Newsquawk Daily European Equity Opening News - 28th October 2024

ASIA

APAC stocks were mostly positive as markets digested key events over the weekend including Israel's strike on Iran which was aimed at military targets and not petroleum or nuclear facilities, while the election in Japan saw the ruling coalition lose its majority. ASX 200 traded indecisively as gains in tech and the mining sectors offset the weakness in real estate, utilities and energy. Nikkei 225 quickly shrugged off the initial post-election jitters and surged on the back of a weaker currency and prospects that the political uncertainty could delay the resumption of the BoJ's rate normalisation. Hang Seng and Shanghai Comp swung between gains and losses but ultimately eked mild gains after the PBoC announced it is to utilise outright reverse repo operations today, which will be conducted on a monthly basis and is a new policy tool aimed at managing liquidity.

LG Energy Solution (373220 KS) - Q3 (KRW) oper. profit 448bln (prelim. 448bln), rev. 6.9tln (prelim. 6.9tln). Expects Q4 revenue to be similar to Q3 revenue, expects it to be challenging to improve profitability in Q4 vs Q3 due to seasonality and inventory adjustments. (Newswires)

EUROPEAN CLOSES

CLOSES: DAX +0.11% at 19,464, FTSE 100 -0.25% at 8,249, CAC 40 -0.08% at 7,498, Euro Stoxx 50 +0.15% at 4,943, AEX +0.33% at 899, IBEX 35 -0.23% at 11,813, FTSE MIB +0.22% at 34,776, SMI +0.04% at 12,178, PSI +0.34% at 6,513.

SECTORS: Materials 0.84%, Energy 0.68%, IT 0.39%, Industrials 0.17%, Healthcare 0.07%, Consumer Disc 0.05%, Telecoms -0.12%, Consumer Stpl -0.32%, Financials -0.39%, Utilities -0.42%

FTSE 100

BT (BT/A LN) - Co. is working with Citi (C) to explore the disposal of Radianz, via FT citing sources; the unit could be valued in the low hundreds of millions of pounds. (FT)

LSE (LSEG LN) - Co. is considering cutting around 200 jobs globally after its execs conducted a review of the business, according to Bloomberg citing sources. (Bloomberg)

Shell (SHEL LN) - Co. has begun restarting the hydrocracker at the Louisiana refinery, according to Reuters citing sources. (Reuters)

UK Banks / Lloyds (LLOY LN) - Following the UK's ruling on auto loans; analysts at Citi note that their previous estimate of a GBP 9bln charge for the sector could double, according to Bloomberg. (Bloomberg)

UK Energy - UK Chancellor Reeves said the UK government is to announce GBP 500mln in aid from energy suppliers, while the announcement could be made in the upcoming budget. (Newswires)

UK Business - UK Lloyds Business Barometer (Oct) 44 (Prev. 47); sinking to a four-month low.

OTHER UK COMPANIES

BROKER MOVES

Glencore (GLEN LN) upgraded to Buy from Hold at HSBC

DAX

Porsche (P911 GY) - 9-month (EUR): Operating profit 4.04bln (prev. 5.5bln Y/Y), Operating return on sales 14.1% (prev. 18.3%), Revenue 28.56bln, -5.2%; confirms 2024 outlook, provided conditions don't worsen significantly. CFO says they are reviewing product line-up, budgets, costs due to slowing EV transition, and China weakness. Q3 has been weakest quarter of 2024. Dealing with structural shift in demand in China. CFO says China is incredible challenge for European carmakers and have to assume that Chinese market will not return to former strength; adjusting global cost structure to reflect annual vehicle sales of 250k (prev. more than 300k). China sales will remain depressed next year. EU must scrap 2035 ban on new combustion sales. (Newswires)

Thyssenkrupp (TKA GY) - Carlyle drops bid for Thyssenkrupp defense unit, according to FT. (FT)

Volkswagen AG (VOW3 GY) - Volkswagen is considering cost-cutting measures, including a 10% wage cut and a two-year wage freeze, aiming to save EUR 4bln, Reuters reports. This comes amid pressure to reduce expenses in a challenging economic climate, with workers demanding clarity on future strategies. Elsewhere, Volkswagen workers in Germany plan rallies and production pauses amid resistance to potential job cuts and plant closures, Bloomberg reports; unions criticised management’s lack of strategy, as Volkswagen faces declining sales and intensified competition.

