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StreetAccount Summary - EU Market Recap: FTSE 100 (0.11%) to 7622.16, DAX (0.26%) to 16859.04, CAC40 (0.89%) to 7588.75, STOXX 600 (0.37%) to 483.86

Feb 01 ,2024

  • Synopsis:

    • European equity markets closed generally lower. Shares opened lower, as expected, and after paring losses, pan-European indices traded in a narrow range for much of the session slightly below the best levels of the day, before again moving lower into the close

    • With shares ending above the session lows, Finland (1.4%), Belgium (1.1%), Switzerland (1.0%) and France led underperformers, whilst among the handful of country benchmarks ending up on the day were Denmark +1.0% Greece +0.7% and Netherlands +0.5%

    • As the war in Ukraine continues, all 27 EU members have agreed on an additional €50B aid package for Ukraine. Also, Russia's President Putin will visit Turkey on 12-Feb to meet President Erdoğan and a North Korean delegation will visit the lower house of Russia's parliament on 13-Feb

    • With increasing optimism over a possible cease fire in Gaza, there appears to remain major differences between Hamas and Israel on what is required. Across Israel, there were protests demanding return of captives, whilst Qatar's PM warns if Israel's war on Gaza does not end soon, the risks of a greater regional conflict will grow. UK PM Sunak spoke with the Sultan of Oman

    • Riksbank kept its benchmark interest rate unchanged at 4.0%, as expected, whilst QT increased to SEK6.5B, lower than SEK7B expected

    • BOE left its benchmark interest rate unchanged at 5.25%, as expected, and the bank's projections for CPI is to fall temporarily to the 2% target in 2024 Q2 before increasing again in Q3 and Q4.

    • Norges Bank's Longva spoke at Drammen Chamber of Commerce and Bech-Moen spoke at the Foreign Exchange Seminar 2024. ECB's Lane delivered a lecture title "Monetary Policy and Inflation" at an event organised by Einaudi Institute for Economics and Finance (EIEF) (slides).

    • Jan manufacturing PMI releases dominated the economic data release and generally showed an improvement m/m for countries reporting it for the first time, the exceptions being Norway, Russia and Sweden, whilst final updates saw marginal changes for France and Germany, no change for the Eurozone, and a move lower for the UK. There was also a handful of Jan preliminary CPIs and Dec unemployment rates.

    • Some of the region's leading companies that saw smaller percentage moves in their share prices on the back of earnings/updates included ABB Limited (ABBN.SW) Q4 EPS $0.50 vs consensus $0.47 and OMV (OMV.AV) Q4 Clean CCS net income attributable €665M vs consensus €481M. Also, Shell (SHEL.LN) Q4 adj earnings $7.31B vs consensus $6.04B, announces new $3.5B share buyback and guides Q1, Glencore (GLEN.LN) Q4 production update: copper 274.3 kt vs consensus 269.3 kt, guides FY24 production and BT Group (BT.A.LN) Q3 adjusted EBITDA £2.03B vs consensus £2.03B, reconfirms all FY24 financial outlook metrics

    • M&A news flow included Henkel (HEN3.GR) agreeing to acquire the Vidal Sassoon brand and the related hair care business in Greater China from Procter & Gamble (PG) for an undisclosed sum and BAWAG Group (BG.AV) to acquire Knab from ASR Nederland (ASRNL.NA) for consideration of €510M payable at closing. Reportedly, Cellnex Telecom (CLNX.SM) exploring options for its Austrian unit valued at ~ €800M and ACS (ACS.SM) aims to acquire 50% of Thiess from Elliott for €800M this year

    • Sodexo (SW.FP) spin-off Pluxee (PLX.FP) lists on Euronext Paris and DEAG Deutsche Entertainment (LOU.GR) aims to reconsider an IPO later in the year

  • Digest:

    • Sectors - STOXX Europe 600:

      • Outperformers:

        • Autos & Parts +1.38%, Oil & Gas +1.01%, Travel & Leisure +0.65%, Technology +0.28%, Ind Goods & Svcs +0.22%, Media +0.18%, Food & Beverage (0.10%), Persnl & HHold Goods (0.15%), Chemicals (0.25%)

      • Underperformers:

        • Banks (1.97%), Real Estate (1.90%), Financial Svcs (1.49%), Retail (1.30%), Basic Resources (1.21%), Insurance (1.19%), Utilities (0.92%), Health Care (0.60%), Construct & Mtls (0.57%), Telecom (0.40%)

    • Macro/Peripheral markets:

      • Central Banks:

        • Riksbanks says the policy rate can probably be cut sooner than was indicated in Nov - release

        • BOE's MPC voted by a majority of 6-3 to maintain Bank Rate at 5.25%. Two members preferred to increase by 0.25 percentage points, and one member preferred to reduce by 0.25 percentage points - release; Monetary Policy Report

