Newsquawk Daily European Equity Opening News - 4th May 2023

4th May 2023

ASIA

APAC stocks were mixed in the aftermath of the FOMC meeting where the Fed delivered a widely expected 25bps rate hike and paved the way for a pause, although Fed Chair Powell pushed back against cutting rates this year and alluded to banks tightening lending standards and slowing the pace of lending.ASX 200 was lacklustre amid weakness in its top-weighted financial sector after big four bank NAB's H1 profit missed analysts’ estimates, although losses were cushioned by resilience in mining names and improved trade data. KOSPI was subdued as participants digested mixed earnings results, while Nikkei 225 remain closed. Hang Seng and Shanghai Comp. were firmer as mainland participants returned from the golden week break with Chinese markets shrugging off the surprise contraction in Caixin Manufacturing PMI and the PBoC’s significant liquidity drain, as well as the HKMA’s 25bps rate hike in lockstep with the Fed.

EUROPEAN CLOSES

CLOSES: Euro Stoxx 50 +0.36% at 4,310, FTSE 100 +0.20% at 7,788, DAX 40 +0.56% at 15,815, CAC 40 +0.28% at 7,403, FTSE MIB +0.77% at 26,835, IBEX 35 -0.06% at 9,076, SMI +0.74% at 11,508.

SECTORS: Materials 0.91%, Healthcare 0.75%, Consumer Disc 0.71%, Industrials 0.58%, IT 0.49%, Consumer Stpl 0.45%, Utilities 0.13%, Telecoms 0.10%, Financials -0.11%, Energy -0.70%

FTSE 100

AstraZeneca (AZN LN) - Chair Demare believes that pay increases in recent years for CEO Soriot have removed the threat of him leaving for a US role. In the context of reports that Soriot had early-stage talks with Biogen (BIIB) in 2022, via FT citing sources. (FT)

Ex-Divs - Glencore (GLEN LN), St. James's Place (STJ LN), Admiral Group (ADM LN), and Hiscox (HSX LN) will trade without entitlement to their latest dividend payout. (dividenddata)

Flight Names - Unite union workers at Heathrow are to walk out between May 4th-6th, 9th-10th and 25th-27th. (Sky News)

Rio Tinto (RIO LN) - Co. said it stabilised its performance in H2 and has carried strong momentum into 2023. (Newswires)

Vodafone (VOD LN) - Co. and CK Hutchinson (1 HK) are poised to unveil a GBP 15bln UK mobile tie-up, via FT citing sources; deal is reportedly to be announced in May (FT)

OTHER UK COMPANIES

BROKER MOVES

Flutter Entertainment (FLTR LN) downgraded to Equal Weight from Overweight at Wells Fargo

DAX

BMW (BMW GY) - Q1 2023 (EUR): Revenue 36.9bln (exp. 35.5bln). EBIT 5.4bln (exp. 3.7bln). Auto Revenue 31.3bln (exp. 30.1bln). Co. sees FY Auto EBIT between 8-10% (exp. 9%). Co. confirms its FY outlook. Co. approves second buyback programme of up to EUR 2bln. (Newswires)

Henkel (HEN3 GY) - Q1 2023 (EUR): Revenue 5.6bln (exp. 5.5bln). Organic Sales +6.6% (exp. +4.9%). Co. maintains its FY outlook. (Newswires)

Infineon (IFX GY) - Q1 2023 (EUR): Revenue 4.1bln (exp. 4.0bln). Co. sees Q3 segment result margin around 26.0% (exp. 25.1%). Co. guides Q3 revenue around 4bln (exp. 4bln). Co. raises FY revenue outlook to around 16.2bln (prev. 15.5bln), and raises adj. gross margin guidance to around 47% (prev. around 45%). (Newswires/Infineon)

Volkswagen (VOW3 GY) - Q1 2023 (EUR): Revenue 76.2bln (exp. 72.3bln). Adj. operating profit 5.8bln (exp. 5.5bln). Adj. Operating Margin 7.5% (exp. 6.9%). Co. maintains its FY outlook from March. (Newswires)

Vonovia (VNA GY) - Q1 2023 (EUR): Total Segment Revenue 1.43bn (exp. 1.63bln Y/Y). FFO 0.58 (prev. 0.73). Adj. EBIT -9.8% Y/Y. Co. has affirmed its FY23 FFO and Adj. EBITDA guidance. Additionally, Vonovia sells five real estate properties for EUR 560mln. (Newswires/dpa)

