48bln vs exp. EUR 1.43bln, Yves Saint Laurent: EUR 1.05bln vs exp. EUR 1.01bln. (Globe Newswire) [3.4% CAC 40 weight, 1.6% Euro Stoxx 50 weight]

OTHER FRENCH COMPANIES

CapGemini (CAP FP) – H1 revenue EUR 8.71bln vs exp. EUR 8.55bln, net EUR 443mln vs exp. EUR 644mln. Upgrades FY21 guidance to revenue 12-13% vs prev. guided 7-9%. (Newswires)

Eurazeo (RF FP) – H1 net income EUR 476mln, net asset value EUR 99.10/shr. Ahead of schedule with the trajectory of doubling assets. Intends to continue programme of asset disposals in H2-2021 and 2022. (Newswires)

Ipsen (IPN FP) – Co. has entered an exclusive worldwide collaboration with BAKX Therapeutics to research, develop and commercialise BKX-001 as a possible leukaemia/lymphoma treatment. (Newswires)

Rexel (RXL FP) - H1 net EUR 270.6mln vs prev. EUR -439.8mln. Revenue EUR 7.06bln vs prev. EUR 6.05bln. Co. affirms its FY21 revenue guidance. (Newswires)

BROKER MOVES

PAN EUROPE

Aena (AENA SM) - H1 net EUR -346.4mln vs exp. EUR -300mln. Revenue EUR 829.8mln vs prev. EUR 1.09bln. (Newswires)

Euskaltel (EKT SM) – H1 revenue EUR 338mln vs prev. EUR 334mln, net EUR -5.5mln vs prev. EUR 35.6mln, EBITDA EUR 147mln vs prev. EUR 175mln. (Newswires)

Ferrovial (FER SM) - H1 revenue EUR 2.97bln vs prev. 2.94bln YY. EBITDA 251mln vs prev. 136mln YY. Net loss 177mln vs prev. 384mln YY. (Newswires)

Italian Banks - Bank of Italy called on 'less significant banks' to keep a careful approach in deciding payout policies and share buybacks. (Newswires)

Moncler (MONC IM) - H1 net EUR 58.7mln vs exp. 47mln. Revenue EUR 622mln vs exp. 613mln. Co. is confident about Q3 sales with e-commerce and the launch of fragrances among key drivers. (Newswires)

Santander (SAN SM) - Q2 net EUR 2.07bln vs exp. EUR 1.7bln. Revenue EUR 11.3bln vs prev. EUR 10.7bln YY. Underlying profits +40% YY. Profit before tax +114% YY. Net fee income reached pre-pandemic levels (+8%). Co. is set to outperform its FY21 profitability target. (Newswires/Santander)

Vopak (VPK NA) - H1 Adj. EBIT 124.6mln vs prev. EUR 129.8mln YY. Revenue EUR 303.1mln vs prev. EUR 292.4mln. ROCE 10.6% vs prev. 12.1%. Co. notes of an impairment of EUR 69.7mln. (Newswires)

BROKER MOVES

SMI

Credit Suisse (CSGN SW) - Co. is expected to publish details of its failures related to Archegos, according to WSJ. (WSJ)

OTHER SWISS COMPANIES

Adecco (ADEN SW) – To acquire Akka Technologies (AKKA FP) for EUR 2.0bln. (Newswires)

Cellnex Telecom (CLNX SM) – UK CMA has referred the anticipated acquisition of CK Hutchinson’s UK Towers by the Co. to a Phase Two investigation. (Newswires)