        • ECB's Centeno says inflation is converging to 2% target - Jornal de Negócios

      • EU:

        • European Council reached agreement on the revision of the Multiannual Financial Framework (MFF) 2021-27 enabling financial support for Ukraine - release

        • EU's Breton delivered a keynote speech at the "Friends of Europe in Conversation with Commissioner Breton" event

      • Germany:

        • Companies in the German automotive industry are more positive about their current business situation and are much more optimistic about the coming months - ifo

      • Greece:

        • Parliament to tackle agricultural concerns tomorrow says PM - ekathimerini

      • UK:

        • English councils need £4B to prevent widespread bankruptcy, MPs say - The Guardian

        • Jeremy Hunt: Less scope for tax cuts in Budget - BBC

        • Labour to renationalise train operators with no compensation - The Telegraph; Labour promise not to raise corporation tax if elected - BBC

        • Jan Economic Confidence Index (14) vs prior (28) and stands at highest value since May-23 - Institute of Directors release

        • Opinion polls: Savanta puts the Labour lead at 19 points - X; More in Common puts the Labour lead at 14 points - release

    • Company news:

      • Notable Gainers

        • +26.1% VOLCAR.B.SS (Volvo Car)

          • Q4 EPS SEK1.04 vs FactSet SEK1.51 [5 est, SEK1.32-1.66]; for 2024 expects a higher y/y growth rate in retail sales than in 2023

          • evaluating its Polestar holding

        • +14.3% PROT.NO (Protector Forsikring) -- Q4 net income NOK675.8M vs FactSet NOK379M [3 est, NOK324-429M]; to distribute NOK 5.00/share special dividend

        • +12.5% BONAV.B.SS (Bonava) -- revises financial targets; ROE to be at least 15% over time; signs agreement with lenders to extend credit facilities of ~€400M

        • +10.1% KAP.LN (National Atomic Company Kazatomprom) -- Q4 operations and trading update: 2023 production and sales results were within the guided ranges

        • +7.7% EPRO.B.SS (Electrolux Professional) -- Q4 EPS SEK0.59 vs FactSet SEK0.56 [4 est, SEK0.50-0.61]

        • +7.2% RNK.LN (Rank Group) -- H1 underlying EPS 2.9p vs year-ago (1.2p)

        • +6.7% AXFO.SS (Axfood)

          • Q4 Adjusted operating profit SEK815M vs FactSet SEK788.1M [7 est, SEK721.6-833M]

          • to accelerate the pace of its phase-out of fossil fuels

        • +6.2% INDT.SS (Indutrade) -- Q4 net income SEK710M vs FactSet SEK754.3M [5 est, SEK612.6-1.23B]

        • +5.9% EVO.SS (Evolution) -- Q4 EPS €1.32 vs FactSet €1.32 [10 est, €1.26-1.39], dividend +32.5% y/y

        • +5.9% DETEC.FH (Detection Technology) -- Q4 EPS €0.24 vs FactSet €0.17 [5 est, €0.11-0.23]

        • +5.5% KOF.FP (Kaufman & Broad) -- FY net income €60.2M vs FactSet €59.5M [5 est, €58.4-60.9M]

        • +4.9% NZYM.B.DC (Novozymes) -- Q4 EBIT ex-items DKK1.16B vs consensus DKK1.18B

        • +4.8% CGCBV.FH (Cargotec) -- Q4 EPS €0.92 vs consensus €1.16, constructive 2024 outlook

        • +4.4% ADN1.GR (adesso) -- concludes new framework agreement spanning multiple years with leading mobility provider

        • +4.4% SHL.GR (Siemens Healthineers) -- Q1 EPS €0.49 ex-items vs consensus €0.44, reaffirms FY guidance

        • +4.1% MSLH.LN (Marshalls) -- to buy from hold at Berenberg

        • +3.8% LSL.LN (LSL Property) -- trading update; guides FY revenue from continuing ops £144M vs year-ago £217M

        • +3.6% SVEG.LN (Sparebanken Vest) -- Q4 net income NOK1.00B vs FactSet NOK903.3M [6 est, NOK744-1.02B]

        • +3.5% TNOM.FH (Talenom) -- Q4 EPS €0.02 vs FactSet €0.02 [3 est, €0.02-0.03], raises dividend +5.6% y/y

        • +3.5% AFX.GR (Carl Zeiss Meditec) -- reaches favorable legal settlement with Topcon

        • +3.4% HEXA.B.SS (Hexagon) -- Q4 EPS €0.12 vs FactSet €0.11 [12 est, €0.10-0.12]

        • +3.0% DBK.GR (Deutsche Bank) -- Q4 net income €1.26B vs consensus €833M; plans to increase both buybacks and dividends by at least 50%; updates on Global Hausbank strategy and 2025 targets

