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StreetAccount Summary - Europe Pre-Open: Futures: FTSE (0.10%), DAX30 (0.05%), CAC40 (0.53%)

Mar 20 ,2024

  • Synopsis

    • European equity markets indicate a lower open amidst mostly higher trading in Asia at this time and higher close on Wall Street overnight. US equity futures a bit weaker with S&P off 0.1%. Bonds steady. Dollar firmer against yen, little changed elsewhere. Oil down. Gold a bit firmer. Industrial metals mostly higher.

    • On the agenda for today, EU's von der Leyen and UN's Guterres participate in the Tripartite Social Summit. In UK, weekly PMQs at 12:00 GMT. In central banks, Conf. 'The ECB and Its Watchers' organised by IMFS, speakers include ECB's Lagarde ay 9:45CET and Lane panellist at 10:30, with Bank Of Spain's de Cos panellist at 13:00 and ECB's Schnabel panellist at 14:45. Bank of Spain's Gavilán panellist at 9:30 at Anuario del €2024. BOE's Cleland panellist at 10:55GMT at Pay360 conf. Riksbank's Bunge speech at 13:00CET a seminar organised by Kontantupproret. Bank of Austria's Holzmann speech at 16:30CET at event on energy transition. Bundesbank's Balz speech at 16:30CET at WFEClear and Nagel panellist at 17:45CET at event organised by ASKO Europa-Stiftung.

    • Macro releases scheduled for today include UK Feb CPI/RPI/PPI input/output, Germany Feb PPI, Italy Jan industrial production, Eurozone Mar flash consumer confidence along with Jan construction output. UK CPI forecast to show further progress in disinflation process. Weaker reading might reinforce BoE rate cut expectations.

    • Of note in corporate updates, Kering (KER.FP) issued a profit warning after the market close yesterday; group estimates current trends lead to an estimated drop in consolidated revenue of ~ (10%) on a comparable basis in Q1 of 2024 compared to last year. Group notes this performance mainly reflects a more marked decline in Gucci, particularly in Asia-Pacific. Thus, Gucci's turnover as of 31-Mar should be down by almost (20%) on a comparable basis. On balance, a negative read-across for the sector is expected given the comments on Asia-Pacific (and fears of general weakness in the US and deteriorating European consumer). In the UK, Prudential (PRU.LN) reports FY adjusted operating profit at $2.89B vs consensus $2.88B; adds sales growth has continued in the first two months of 2024 and group is confident in achieving 2027 financial and strategic objectives. In France, Bureau Veritas (BVI.FP) hosts its CMD during which the group will present its 2028 strategy and financial ambitions and also announces €200M buyback for FY24. Out of DACHs, Lonza (LONN.SW) announces an agreement to acquire large-scale biologics site in Vacaville (US) from Roche (ROG.SW) for $1.2B in cash; as the transaction is expected to be accretive to sales growth, Lonza has updated its Mid-Term guidance 2024 - 2028 and sales growth range has now been updated to 12 - 15% from prior 11 - 13% CAGR in CER.

  • Politics/ Macro/ World News:

    • Tories narrowly back Sunak to lead party into next election - The Telegraph

    • EU reaches interim deal to extend tariff-free Ukrainian agricultural imports - Reuters

    • Swiss Rate-Cut Curve Ball Can't Be Ignored as Banks Turn Against the Franc - Bloomberg

  • Top company news

    • Earnings/updates

      • KER.FP (Kering) -- estimates Q1 consolidated revenue should decline by (~10%) y/y on a comparable basis

      • PRU.LN (Prudential) -- FY IFRS profit after tax $1.71B vs FactSet $2.35B [14 est, $1.03-3.81B]

      • TRN.IM (TERNA Rete Elettrica Nazionale) -- FY net income €885.4M vs FactSet €874.6M [15 est, €854.8-892M]

      • DWNI.GR (Deutsche Wohnen) -- FY FFO of cont ops €1.31 vs FactSet €1.26

      • PCZ.GR (ProCredit Holding) -- FY net income €113.4M vs year-ago €16.5M

      • VLA.FP (Valneva) -- FY net income (€101.4M) vs year-ago (€143.3M); reiterates FY24 guidance and provides mid-term outlook

      • BVI.FP (Bureau Veritas) -- issues 2028 strategy and financial ambitions; announces €200M buyback for FY24

      • TIMA.GR (ZEAL Network) -- FY adjusted EBITDA €32.9M vs FactSet €33.2M [4 est, €32.3-34M]; raises basic dividend +10% y/y, guides 2024

      • COPN.SW (Cosmo Pharmaceuticals) -- prelim FY core business revenue €96.7M vs year-ago €102.1M; raises dividend +90.5% y/y; provides 2024, 2025 guidance

      • SKIS.B.SS (SkiStar) -- Q2 EPS SEK10.43 vs FactSet SEK9.93 [3 est, SEK9.80-10.00]

      • VIRP.FP (Virbac) -- FY net income €121.1M vs FactSet €124.4M [8 est, €117.8-141M]

      • PST.IM (Poste Italiane) -- publishes 2024-28 Strategic Plan; confirms 2023 preliminary earnings

      • DEQ.GR (Deutsche EuroShop) -- FY FFO €2.28 vs year-ago €2.11

      • EUZ.GR (Eckert & Ziegler Strahlen- und Medizintechnik) -- board proposes a reduced dividend of € 0.05/sh; Q4 net income €26.3M vs guidance €25M and FactSet €24.2M [1 est]

      • PIG.FP (Haulotte Group) -- FY net income (€1M) vs FactSet €7.1M [4 est, €3.4-10.4M]

