Newsquawk Daily European Equity Opening News - 3rd March 2023

3rd March 2023

ASIA

Asia-Pac stocks traded mostly higher amid tailwinds from the US where risk appetite was bolstered by comments from Fed's Bostic that they could be in a position to pause by mid-to-late summer and as the region also digested further strong Chinese Caixin PMI data. ASX 200 (+0.4%) was led by strength in telecoms healthcare and financials albeit with gains limited ahead of next week’s RBA meeting where the central bank is widely expected to hike again. Nikkei 225 (+1.6%) outperformed after recent data which showed Tokyo-area headline and core inflation began to soften and the Unemployment Rate edged lower, while a recent source report noted that the BoJ is to prefer watching how the impact of earlier policy tweaks works out for now. Hang Seng (+0.7%) and Shanghai Comp. (+0.1%) gained after strong Caixin Services and Composite PMI data which showed the fastest pick-up in activity since August. However, upside was capped heading into China’s ‘Two Sessions’ where participants will be eyeing a major overhaul of President Xi’s leadership team and the Government Work Report including this year’s official growth target, while US-China frictions continued to linger with the Biden administration adding 28 Chinese entities to the US trade blacklist.

Foxconn (2317 TT) - Apple (AAPL) supplier Foxconn is planning a USD 700mln Indian plant in a shift from China. (Newswires)

Renesas (6723 JT) - Opened joint semiconductor R&D centres with Tata Consultancy Services in Bengaluru and Hyderabad, India. (Newswires)

SoftBank (9984 JT) - Co. and its Arm unit have determined pursuing a US only listing of Arm is the best path forward and Arm announces new plans to further increase presence in the UK with opening of a new site in Bristol and continued headcount growth. (Newswires)

EUROPEAN CLOSES

CLOSES: EURO STOXX 50 +0.59% at 4,240, FTSE 100 +0.37% at 7,944, DAX 40 +0.15% at 15,327, CAC 40 +0.69% at 7,284, FTSE MIB +0.30% at 27,397, IBEX 35 +0.05% at 9,327, SMI +1.03% at 11,170.

SECTORS: Energy 1.67%, Consumer Stpl 1.48%, Healthcare 0.82%, Materials 0.75%, Utilities 0.74%, Consumer Disc 0.62%, IT 0.30%, Industrials 0.07%, Telecoms 0.07%, Financials -0.48%

FTSE 100

BAE Systems (BA/ LN) - Co. has won a US army contract worth just under USD 250mln. (Newswires)

Mining names - BHP (BHP AT) has signed contracts with Shandong ports, via Global Times; which accounts for circa. 1/4 of China's annual iron ore throughput. (Global Times)

Carnival Cruise Line (CCL LN) - Co. said it will expand its offering of seasonal European sailings in 2024. (Newswires)

OTHER UK COMPANIES

Admiral Group (ADM LN) downgraded to Neutral from Buy at Citi

Pennon (PNN LN) upgraded to Hold from Sell at Deutsche Bank

BROKER MOVES

DAX

Deutsche Lufthansa (LHA GY) - Q4 2022 (EUR): Revenue 8.88bln (exp. 9.02bln). Adj. EBIT 575mln (exp. 556.3mln). Co. sees a significant improvement in EBIT in 2023. Co. sees Asia capacity significantly lagging Europe and the US. Co. sees FY capacity rising to 85-90%. (Newswires)

Infineon Technologies (IFX GY) - Co. is to acquire Gan Systems for USD 830mln. (Newswires)

OTHER GERMAN COMPANIES

BROKER MOVES

Hapag-Lloyd (HLAG GY) reiterated with Underweight at JPMorgan Chase

Knorr-Bremse (KBX GY) downgraded to Hold from Buy at Deutsche Bank

Porsche (PAH3 GY) downgraded to Hold from Buy at HSBC

Software AG (SOW GY) upgraded to Equal Weight from Underweight at Morgan Stanley

CAC

OTHER FRENCH COMPANIES

Eiffage (FGR FP) - Co. and NGE consortium has been awarded a EUR 230mln contract. (Newswires)

BROKER MOVES

Arkema (AKE FP) upgraded to Buy from Neutral at Goldman Sachs

Scor (SCR FP) reiterated with Underweight at JPMorgan Chase

PAN EUROPE

Auto names - An EU debate scheduled for Friday over the combustion engine ban has been taken off the agenda, according to Bloomberg. (Newswires)