          • On earnings/updates: SHEL.LN (Shell), BAG.LN (A.G. BARR), GLEN.LN (Glencore), ABBN.SW (ABB Limited), DSV.DC (DSV), EURN.BB (Euronav), COTN.SW (COMET Holding), SNI.NO (Stolt-Nielsen), AREC.LN (Arecor Therapeutics), OVS.IM (OVS), WAF.GR (Siltronic), DB1.GR (Deutsche Börse), CFT.SW (Cie Financiere Tradition) and reversing initial falls OMV.AV (OMV), SRV1V.FH (SRV)

      • Notable Decliners

        • -35.2% C3RY.GR (Cherry)

          • FY preliminary revenue ~€126M vs prior guidance ~€140M and FactSet €133.5M [5 est, €126-138M], Adjusted Group EBITDA margin ~2% vs prior guidance ~10%

          • downgraded to neutral from outperform at Oddo

        • -16.1% AZT.NO (ArcticZymes Technologies) -- Q4 EBITDA NOK2.0M vs year-ago NOK1.3M, headwinds in the market will continue thereby putting pressure on sales during H1

        • -11.8% GETI.B.SS (Getinge) -- Q4 Adjusted EPS SEK3.11 vs consensus SEK3.23; guides 2024 Net sales to increase by +2-5% organically

        • -10.5% UPM.FH (UPM-Kymmene) -- Q4 comparable EPS €0.46 vs FactSet €0.43 [8 est, €0.37-0.48]; FY24 comparable EBIT expected to increase from 2023

        • -10.1% DSY.FP (Dassault Systemes) -- Q4 non-IFRS EPS €0.36 vs consensus €0.37; guides Q1 and FY24

        • -9.1% TOBII.SS (Tobii)

          • FY EPS (SEK1.87) vs FactSet (SEK1.60) [4 est, (SEK1.78)-(1.17)]

          • announces new financial targets; targets EBIT of around 10% for the full-year 2026

        • -8.8% BNP.FP (BNP Paribas) -- Q4 net income attributable €1.07B unclear if comparable to consensus €1.75B

        • -8.6% ARISE.SS (Arise) -- short-term recommendation downgraded to hold from buy at Handelsbanken

        • -8.4% PRS.NO (Prosafe) -- Q4 EPS ($1.01) vs FactSet ($0.66) [3 est, ($0.79)-(0.57)]

        • -8.0% GEMD.LN (Gem Diamonds) -- Q4 Trading Update: Carats recovered 32,142 vs quarter-ago 26,913

        • -7.7% KINV.B.SS (Kinnevik) -- Q4 NAPS SEK171.02 vs year-ago SEK188.90

        • -7.0% VIT.B.SS (Vitec Software Group) -- Q4 EPS SEK2.13 vs FactSet SEK2.58 [2 est, SEK2.41-2.75]

        • -6.8% TRIN.LN (Trinity Exploration & Production) -- guides FY24 sales 2,600-2,700 bopd

        • -6.6% BYIT.LN (Bytes Technology Group) -- to hold from buy at HSBC

        • -6.4% INGA.NA (ING Groep) -- Q4 net income €1.56B vs consensus €1.50B

        • -6.4% ANX.LN (Anexo Group) -- trading update; provides emissions claims update

        • -6.4% RENEW.SS (Re:NewCell) -- Jan total production 174 metric tons

        • -5.8% PETS.LN (Pets At Home Group) -- downgraded to hold from buy at Berenberg

        • -5.7% RROS.SS (Rottneros) -- Q4 EPS (SEK0.42) vs year-ago SEK0.06

        • -5.6% ROG.SW (Roche Holding)

          • FY Core EPS CHF18.57 vs FactSet CHF18.43 [19 est, CHF17.44-19.94]

          • Genentech Vabysmo New Long-Term Data shows sustained detinal drying and vision improvements in retinal vein occlusion (RVO)

        • -5.5% MTRS.SS (Munters Group) -- confirms previously reported Q4 results posted in advance due to a ransomware attack

        • -5.4% VLTSA.FP (Voltalia)

          • Q4 revenue €170.0M, +20% vs year-ago €142.0M

          • to sell from neutral at Van Lanschot Kempen

        • -5.4% INF.FP (Infotel) -- downgraded to neutral from outperform at Oddo; to neutral from buy at Midcap Partners

        • -5.0% ATRLJ.B.SS (Atrium Ljungberg) -- CFO Ulrika Danielsson resigns, will remain active in the company until late May and early June

        • -5.0% III.LN (3i Group) -- Q3 Trading Update: NAVPS 2,034p as at 31-Dec-23 vs 1,886p as 30-Sep; downgraded to hold from buy at Numis

        • -4.6% SAN.FP (Sanofi)