      • BEN.FP (Beneteau) -- FY net income €182M vs FactSet €156.9M [5 est, €150-167.4M]

    • M&A

      • LONN.SW (Lonza Group) -- to acquire large-scale biologics site in Vacaville (US) from Roche (ROG.SW) for $1.2B in cash; updates mid-term guidance

      • AIR.FP (Airbus) -- Boeing (BA) looking at how to cut Spirit's exposure to Airbus - Reuters

      • IMCD.NA (IMCD) -- agrees to acquire Bretano for an undisclosed sum

      • RLIA.SM (Realia Business) -- FCyC,S.A. and Finver Inversiones acquire stake in Realia Business from the Polygon Group for €1.10/sh

      • LO24.GR (Lotto24) -- ZEAL Network reaches 95% stake in Lotto24 AG; announces squeeze-out

      • LEHTO.FH (Lehto Group) -- sells its ownership in Insinööritoimisto Mäkeläinen Oy

      • EU clears Deutsche Post International (DPW.GR) and Poste Italiane (PST.IM) parcel locker JV in Italy

    • Healthcare

      • IDIA.SW (Idorsia) -- once-daily TRYVIO (aprocitentan) approved by US FDA for the treatment of high blood pressure not adequately controlled in combination with other antihypertensives

      • NYXH.BB (Nyxoah) -- announces DREAM U.S. pivotal study meets primary endpoints

      • +BOEHRINGER (Boehringer Ingelheim) -- gets FDA approval for sNDA for SPEVIGO to treat GPP in pediatric patients

      • XBRANE.SS (Xbrane Biopharma) -- Xbrane resolves on directed issue of shares to guarantors in connection with completed rights issue

    • Other

      • ABI.BB (Anheuser-Busch InBev) -- announces closing of buyback and secondary global offering by Altria

      • STLAM.IM (Stellantis) -- to contribute additional $10M for installation of public EV chargers

      • MONC.IM (Moncler) -- holder Grinta (Rivetti family) place 3.23M shares at €67/sh through JPMorgan (post EU close 19-Mar)

      • TIT.IM (Telecom Italia) -- minority investor Merlyn Partners considering putting forward alternative slate of board candidates - Bloomberg

      • ML.FP (Cie Generale des Etablissements Michelin SA) -- Michelin publishes global tire market data for February

      • HLN.LN (Haleon) -- SEC filing: SC 13D/A (Filed by PFIZER INC)

      • IBE.SM (Iberdrola) -- approves share buy-back programme

      • WLN.FP (Worldline) -- Crédit Agricole (ACA.FP) and Worldline announce the launch of JV

      • MOWI.NO (Mowi) -- publishes 2023 Integrated Annual Report, including sustainability reporting

      • NEX.FP (Nexans) -- secures first call-off under TenneT framework agreement

      • SEB.A.SS (Skandinaviska Enskilda Banken) -- initiates a new SEK 2B buyback program of Class A shares

      • ETL.FP (Eutelsat Communications) -- Eutelsat Communications, Intelsat sign multi-year partnership valued at up to $500M

      • MMB.FP (Lagardere) -- Lagardère announces Pierre Leroy steps down as deputy CEO

      • ECV.GR (Encavis AG) -- ENCAVIS collaborates with BELECTRIC to build large-scale and high-performance solar farm in Borrentin with capacity of 114 MW and annual power generation of 119 GWh

      • SAS.SS (SAS) -- receives court approval of chapter 11 plan

      • General Dynamics, BAE Systems, Leonardo DRS, Honeywell Aerospace, RTX Corporation and Lockheed Martin named principal contractors for $2.2B M1A2 tank sale to Bahrain

      • RIO.LN (Rio Tinto) -- commits to enhance disclosure on plans to reduce scope 3 emissions from processing iron ore (19-Mar)

  • Key rating changes

    • Upgrades

      • AENA.SM (Aena S.M.E.) -- to hold from sell at Bestinver Securities

      • BAS.GR (BASF SE) -- to buy from hold at Berenberg

      • ELM.LN (Elementis) -- to buy from hold at HSBC

      • RDC.GR (Redcare Pharmacy) -- to hold from reduce at HSBC

      • ROCK.B.DC (Rockwool) -- to buy from hold at DnB Markets

      • TRN.IM (TERNA Rete Elettrica Nazionale) -- to neutral from sell at Goldman Sachs

    • Downgrades

      • AGR.LN (Assura) -- to add from buy at Peel Hunt

      • ECV.GR (Encavis AG) -- to hold from buy at HSBC

      • ENI.IM (Eni) -- to hold from buy at Berenberg

      • FCC.SM (Fomento de Construcciones y Contratas) -- to hold from buy at Societe Generale

      • KARN.SW (Kardex Holding) -- to hold from buy at Berenberg

      • SRS.IM (Saras) -- to equal weight from overweight at Barclays

    • Initiations

      • ALESK.FP (Esker) -- buy at Societe Generale (19-Mar, timing uncertain)

      • CDON.SS (CDON AB) -- buy at Jefferies

      • CWK.LN (Cranswick) -- buy at Redburn Atlantic

      • RAA.GR (Rational) -- hold at Stifel

  • Data

    • Nikkei closed

    • Hang Seng +0.31% to 16580.14

    • Shanghai Composite +0.46% to 3076.76

    • S&P futures (5.5) vs prior close of 5241.8

    • €-$ +0.0005 or +0.05% to 1.0872

    • $-¥ +0.62 or +0.41% to 151.49

    • €-¥ +0.73 or +0.45% to 164.65

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