Newsquawk Daily European Equity Opening News - 6th December 2024

6th December 2024

ASIA

APAC stocks were mixed with some cautiousness in the region after the weak lead from Wall St and ahead of the key US jobs data. ASX 200 was dragged lower by early underperformance in tech and healthcare, while gold miners also suffered after initial declines in the precious metal. Nikkei 225 was the laggard and briefly fell beneath the 39,000 level despite encouraging Household Spending data. Hang Seng and Shanghai Comp were buoyed despite the lack of any major fresh catalysts heading into next week's trade and inflation data releases, as well as the Central Economic Work Conference where Chinese leaders are said to discuss economic growth and stimulus.

Honda (7267 JT) - November YTD China sales fell 30.7% Y/Y to 740.4k units. (Newswires)

EUROPEAN CLOSES

CLOSES: DAX: +0.67% at 20,367, FTSE 100: +0.16% at 8,349, CAC 40: +0.37% at 7,331, Euro Stoxx 50: +0.63% at 4,950, AEX: +0.31% at 894, IBEX 35: +1.57% at 12,119, FTSE MIB: +1.59% at 34,626, SMI: +0.01% at 11,781, PSI: +0.57% at 6,412.

SECTORS: Financials 1.61%, Telecoms 1.04%, Utilities 0.59%, Consumer Disc 0.53%, Consumer Stpl 0.33%, IT 0.00%, Materials -0.01%, Industrials -0.13%, Healthcare -0.44%, Energy -0.88%

FTSE 100

Aviva (AV/ LN)/ Direct Line (DLG LN) - Aviva is said to be nearing a prelim deal to take over Direct Line Insurance after Aviva sweetened its bid in the latest round of talks, according to Bloomberg sources. Direct Line could announce as soon as today that it could recommend the sweetened offer, but talks are ongoing and there is no certainty they will lead to a transaction, sources added. (Bloomberg) Note, it was reported yesterday thatAviva has reportedly increased its bid for Direct Line to GBP 2.61/shr from GBP 2.50/shr; Direct Line closed on Thursday at GBP 2.36.

Shell (SHEL LN) - Chevron (CVX) and Shell reportedly weighing a stake in Argentina oil export plan and negotiating pipeline with consortium led by YPF, according to Bloomberg. (Bloomberg)

OTHER UK COMPANIES

BROKER MOVES

AJ Bell (AJB LN) downgraded to Hold from Buy at Deutsche Bank

Halma (HLMA LN) upgraded to Neutral from Underweight at JPMorgan Chase

Severn Trent (SVT LN) downgraded to Hold from Buy at Jefferies

United Utilities (UU/ LN) downgraded to Hold from Buy at Jefferies

DAX

Adidas (ADS GY) - Adidas shares called to open +2% after Lululemon Athletica (LULU) shares rose 9% afterhours following a profit beat and raised guidance. (Lang & Schwarz)

Deutsche Boerse (DB1 GY) - Supervisory Board nominates Clara-Christina Streit as new Chair; Mertin Jetter to resign after the 2025 AGM, as announced. (Newswires)

Volkswagen (VOW3 GY) - Workers are to strike for four hours on Monday at nine locations in Germany, according to the IG Metall union. (Newswires)

OTHER GERMAN COMPANIES

BROKER MOVES

Hannover Re (HNR1 GY) upgraded to Overweight from Equal Weight at Morgan Stanley

CAC

L'Oreal (OR FP) - Ulta Beauty Inc (ULTA) shares rose 12.2% after topping EPS, Revenue, and Comp sales expectations whilst FY sales guidance was maintained. (Newswires)

OTHER FRENCH COMPANIES

BROKER MOVES

Scor (SCR FP) upgraded to Overweight from Equal Weight at Morgan Stanley

PAN EUROPE

Stellantis (STLAM IM/STLAP FP) and Zeta Energy announce agreement to develop lithium-sulphur EV batteries; expected to cost less than half of current lithium-ion batteries. (Newswires)

BROKER MOVES

SMI

Holcim (HOLN SW) - Holcim is progressing on the planned full capital market separation of its North American business, planned by way of a 100% spin-off to be listed on the New York Stock Exchange. The planned spin-off is subject to shareholder approval at the Holcim Annual General Meeting on 14 May 2025, and is expected to occur by the end of the first half 2025. Completion of the planned spin-off is subject to customary approvals. (Holcim)