          • Q4 Business EPS €1.66 vs consensus €1.70, expects 2024 business EPS to remain roughly stable excluding the impact of an expected effective tax rate increase to 21% and decrease low single-digit at CER including the higher expected tax rate

          • appoints prior Nestlé CFO François-Xavier Roger as new CFO effective 1-Apr

        • -4.3% STERV.FH (Stora Enso)

          • Q4 EPS (€0.36) vs consensus (€0.34); FY24 operational EBIT is expected to be higher than for FY23

          • plans program to targeting annualised €80M improvement of the operational EBIT; potential reduction of ~1,000 employees

        • -3.8% BIOA.B.SS (BioArctic) -- to hold from buy at Nordea

        • -3.6% JTC.LN (JTC) -- Group underlying EBITDA for full year will be in line with market expectations

        • -3.2% FER.SM (Ferrovial) -- releases presentation material in connection with its CMD

        • -3.2% SAB.SM (Banco de Sabadell) -- Q4 attributable net profit €304M vs FactSet €283.4M [9 est, €248-325M]

        • -3.1% ACAD.SS (AcadeMedia) -- Q2 Adjusted EBIT SEK204M vs FactSet SEK242.7M [3 est, SEK199-326M]

          • On earnings/updates: GURN.SW (Gurit Holding), MFEB.IM (MFE-MEDIAFOREUROPE), VANQ.LN (Vanquis Banking Group), EPR.NO (Europris), ADS.GR (Adidas), MEDCL.FP (MedinCell) and reversing initial gains BT.A.LN (BT Group), ATS.AV (AT & S Austria Technologie & Systemtechnik), PHNX.LN (Phoenix Group Holdings), AAF.LN (Airtel Africa)

    • EU companies reporting tomorrow:

      • Earnings:

        • Benelux: TomTom (TOM2.NA)

        • DACHs: LEM Holding (LEHN.SW)

        • Nordics: Danske Bank (DANSKE.DC), Matas (MATAS.DC), Industrivarden (INDU.A.SS), Lifco (LIFCO.B.SS), Trelleborg (TREL.B.SS), Husqvarna (HUSQ.B.SS), Electrolux (ELUX.B.SS), Vitrolife (VITR.SS), AFRY (AFRY.SS), Peab (PEAB.B.SS), AddLife (ALIF.B.SS), Addnode Group (ANOD.B.SS), Rejlers (REJL.B.SS), Hansa Biopharma (HNSA.SS), C-RAD (CRAD.B.SS), Duroc (DURC.B.SS), Nelly Group (NELLY.SS), Konecranes (KCR.FH), Consti (CONSTI.FH)

        • Southern Europe: UniCredit (UCG.IM), CaixaBank (CABK.SM)

      • Trading Update: YouGov (YOU.LN)

  • Data:

    • Economics:

      • Jan manufacturing PMI

        • Ireland 49.5 vs consensus 50.3, prior 48.9

        • Netherlands 48.9 vs consensus 45.6, prior 44.8

        • Russia 52.4 vs consensus 54.8, prior 54.6

        • Sweden 47.1 vs consensus 49.5, prior revised 48.6 from 48.8

        • Spain 49.2 vs consensus 48.0, prior 46.2

        • Switzerland 43.1 vs consensus 44.5, prior 43.0

        • Italy 48.5 vs consensus 47.3, prior 45.3

        • France 43.1 vs preliminary 43.2

        • Germany 45.5 vs preliminary 45.4

        • Eurozone 46.6 vs preliminary 46.6

        • Greece 54.7 vs consensus 51.2, prior 51.3

        • Norway 50.7 vs consensus 52.0, prior revised 51.6 from 51.7

        • UK 47.0 vs preliminary 47.3

      • Netherlands Jan preliminary CPI +3.2% y/y vs consensus +1.6%, prior +1.2%

      • Austria Jan preliminary CPI +4.5% y/y vs consensus +4.6%, prior +5.6%

      • Greece Dec unemployment rate 9.2% vs consensus 9.4%, prior 9.4%

      • Eurozone

        • Jan preliminary CPI +2.8% y/y vs consensus +2.8%, prior +2.9%

          • core CPI +3.3% y/y vs consensus +3.2%, prior +3.4%

        • Dec unemployment rate 6.4% vs consensus 6.4%, prior 6.4%

      • Italy Jan preliminary CPI +0.8% y/y vs consensus +1.1%, prior +0.6%

    • Markets:

      • WTI Crude (Mar 24): +$0.84 or +1.11% to $76.69

      • €-$ +0.0043 or +0.40% to 1.0861

      • £-$ +0.0032 or +0.25% to 1.2720

      • €-£ +0.0011 to 0.8538

      • S&P 500 +0.51%

    • Performance year-to-date:

      • FTSE 100: (1.44%)

      • DAX: +0.64%

      • CAC: +0.60%

      • MIB: +1.11%

      • Stoxx 600: +1.02%

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