BROKER MOVES

SCANDINAVIA

BROKER MOVES

SVENSKA HANDELSBANKEN (SHBA SS) DOWNGRADED TO HOLD FROM BUY AT SOCIETE GENERALE

US

Apple Inc (AAPL) - Q3 2021 (USD): EPS 1.30 (exp. 1.01/1.00 GAAP), Revenue 81.4bln (exp. 73.3bln). Revenue breakdown: iPad 7.37bln (exp. 7.15bln), iPhone 39.57bln (exp. 34.00bln), Mac 8.24bln (exp. 8.07bln), Other Products 8.78bln (exp. 7.80bln), Services: 17.49bln (exp. 16.33bln). Qtrly Dividend: 0.22 (exp. 0.22). CEO Cook said Co. has 700mln subscribers on its platforms vs prev. 660mln Q/Q. Sales impact from global chip shortage was below the low end of its previous estimates of USD 3bln-4bln. AppleCare subscription revenue rebounded in Q3 as may retail stores were open. iPhone 12 Pro and Pro Max were strong sellers, while supply constraints tempered growth in iPad and Mac sales. Co. guides Q4 revenue growth of double-digits but below the Q3 growth of 36%, expects supply constraint in Q4 to be greater than Q3 and which will primarily impact iPhones and iPads. (Business Wire) Shares fell 2% after market. [6.6% SPX weight, 13.5% NDX weight, 2.8% Dow weight]

Alphabet Inc (GOOGL) Q2 2021 (USD): Adj. EPS 27.26 (exp. 19.34/19.33 GAAP), Revenue 61.88bln (exp. 56.16bln). Google Services revenue USD 57.07bln (exp. 51.95bln). Google Cloud revenue USD 4.63bln (exp. USD 4.34bln). Other bets revenue USD 192mln (exp. 185.4mln). Operating income USD 19.36bln (exp. 15.04bln). Operating margin 31% (exp. 26%). Google Services operating income USD 22.34bln (exp. 18.08bln). Google Cloud operating loss USD 591mln (exp. loss 1.29bln). Other Bets operating loss USD 1.40bln (exp. loss 1.07bln). (Newswires) Shares rose 3% after market. [5.8% SPX weight, 11.9% NDX weight, 5.4% Dow weight

Advanced Micro Devices Inc (AMD) - Q2 2021 (USD): Adj. EPS 0.63 (exp. 0.54/0.47 GAAP), Revenue 3.85bln (exp. 3.62bln); Raises FY21 revenue growth view to +60% Y/Y (Prev. +50% Y/Y) driven by all businesses. Q3 2021 Revenue View: 4.1bln (exp. 3.82bln) primarily driven by data centre and gaming. Computating And Graphics: 2.25bln (exp. 2.19bln). Enterprise, Embedded And Semi - Custom: 1.60bln (exp. 1.40bln). Adjusted gross margin 48% (exp. 47%, prev. 44% y/y). Capital Expenditure USD 64mln. (Globe Newswires) Shares rose 1% after market. [0.3% SPX weight, 0.6% NDX weight]

Microsoft Corp (MSFT) - Q4 2021 (USD): EPS 2.17 (exp. 1.92/1.92 GAAP), Revenue 46.2bln (exp. 44.24bln). Intelligent Cloud: 17.4bln (exp. 16.34bln). More Personal Computing: 14.1bln (exp. 13.86bln). Productivity And Business Processes: 14.7bln (exp. 13.91bln). Operating income was USD 19.1 billion and increased 42%. Net income was USD 16.5 billion and increased 47%. Co. guides Q1 rev. USD 43.3bln-44.3bln (exp. 42.2bln), sees Q1 productivity and business process rev. USD 14.5bln-14.75bln, sees Q1 Intelligent Cloud rev. USD 16.4bln-16.65bln. (Newswires) Shares rose 0.2% after market. [5.8% SPX weight, 11.9% NDX weight, 5.4% Dow weight]

CLOSES: SPX -0.57% at 4,397, NDX -1.29% at 14,930, DJIA -0.28% at 35,046, RUT -1.23% at 2,190

SECTORS: Consumer Discretionary -1.25%, Communication Svs. -1.22%, Technology -1.17%, Energy -1.15%, Industrials -0.6%, Financials unch., Materials +0.04%, Consumer Staples +0.19%, Health Care +0.39%, Real Estate +0.74%, Utilities +1.58%

28 Jul 2021 - 06:54- Research Sheet- Source: Newsquawk