Novartis (NOVN SW) - New Phase IIIB data shows Novartis Fabhalta® improved hemoglobin levels in adult patients with paroxysmal nocturnal hemoglobinuria who switched from anti-C5 therapy. (Novartis)

Swiss Life (SLHN SW) - Co. is to launch a share buyback of up to CHF 750mln. (Newswires)

OTHER SWISS COMPANIES

BROKER MOVES

Swiss Re (SREN SW) upgraded to Equal Weight from Underweight at Morgan Stanley

SCANDINAVIA

BROKER MOVES

US

CLOSES: SPX -0.19% at 6,075, NDX -0.31% at 21,425, DJIA -0.55% at 44,766, RUT -1.25% at 2,396

SECTORS: Materials -1.4%, Industrials -1.21%, Health -1.13%, Communication Services -0.51%, Real Estate -0.28%, Technology -0.18%, Financials +0.22%, Utilities +0.25%, Energy +0.34%, Consumer Staples +0.39%, Consumer Discretionary +0.95%.

Chevron (CVX) - Chevron plans to cut its 2025 capex budget to USD 14.5-15.5bln, its first reduction since 2021. It will scale back shale expansion, focusing on free cash flow and cost efficiency amidst weaker oil prices and Wall Street demands. It said restructuring and other charges expected to be between USD 1.1 -1.5bln in Q4; upstream spending is expected to be about USD 13bln in FY25, downstream CapEx is expected to be around USD 1.2bln in FY25, and Permian basin spend is seen between USD 4.5-5.0bln in FY25. (Newswires)

DocuSign (DOCU) - Q3 adj. EPS 0.90 (exp. 0.87), Q3 revenue USD 754.8mln (exp. 745.33mln), Q3 billings USD 752.3mln (+9% Y/Y). CEO highlighted strong innovation and early momentum in Intelligent Agreement Management. Sees Q4 revenue between USD 758-762mln (exp. 756.2mln), Q4 subscription revenue between USD 741-745mln, and Q4 billings between USD 870-880mln. For the FY25, narrows revenue guidance to USD 2.959-2.963bln (from 2.94-2.95bln; exp. 2.95bln), sees FY subscription revenue between 2.885-2.889bln, FY billings between USD 3.056-3.066bln. (Newswires)

Hewlett Packard Enterprise (HPE) - Q4 adj. EPS 0.58 (exp. 0.56), Q4 revenue USD 8.46bln (exp. 8.25bln); Q4 adj. operating margin 11.1% (exp. 10.8%), Q4 adj. gross margin 30.9% (exp. 31.1%); Q4 cash flow from operations USD 2bln (exp. 1.72bln), Q4 free cash flow USD 1.50bln (exp. 1.09bln). By segment, Q4 server revenue USD 4.71bln (exp. 4.76bln), hybrid cloud revenue USD 1.58bln (exp. 1.33bln), Intelligent Edge revenue USD 1.12bln (exp. 1.15bln). Sees Q1 adj. EPS between 0.47-.52 (exp. 0.48), and sees Q1 sales up in the mid-teens percentage (exp. +15%). Exec reiterates that it expects the Junpier transaction to close in early 2025. (Newswires)

Lululemon Athletica (LULU) - Shares rose 9% afterhours following a profit beat and raised guidance. Q3 EPS 2.87 (exp. 2.69), Q3 revenue USD 2.40bln (exp. 2.36bln). Authorised a USD 1bln increase in its share repurchase programme. Sees FY EPS between 14.08-14.16 (exp. 13.97), and sees FY sales between USD 10.45bln-10.49bln (exp. 10.42bln). (Newswires)

Ulta Beauty (ULTA) - Shares rose over 12% afterhours following a profit beat and lifted guidance. Q3 EPS 5.14 (exp. 4.54), Q3 revenue USD 2.53bln (exp. 2.5bln); Q3 comp sales +0.6% (exp. -1.9%), Q3 gross margin 39.7% (exp. 38.9%); Q3 merchandise inventories USD 2.37bln (exp. 2.37bln). Sees FY net sales between USD 11.1-11.2bn (prev. saw 11.0-11.2bln), sees FY EPS between 23.20-23.75 (prev. saw 22.60-23.50), and sees FY operating margin between 12.9-13.1% (prev. saw 12.7-13%). (Newswires)

06 Dec 2024 - 06:52- Research Sheet- Source: Newsquawk