Elia (ELIA BB) - FY 2022 (EUR): Revenue 4.11bln (prev. 2.86bln Y/Y). Adj. Net 408.2mln (prev. 328.3mln). (Newswires)

Ferrovial (FER SM) - Spanish PM Sanchez said the government is to check the legality of Ferrovial's exit plan. (Newswires)

ING (INGA NA) - Co. is to nominate Karl Guha as its supervisory board chairman. (Newswires)

Salvatore Ferragamo (SFER IM) - FY22 (EUR): Net 69.6mln (exp. 73mln), Revenue 1.25bln (prev. 1.25bln). EBITDA 298.9mln (exp. 292.5mln). Co., in its earnings call, said, the beginning of the year has been encouraging in mainland China, and does not see the need to move price levels significantly. Co. said no major store openings are expected in 2023 and the group is reducing exposure in the US. (Newswires)

Universal Music Group (UMG NA) - Q4 2022 (EUR): Adj. EBITDA 620mln (exp. 612mln), Revenue 2.94bln (exp. 2.88bln). (Newswires)

BROKER MOVES

Generali (G IM) upgraded to Neutral from Underweight at JPMorgan Chase

Stellantis (STLAM IM/STLAP FP) upgraded to Outperform from Sector Perform at RBC

SMI

Clariant (CLN SW) - Swiss bourse regulator is to reportedly propose sanctions against the Co. over financial report misstatements in 2020 and 2021, according to reports. (Newswires)

OTHER SWISS COMPANIES

BROKER MOVES

Schindler Holdings (SCHP SW) downgraded to Reduce from Hold at HSBC

Zurich Insurance (ZURN SW) downgraded to Underweight from Overweight at JPMorgan Chase

SCANDINAVIA

Equinor (EQNR NO) - Co. is to acquire Suncor Energy UK for a consideration of USD 850mln. (Newswires)

Ericsson (ERICB SS) - Ericsson agreed to pay a USD 206mln penalty and pleaded guilty to violating the anti-bribery provisions of the Foreign Corrupt Practices Act. (CNBC)

Nokia (NOKIA FH) - Co. aims to maintain a net cash position of 10-15% of sales and aims to ensure it can continue to invest in the necessary R&D. (Newswires)

BROKER MOVES

AB SKF (SKFB SS) downgraded to Hold from Buy at HSBC

Boliden (BOL SS) downgraded to Underweight from Neutral at JPMorgan Chase

Hexagon (HEXAB SS) downgraded to Hold from Buy at HSBC

Vestas Wind Systems (VWS DC) downgraded to Reduce from Hold at HSBC

US

CLOSES: SPX +0.76% at 3,981, NDX +0.89% at 12,045, DJIA +1.05% at 33,003, RUT +0.22% at 1,903

SECTORS: Utilities +1.82%, Technology +1.26%, Real Estate +1.22%, Consumer Staples +1.21%, Materials +1.2%, Industrials +1.2%, Communication +1/1%, Energy +0.84%, Health Care +0.58%, Consumer Discretionary -0.32%, Financials -0.53%.

AMD (AMD) - Daniel Loeb's Third Point takes a passive stake in AMD, according to CNBC. (Newswires)

Broadcom Inc (AVGO) - Q1 2023 (USD): Adj. EPS 10.33 (exp. 10.12), Revenue 8.915bln (exp. 8.9bln). Q2 revenue view 8.7bln (exp. 8.58bln). Q2 adj. EBITDA guidance of c. 64.5% of projected revenue. Semiconductor Solutions 7.11bln (exp. 6.98bln), Infrastructure Software 1.81bln (exp. 1.88bln). CEO said forecast ethernet switch shipments used in A.I. could grow to USD 800mln in 2023 citing expected exponential demand from hyperscalers. (Newswires) Shares rose 0.7% after-market.

Dell Technologies Inc (DELL) - Q4 2023 (USD): Adj. EPS 1.80 (exp. 1.63), Revenue 25.0bln (exp. 23.37bln). Raises annual cash dividend by 12% to USD 1.48/shr. CFO Tom Sweet is to retire and Yvonne McGill was named CFO effective Q3 FY24. (Newswires) Shares fell 2.9% after-market.

03 Mar 2023 - 06:45- Research Sheet- Source: Newsquawk