OTHER GERMAN COMPANIES

Wacker Chemie (WCH GY) - Q3 (EUR): Net Income 33.9mln (exp. 30.5mln), EBITDA 152mln (exp. 162mln), Revenue 1.43bln (exp. 1.45bln, prev. 1.52bln Y/Y). Raises FY EBITDA "upper half" 600-800mln (prev. guided 600-800mln). (Newswires)

BROKER MOVES

CAC

Eurofins Scientific (ERF FP) - Agrees to acquire Synlab's clinical diagnostics operations in Spain; transaction exp. to close in 2025. No terms disclosed. (Newswires)

French stocks - Moody’s affirmed France at Aa2; Outlook revised to negative from stable. (Newswires)

Schneider Electric SE (SU FP) - Positive mention in Barron's; the newspaper says Schneider is poised for growth; 2024 sales are projected to rise +5% driven by rising electricity demand, and Barron's argues that the stock could rise by +25% over the next year. (Newswires)

Thales (HO FP)/Airbus (AIR FP) - A potential alliance between the two firms space units has been described as anti-competitive and could result in a monopoly within Europe, according to OHB’s CEO. (FT) OBH is a rival satellite producer

TotalEnergies (TTE FP) - Co. is involved in a legal battle amid its plans to shut operations in the North Sea, according to The Telegraph. Nobel Upstream, a rival operator, notes that it will damage the UK's oil and gas production. (The Telegraph)

OTHER FRENCH COMPANIES

JC Decaux (DEC FP) - Will not pursue the purchase of Clear Channel's business in Spain. (Newswires)

BROKER MOVES

PAN EUROPE

Bawag (BG AV) - Q3 (EUR): Net Income 178mln (prev. 186mln Y/Y), Core Revenue 387.9mln (prev. 390.3mln Y/Y). Raises FY targets pretax "more than 950mln" (prev. guided "more than 920mln"). (Newswires)

ENI (ENI IM) - Co. expects EUR 2.5bln in net proceeds from additional disposals in the next year. (Newswires)

Energy names - Libya’s NOC said ENI (ENI IM) and BP (BP/ LN) resumed exploration in Libya after onshore drilling was halted in 2014. (Newswires)

Koninklijke Philips (PHIA NA) - Q3 (EUR): Adj. EBIT 516mln (exp. 481mln, prev. 456mln Y/Y), Revenue 4.4bln (exp. 4.5bln). SSE -0.5% (exp. +3%), adj. EBITA margin 11.8% (prev. 10.2% Y/Y). Cuts comp sales outlook noting of significant deterioration in China demand. FY Outlook: Sales growth +0.5-1.5% Y/Y (prev. guided +3-5% Y/Y). Raises lower-end adj. EBITDA margin 11.5% (prev. guided 11-11.5% Y/Y), Trims FCF 0.9bln (prev. guided 0.9-1.1bln). (Newswires)

Koninklijke KPN (KPN NA) - Q3 (EUR): Net Income 231mln (exp. 220mln), Adj. EBITDAaL 643mln (exp. 637mln). Affirms guidance. (Newswires)

Santander (SAN SM) - Co. starts cutting jobs in the UK as part of cost-saving plans, according to Reuters citing sources; job cuts focused on UK HQ. (Reuters)

BROKER MOVES

SMI

Novartis AG (NOVN SW) - Novartis presented 12-month data from its Phase III APPEAR-C3G study at the American Society of Nephrology Kidney Week 2024, showing that oral Fabhalta, combined with supportive care, led to significant and sustained reductions in proteinuria in C3 glomerulopathy patients.

OTHER SWISS COMPANIES

Clariant (CLN SW) - Ben Van Beurden proposed as the new chair and member of BoD. (Newswires)

Gam Holdings (GAM SW) - Files to sell CHF 100mln in shares. (Newswires)

BROKER MOVES

SCANDINAVIA

EQT (EQT SS) - CEO Sinding says they are looking into acquisitions of specialised private investment groups, growth-oriented firms and those with a healthcare focus; as part of what they expect to be a wave of consolidation in the industry. (FT)

Sobi (SOBI SS) - Pivotal VALIANT results presented at Kidney Week show pegcetacoplan treatment effect in patients with C3G / primary IC-MPGN. All secondary endpoints favoured treatment with pegcetacoplan. (Sobi)

BROKER MOVES

Neste (NESTE FH) downgraded to Equal Weight from Overweight at Morgan Stanley

US

CLOSES: SPX -0.03% at 5,808, NDX +0.59% at 20,352, DJIA -0.61% at 42,114, RUT -0.49% at 2,208.

SECTORS: Communication Services +0.71%, Technology +0.59%, Consumer Discretionary +0.48%, Energy +0.06%, Industrials -0.25%, Health -0.53%, Materials -0.64%, Real Estate -0.76%, Consumer Staples -0.76%, Financials -1.05%, Utilities -1.46%.

Apple (AAPL) - Working on separate effort to make no-prick blood sensor and is exploring products that can counter diabetes epidemic; Apple staff tests blood-sugar app in sign of health ambitions. (Newswires)

Boeing (BA) - Reportedly explores sale of space business, according to WSJ. Elsewhere, is said to plan an over USD 15bln capital raise as soon as Monday, according to Bloomberg. (WSJ / Bloomberg)

Eli Lilly (LLY) - Received approval to launch weight-loss drug in Hong Kong, according to Bloomberg. (Bloomberg)

28 Oct 2024 - 06:58- Research Sheet- Source: Newsquawk