Newsquawk Daily European Equity Opening News - 7th January 2025

ASIA

APAC stocks were mostly higher following the tech strength stateside where Nvidia briefly reclaimed the largest market cap title and closed at a fresh record. ASX 200 eked mild gains as strength in tech and telecoms picked up the slack from the weakness in the utilities, miners and materials sectors, while advances were limited amid disappointing Building Approvals data which showed a wider-than-expected contraction. Nikkei 225 outperformed on a break above the 40,000 level with the index propelled by a weaker currency. Hang Seng and Shanghai Comp were pressured from early in the session with heavy losses in Hong Kong after the Pentagon added several companies including Tencent (700 HK) and CATL to the US list of firms alleged to help Beijing's military, while the downside in the mainland was gradually cushioned following the announcement that China is to hold a briefing on consumer goods trade-in program on Wednesday involving officials from the PBoC, MoF and NDRC.

Mediatek (2454 TW) - Collaborates with Nvidia (NVDA) on the new Nvidia GB10 Grace Blackwell Superchip powering the Nvidia Project Digits personal AI supercomputer

Zijin Mining (ZIJMY) - China's Zijin Mining Group plans to begin lithium production in the Democratic Republic of Congo from early 2026, at a site containing one of the world’s largest lithium deposits. The project is subject to a legal dispute, with AVZ Minerals seeking to recover its exploration license.

EUROPEAN CLOSES

CLOSES: DAX: +1.53% at 20,210, FTSE 100: +0.31% at 8,250, CAC 40: +2.24% at 7,446, Euro Stoxx 50: +2.35% at 4,986, AEX: +0.79% at 892, IBEX 35: +1.34% at 11,808, FTSE MIB: +1.91% at 34,781, SMI: +0.49% at 11,681, PSI: -0.15% at 6,435.

SECTORS: IT 4.88%, Consumer Disc 1.85%, Financials 1.12%, Industrials 1.07%, Materials 0.88%, Energy 0.81%, Healthcare -0.09%, Utilities -0.31%, Consumer Stpl -0.45%, Telecoms -0.85

FTSE 100

UK Consumer Spending - Barclays UK December consumer spending was flat Y/Y vs December 2023. (Newswires)

UK BRC Sales - UK BRC Total Sales YY (Dec) 3.2% (Prev. -3.3%), largest increase since March; BRC Retail Sales YY (Dec) 3.1% (Prev. -3.4%); BRC Chief said "Following a challenging year marked by weak consumer confidence and difficult economic conditions, the crucial 'golden quarter' failed to give 2024 the send-off retailers were hoping for". (Newswires)

OTHER UK COMPANIES

Just Eat Takeaway (JET LN) - Completes the sale of GrubHub. (Newswires)

BROKER MOVES

Antofagasta (ANTO LN) upgraded to Outperform from Marketperform at Bernstein

AJ Bell (AJB LN) downgraded to Sell from Neutral at Citi

Berkely Group (BKG LN) upgraded to Overweight from Equalweight at Barclays

Mondi (MNDI LN) downgraded to Neutral from Outperform at BNP Paribas

Raspberry Pi (RPI LN) downgraded to Reduce from Buy at HSBC

Shell (SHEL LN) upgraded to Overweight from Equalweight at Morgan Stanley

Taylor Wimpey (TW/ LN) downgraded to Equalweight from Overweight at Barclays

DAX

Mercedes Benz (MBG GY) - Handelsblatt reports, citing insiders, that the Co. could soon abandon its ambitious profitability targets. A co. exec said that the 14% op. margin target is no longer "realistic", noting that "I don't see how we are going to achieve that in the foreseeable future". (Handelsblatt)

OTHER GERMAN COMPANIES

BROKER MOVES

Adidas (ADS GY) upgraded to Outperform from Marketperform at Bernstein

CAC

Sodexo (SW FP) - Q1 (EUR): Revenue 6.4bln (co. consensus 6.50bln), Organic Growth +4.6% (co. consensus +5.3%). Maintains FY25 guidance. (Newswires)

Vinci (DG FP) - Two subsidiaries of Vinci contribute to wastewater evacuation project in New York. (Newswires)

OTHER FRENCH COMPANIES

BROKER MOVES

TotalEnergies (TTE FP) downgraded to Equalweight from Overweight at Morgan Stanley;

