Newsquawk Daily European Equity Opening News - 5th September 2024

5th September 2024

ASIA

APAC stocks eventually traded mixed following the earlier mild regional gains, with the overall market tone tentative ahead of a slew of US data ahead of NFP on Friday. ASX 200 was kept afloat by its Tech and Real Estate sectors whilst Energy resided at the bottom. Nikkei 225 was choppy on either side of 37k as it saw initial pressure amid the stronger JPY, with the index later entirely trimming losses, only to falter once again. Hang Seng and Shanghai Comp were mixed for most of the session, Hang Seng initially saw modest gains with Banks and Real Estate initially supported following reports China mulls cutting mortgage rates in two steps to shield banks, via Bloomberg sources. That being said, the mood later waned despite a lack of catalysts, although pre-market reports suggested JPMorgan cut China stocks to Neutral from Overweight.

Chinese Stocks - JPMorgan cuts China stocks to neutral from overweight. (Newswires)

Nikkei Reshuffle - Nomura Research Institute (4307 JP) and Ryohin Keikaku (7453 JP) will be added to the Nikkei 225 on Oct. 1st in the semi-annual reshuffle. DIC Corp (4631 JP) and Nippon Paper Industries (3863 JP) will be removed, Nikkei said. (Newswires)

Nippon Steel (5401 JT) - US President Biden reportedly prepares to block the Nippon Steel acquisition of US Steel (X), according to WaPo citing sources. (WaPo)

EUROPEAN CLOSES

CLOSES: DAX: -0.83% at 18,590.95, FTSE 100: -0.35% at 8,269.60, CAC 40: -0.98% at 7,500.97, Euro Stoxx 50: -1.28% at 4,849.55, AEX: -1.31% at 896.98, IBEX 35: -0.58% at 11,213.90, FTSE MIB: -0.54% at 33,682.26, SMI: -1.48% at 12,164.85, PSI: +0.49% at 6,739.83.

SECTORS: Telecoms 0.44%, Utilities 0.17%, Consumer Stpl -0.48%, Financials -0.52%, Materials -0.77%, Energy -0.88%, Industrials -0.91%, Healthcare -0.94%, Consumer Disc -2.26%, IT -3.85%

FTSE 100

Rolls Royce (RR/ LN) / Airbus (AIR FP) - Cos to brief airlines on Cathay Pacific A350-1000 engine incident on Thursday, via Reuters citing sources. Airliners are likely to be told there is no immediate need for global A350 engine checks but regulators have the final say. (Newswires)

Ex-dividends - DS Smith (SMDS LN), Croda (CRDA LN), IAG (IAG LN), Aviva (AV/ LN), Admiral (ADM LN), Antofagasta (ANTO LN), Prudential (PRU LN)

OTHER UK COMPANIES

BROKER MOVES

DAX

Qiagen (QIA GY), Eli Lilly (LLY) - Qiagen has partnered with Eli Lilly to develop a QIAstat-Dx in-vitro diagnostic for detecting APOE genotypes, crucial for diagnosing Alzheimer's disease. This will be the first commercial IVD for APOE genotyping and the first clinical use of Qiagen's QIAstat-Dx in neurodegenerative diseases. (Newswires) 

OTHER GERMAN COMPANIES

BROKER MOVES

Lanxess (LXS GY) upgraded to Overweight from Underweight at Morgan Stanley; increases PT to EUR 37 (prev. 23) Shares +3.5% in pre-market trade

Wacker Chemie (WCH GY) upgraded to Overweight from Equal Weight at Morgan Stanley Shares +3.5% in pre-market trade

CAC

OTHER FRENCH COMPANIES

BioMerieux (BIM FP) - H1 (EUR): Op. Income 288mln (prev. 209mln Y/Y), Net Income 215mln (prev. 162mln Y/Y). FY Guidance: Sales are expected to grow by +8-10% (prev. guided +6-8%).