Zalando (ZAL GY) - Q1 (EUR): Revenue 2.26bln (exp. 2.23bln), Net -28.5mln (exp. -61mln), GMV 3.24bln, +2.8% YY. FY23 guidance confirmed. Delivers growth and profitability as more customers purchase through the shopping club and partner business share increases. (Newswires)

OTHER GERMAN COMPANIES

Fraport (FRA GY) - Q1 (EUR): Revenue 765mln (exp. 656mln). Passenger numbers in Frankfurt +56% YY. FY23 guidance confirmed. (Newswires)

MorphoSys (MOR GY) - Q1 2023 (EUR): Revenue 62.3mln (prev. 41.5mln y/Y). EPS -1.30 (prev. -3.59). Co. has affirmed its FY23 Monjubi sales and R&D Expense guidance. (Newswires)

BROKER MOVES

Beiersdorf (BEI GY) downgraded to Market Perform from Outperform at Bernstein

Deutsche Bank (DBK GY) upgraded to Buy from Neutral at Citi

CAC

Airbus (AIR FP)- Q1 2023 (EUR): EPS 0.59 (exp. 0.69), Revenue 11.8bln (exp. 11.37bln), EBIT 400mln (exp. 747mln), adj. FCF -900mln (exp. -1.09bln); Affirms FY23 outlook. COMMENTARY: Targets a rate of 4 for A330 in 2023 and rate of 9 for A350 at the end of 2025. Production planning for A320 has not changed recently. There are issues with in-service support of Pratt & Whitney (RTX) GTF engines. H1 '23 deliveries to be significantly lower than H2 '23. Last four months of the year will contribute very strongly to annual deliveries. Supply chain problems include electronic chips, aerostructures, engines, labour, and seats. Some small suppliers are finding it difficult to finance production ramp-up. Execution of A350 freighter taking slightly longer than expected; first freighter expected to be delivered beginning in 2026. Supply chain pressures are very likely to last throughout 2023. (Airbus IR) CEO said they are seeing persisting supply chain issues, including for airplane engines. (Newswires)

Capgemini (CAP FP) - Q1 (EUR): Revenue 5.73bln (exp. 5.57bln), Bookings 5.87bln, +6.5%. FY23 guidance confirmed. (Newswires)

L'Oreal (OR FP) - Estee Lauder (EL) CFO said shipments to Hainan will still be down into Q4 and difficult to know when travel in China and Korea will normalise, and added that small and indie brands in the US have taken share gains away from large beauty companies. (Newswires)

OTHER FRENCH COMPANIES

BROKER MOVES

Eurazeo (RF FP) initiated with Outperform at Exane BNP

L'Oreal (OR FP) downgraded to Market Perform from Outperform at Bernstein

PAN EUROPE

AB InBev (ABI BB) - Q1 2023 (EUR): Organic revenue growth +13.2% (exp. +10.9%). Organic Adj. EBITDA +13.6% (exp. +4.9%). Co. maintains its FY organic Adj. EBITDA and revenue guidance. (Newswires)

ArcelorMittal (MT NA) - Q1 2023 (EUR): Revenue 18.5bln (exp. 17.6bln). EBITDA 1.8bln (exp. 1.7bln). Co. is to buyback up to 85mln shares through to May 2025. Co. said world ex-China apparent steel consumption growth for FY23 forecast at 2-3% vs 2022. Co. said Overall economic sentiment has improved, driven by Europe, but remains relatively subdued. Automotive recovery is supportive to flat rolled products. Destocking has concluded, resulting in an improvement in apparent demand and tightening supply/demand. Inventories lower than normal as restocking is yet to take place. (Newswires)

Enel SpA (ENEL IT) - Q1 23 (EUR): Net 1.51bln (prev. 1.44bln), EBITDA 5.46bln (exp. 5.3bln; prev. 4.49bln), Revenue 26.4bln (prev. 35.0bln). Co. affirms its FY23 Net and EBITDA guidance. (Newswires)

Leonardo (LDO IM) - Q1 2023 (EUR): Net 542mln, EBITA 105mln (prev. 132mln), Revenue 3.0bln (exp. 3.1bln), March-end backlog at 39.1bln, equal to more than 2.5yrs of production. CEO rules out Hensoldt buying Co's defence electronics segment. (Newswires)