PAN EUROPE

InPost (INPST NA) - FY24 Total Parcel Volume 1.09bln (exp. 1.08bln). Says based on strong Q4 trading results, co. feels comfortable with FY outlook communicated in November. (Newswires)

Beuty names / L'Oreal (OR FP) / Beiersdorf (BEI GY) - Ulta Beuty (ULTA) sees Q4 operating margins exceeding the prior 11.6-12.4% guidance range. details in the US section below

Luxury Watches - Prices for premium used Swiss watches, including Rolex, Patek Philippe, and Audemars Piguet, fell in 2024, marking a third consecutive year of price declines, Bloomberg reports. BBG's "Subdial Watch Index" dropped nearly 6% in 2024, a three-year. (Bloomberg)

Telecom Italia (TIT IM) - Board to meet on 15th January to discuss sparkle unit sale ahead of expected January 22nd decision, according to sources via Reuters. (Reuters)

BROKER MOVES

Eni (ENI IM) downgraded to Equalweight from Overweight at Morgan Stanely

Repsol (REP SM) downgraded to Underweight from Equalweight at Morgan Stanley; MS sees limited scope to deliver shareholder distributions at current levels.

SMI

Helvetia (HELN SW) - Co. is said to be considering the sale of its German unit, which could be worth as much as CHF 600mln, according to Bloomberg. (Bloomberg)

OTHER SWISS COMPANIES

DKSH (DKSH SW) - Acquired CLMO, a tech solutions provider in Malaysia and Vietnam. (Newswires)

Julius Baer (BAER SW) - To sell its domestic Brazilian business to BTG Pactual. Transaction expected to be approx. 30bps accretive to co's CET1 capital ratio at close. Total cash consideration of CHF 91mln. (Newswires)

BROKER MOVES

SCANDINAVIA

BROKER MOVES

Equinor (EQNR NO) upgraded to Overweight from Equalweight at Morgan Stanley

Novo Nordisk (NOVOB DC) upgraded to Market Perform from Underperform at Bernstein; says stock valuation has turned "more compelling" after the 40% decline from ATHs.

US

CLOSES: SPX +0.55% at 5,975, NDX +1.09% at 21,559, DJIA -0.06% at 42,707, RUT -0.08% at 2,267

SECTORS: Real Estate -1.4%, Utilities -1.09%, Consumer Staples -0.98%, Financials -0.42%, Energy -0.41%, Industrials -0.21%, Health -0.02%, Consumer Discretionary +0.61%, Materials +0.66%, Technology +1.44%, Communication Services +2.13%.

AbbVie (ABBV) - AbbVie lowered its profit view; sees Q4 adj. EPS between 2.06-2.10 (exp. 2.98), and sees FY24 between USD 10.02-10.06 (exp. 10.94) due to USD 1.6bln in acquisition expenses, including milestone and R&D costs, which it will recognise in Q4. The updated guidance follows over USD 20bln billion in deals to expand its pipeline after Humira's patent loss.

Deere & Co. (DE) - Deere introduced its new autonomous fleet at CES 2025, extending its driverless technology beyond Midwest farms to orchards, quarries, and lawns. The machines aim to address labour shortages by taking on hard-to-fill tasks like spraying and hauling.

Inari Medical (NARI), Stryker (SYK) - Stryker agreed to acquire Inari Medical for USD 4.9bln, paying USD 80/shr. The deal expands Stryker's portfolio in venous disease treatments. The transaction is expected to close Q1 2025.

Nvidia (NVDA) - At CES 2025, Nvidia CEO unveiled its GeForce RTX 50 series GPU (RTX 5070-5090, priced USD 549-1,999) featuring Blackwell architecture and GDDR7 memory. It also introduced Project Digits, a USD 3,000 AI supercomputer with the GB10 Grace Blackwell Superchip, and announced AI advancements for robotics and self-driving cars.

Phillips 66 (PSX) - Phillips 66 is acquiring EPIC NGL from Ares-backed EPIC Y-Grade for USD 2.2bln in cash, strengthening its natural gas liquids portfolio.

Ulta Beauty (ULTA) - Ulta Beauty announced CEO Dave Kimbell’s retirement, and has appointed Kecia Steelman as new President and CEO. The company also reported stronger-than-expected holiday performance, modest Q4 comparable sales growth; sees Q4 operating margins exceeding the prior 11.6-12.4% guidance range.

07 Jan 2025 - 06:57- Research Sheet- Source: Newsquawk