BROKER MOVES

Arkema (AKE FP) upgraded to Overweight from Equal Weight at Morgan Stanley

Air Liquide (AI FP) downgraded to Underweight from Equal Weight at Morgan Stanley

PAN EUROPE

AI Names - The US, UK and Brussels are set to sign agreements on AI standards, according to FT. (FT)

ASML (ASML NA) - CEO repeats 2024 and 2025 guidance; says chip market recovery is uneven. China's business supplying equipment to make older chips will remain strong. China business will return to 20%-30% of sales in coming years. When asked about possible restrictions on servicing tools in China, ASML CEO says machines will keep running. There's a strong will in the US for more export restrictions. Discussion on export controls will continue but expect more pushback against the US. Chinese advances in chipmaking while using DUV tools will slow, suffer poor yields. (Newswires)

Luxury Names - Tiffany is planning to downsize its flagship store in Shanghai, as luxury sales continue to fall in China, via Bloomberg. (Bloomberg)

Stellantis (STLAM IM/ STLAP FP) - Co. to resume production at certain US plants after production adjustments, via Reuters. (Reuters)

BROKER MOVES

SMI

Logitech (LOGN SW) - Approved all proposals, including an increase to its dividend to CHF 1.16/shr (prev. 1.06/shr Y/Y). Founder Borel fails in an attempt to oust Chairperson Becker, who was re-elected with 86% of the vote at the AGM. (Newswires)

Helvetia (HELN SW) - H1 (CHF): Fee and commission income increased to 210.7mln (prev. 194.4mln Y/Y). (Newswires)

OTHER SWISS COMPANIES

BROKER MOVES

Galderma (GALD SW) initiated with Buy at Berenberg

SCANDINAVIA

Tomra (TOM NO) - A new target of achieving>18% Return on Capital employed by 2026 is being introduced. Dividend policy of paying 40-60% of EPS and target to be an investment grade company are maintained. Ambition is to grow 15% annually and to achieve an EBITA margin of 18%. (Newswires)

BROKER MOVES

US

CLOSES: SPX -0.16% AT 5,520, NDX -0.20% at 18,921, DJIA +0.09% at 40,974, RUT -0.34% at 2,141

SECTORS: Energy -1.41%, Materials -0.48%, Technology -0.41%, Communication Services -0.38%, Health -0.14%, Consumer Discretionary -0.05%, Financials +0.09%, Industrials +0.11%, Real Estate +0.25%, Consumer Staples +0.52%, Utilities +0.85%.

Hewlett Packard Enterprise Co (HPE) - Q3 2024 (USD): Adj. EPS 0.50 (exp. 0.47), Revenue 7.71bln (exp. 7.67bln). Revenue Breakdown: Server 4.28bln (exp. 4.29bln). Hybrid cloud 1.30bln (exp. 1.29bln). Intelligent Edge 1.12bln (exp. 1.12bln). Financial Services 879mln (exp. 879.6mln). Corporate Investments and Other 262mln (exp. 252.4mln). Key Metrics: Adj. operating margin 10% (exp. 10%). Adj. gross margin 31.8% (exp. 33.4%). Cash flow from operations 1.15bln (exp. 1.46bln). Free cash flow 669mln (exp. 813.8mln). Q4 Guidance: Adj. EPS 0.52-0.57 (exp. 0.54). Revenue 8.1-8.4bln (exp. 8.15bln). FY Guidance: Adj. EPS 1.92-1.97 (prev. 1.85-1.95, exp. 1.92). Free cash flow 1.9bln (prev. at least 1.9bln, exp. 2.21bln). Still sees revenue adj. for currency +1-3%. (Newswires)

Intel (INTC) - CFO says co. will see most of the savings from cost cuts in 2025, noting cost cuts will be finished by the current quarter earnings release, via Citi tech conference. 'Not likely to see money' until the end of this year from US CHIPS act. Foundry will see meaningful revenue from customers it is currently in talks within 2027. (Newswires)

NVIDIA (NVDA) - Says they have not been subpoenaed by DoJ, according to Bloomberg. (Bloomberg)

Verizon (VZ) - Reportedly in advanced talks to acquire Frontier Communications (FYBR) in a deal that would bolster the company’s fibre network to compete with rivals including AT&T (T), according to WSJ citing sources. (WSJ)

05 Sep 2024 - 06:54- Research Sheet- Source: Newsquawk