Post Italiane (PST IM) - Q1 2023 (EUR): Revenue 3.04bln (exp. 3.01bln). Net 767mln (exp. 699mln). EBIT +11.2% Y/Y. Co. affirms its FY23 guidance. (Newswires)

BROKER MOVES

Signify (LIGHT NA) maintained with Overweight at JPMorgan Chase

SMI

Swisscom (SCMN SW) - Q1 2023 (CHF): Revenue 2.74bln (prev. 2.75bln Y/Y). EBITDA 1.16bln (prev. 1.14bln). Capex 545mln (prev. 522mln Y/Y). Co. has affirmed its FY23 EBITDA Revenue and Capex guidance. (Newswires)

Swiss Re (SREN SW) - Q1 (USD): Net 643mln (exp. 600mln). CEO says Q1 results demonstrate the resilience of all main businesses. Continue to focus on achieving an ambitious profit target of over USD 3bln for 2023. (Newswires)

OTHER SWISS COMPANIES

Adecco (ADEN SW) - Q1 2023 (EUR): Revenue 5.89bln (exp. 5.85bln). Adj. EBITDA 184mln (exp. 171mln). Net Income 92mln (exp. 57.6mln). (Newswires)

GAM (GAM SW) - FY22 (CHF): Underlying pretax -42.5mln (prev. -9.6mln Y/Y). Co's Board recommends selling its business to LionTrust. (Newswires)

BROKER MOVES

SCANDINAVIA

Aker Solutions (AKSO NO) - Q1 2023 (NOK): Revenue 11.4bln (prev. 11.7bln). EBITDA 906mln (exp. 837mln). EBITDA margin 7.9% (prev. 7.0%). Co. said the outlook looks positive. (Newswires)

Equinor (EQNR NO) - Q1 2023 (USD): Adj. Operating profit 12bln (exp. 10.9bln). Adj. Net 3.51bln (exp. 3.28bln). Co. is to pay an extraordinary cash dividend of USD 0.60/shr in Q1. Co. is to start the second tranche of its 2023 share buyback for around USD 1.7bln. (Newswires)

Telenor (TEL NO) - Q1 (NOK): Service Revenue 14.9bln, +0.4bln; Organic OpEx +0.3bln; Reported EBITDA 8.1bln, +2%; Net Income 18.1bln, gain of 18.5bln recognised upon the closure of the dtac and True Corporation merger. Maintain FY23 guidance. (Newswires)

BROKER MOVES

US

CLOSES: SPX -0.70% at 4,090, NDX -0.64% at 13,030, DJIA -0.80% at 33,414, RUT +0.41% at 1,739.

SECTORS: Energy -1.92%, Financials -1.19%, Materials -1.11%, Technology -0.83%, Consumer Staples -0.79%, Consumer Discretionary -0.71%, Real Estate -0.59%, Industrials -0.38%, Utilities -0.32%, Communication Services -0.17%, Health -0.11%.

Albemarle Corp (ALB) - Q1 profits topped expectations, but the materials company lowered its FY outlook to reflect slumping lithium prices. Q1 adj. EPS 10.32 (exp. 7.03), Q1 revenue USD 2.58bln (exp. 2.73bln). Sees FY adj. EPS between 20.75-25.75, and sees FY net sales between USD 9.8-11.5bln (prev. 11.3-12.9bln).

Meta (META) - Co. sees FTC proposes new sanctions against the Co.; proposes blanket prohibition preventing Facebook from monetising youth data. (TechCrunch)

PacWest (PACW) - Co. said it has explored strategic asset sales and that core customer deposits have increased since March 31st with total deposits totalling USD 28bln as of May 2nd, adds will continue to evaluate all options to maximise shareholder value. (Newswires) Shares fell 52.5% after market.

Qualcomm Inc (QCOM) - Q2 2023 (USD): Adj. EPS 2.15 (exp. 2.15), Revenue 9.28bln (exp. 9.1bln). Sees Q3 adj. EPS USD 1.70-1.90 (exp. 2.20). Sees Q3 revenue USD 8.1bln-8.9bln (exp. 9.25bln). (Newswires)

Western Alliance (WAL) Co. said it has not experienced unusual deposit outflows following sale of First Republic and other recent industry news, adds deposits as of Tuesday rose to USD 48.8bln from USD 48.2bln on Monday and QTD deposits are up USD 1.2bln. (Newswires)

04 May 2023 - 06:55- Research Sheet- Source: Newsquawk