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StreetAccount Summary - EU Market Recap: FTSE 100 (0.55%) to 8370.33, DAX (0.25%) to 18680.20, CAC40 (0.61%) to 8092.11, STOXX 600 (0.34%) to 521.18

May 22 ,2024

• Synopsis:

  • European equity markets finished today's session lower, but off worst levels. Auto/Parts, Basic Resources and Personal/Household leading the underperformers, while Technology, Real Estate and Telecom outperforming. Bond yields firm up after UK inflation update. US 10-year yield 1 bp higher at 4.43%. Bund up 1 bp at 2.52%. Gilt yields 14 bps higher. Dollar mixed; lower versus pound and Kiwi, higher elsewhere. Oil down. Gold softer. Industrial metals lower. US equities little changed in midday trading.

  • Big focus today has been on UK following inflation data, which eased sharply to 2.3% in April, but above BoE forecast and services prices remain sticky. Market pricing out summer BoE rate cut, though policymakers will benefit from another inflation update before it next meets. BoE chief Bailey said late Tuesday it remains on track to sell £100B worth of Gilts by September and reserves likely to settle somewhere between £345-490B. Remarks from ECB's Lagarde and Nagel backed a June rate cut but remained cautious on policy thereafter. Further out of the UK, amidst media reports regarding urgent cabinet meeting, UK PM Rishi Sunak is expected to call a general election on 4-Jul.

  • On the earnings front, out of DACHs region, Ypsomed (YPSN.SW) reported FY numbers and plans to for two independent business areas; Swiss Life Holding (SLHN.SW), Evotec (EVT.GR) also posted Q1 updates and Hornbach Holding (HBH.GR) reported FY results. In Benelux, Cie d'Entreprises CFE (CFEB.BB), Elia Group (ELI.BB) and Heijmans (HEIJM.NA) updated investors with their latest numbers. In the UK, Marks & Spencer Group (MKS.LN), Scottish and Southern Energy (SSE.LN), British Land Co. (BLND.LN), Severn Trent (SVT.LN) and RS Group plc (RS1.LN) are among notable releases for today.

  • In M&A, Anglo American (AAL.LN) rejects further BHP (BHP.LN) proposal and extends PUSU deadline to 29-May-24. Cinven confirms that it does not intend to make an offer for Alpha (AFM.LN). Earlier Galp Energia (GALP.PL) announced agreement to divest its 10% stake in Area 4 Mozambique to ADNOC for net $650M plus contingent payments of $100M and $400M. L Catterton provided update to framework agreement in connection with voluntary tender offer for Tod's (TOD.IM). In Italy, FT reports UniCredit (UCG.IM) supports French President Macron's call for consolidation in Europe's banking sector; CEO says the interest is there under the right conditions.

• Digest:

  • Sectors - STOXX Europe 600:

    • Outperformers:

      • Real Estate +0.79%, Technology +0.58%, Media +0.21%, Telecom +0.19%, Travel & Leisure +0.17%, Personal Care Drug and Grocery Stores +0.03%, Health Care +0.01%, Retail (0.02%), Utilities (0.09%), Construct & Mtls (0.21%)

    • Underperformers:

      • Basic Resources (1.96%), Autos & Parts (1.35%), Consumer Products and Services (1.33%), Oil & Gas(1.22%), Chemicals (0.93%), Banks (0.53%), Insurance (0.47%), Financial Svcs (0.40%), Food, Beverage and Tobacco (0.39%)

  • Macro:

    • ECB:

      • ECB president Lagarde signals potential rate cut in June amid stabilizing inflation: Bloomberg

      • ECB's Nagel urges caution on rate cuts despite positive wage trends: Bloomberg

    • UK:

      • Rumours swirl amid possible general election announcement -- BBC

      • UK PM Rishi Sunak calls Cabinet to urgent meeting amidst warnings he 'could trigger a General Election tonight -- Daily Mail

      • UK inflation declines less than expected, fueling doubts over BoE rate cut timing (Bloomberg)

      • UK employers grant nearly 5% pay increases amid persistent inflation pressures (Reuters)

    • Germany:

      • German AfD candidate steps aside after SS comments as EU's far right splits - Reuters

    • Geopolitics:

      • EU adopts plan to utilize frozen Russian assets for Ukraine's defence, faces Russian condemnation: Reuters

      • Germany accepts EU tariffs on China EVs despite concerns of retaliation: Politico

      • German politician urges France to accelerate weapon deliveries to Ukraine amid Russian aggression (Politico)

  • Peripheral markets:

    • Netherlands:

      • Dutch election winner Wilders expects government installed by end-June - Reuters

    • Spain:

      • Spain weighs running out clock on naming new central bank head - Bloomberg

    • Greece:

      • Business turnover at a five-year high - Kathimerini

    • Poland:

      • Poland to consider gradual easing only in 2025, policymaker says - Bloomberg

  • Company news:

    • Notable Gainers

      • +28.0% PREC.SS (Precise Biometrics SEK2.10, +0.46) -- AI-driven product launch

      • +14.8% YPSN.SW (Ypsomed Holding CHF388.00, +50.00) -- FY net income CHF78.4M vs FactSet CHF86.7M [4 est, CHF74-118.5M]; plans to have two independent business areas

      • +14.7% OSE.FP (OSE Immunotherapeutics €8.26, +1.07) -- expands collaboration with Boehringer Ingelhei (+BOEHRINGER)

      • +14.2% STAF.LN (Staffline Group £0.34, +0.04) -- remains confident that the group is on track to deliver FY results in line with management expectations -- AGM Update

      • +11.1% IHP.LN (Integrafin Holdings £3.44, +0.35) -- H1 IFRS EPS 7.4p vs FactSet 7.0p [3 est, 6.7-7.4p]

      • +10.0% MAB.LN (Mitchells & Butlers £2.93, +0.27) -- H1 EPS 13.6p ex-items vs FactSet 10.7p [1 est]

      • +9.0% MRL.LN (Marlowe £5.82, +0.48) -- trading update: trading in line with market expectations, to return up to an increased £225M of proceeds by way of special dividend and a share buy-back program

      • +8.8% COTN.SW (COMET Holding CHF340.00, +27.50) -- upgraded to outperform at Zürcher Kantonalbank

      • +8.0% HEIJM.NA (Heijmans €20.45, +1.50) -- sets financial targets for 2027 in presentation

      • +6.6% ODL.NO (Odfjell Drilling NOK53.40, +3.30) -- contract extension

      • +5.3% BOUV.NO (Bouvet NOK65.90, +3.30) -- earnings

      • +5.2% MKS.LN (Marks & Spencer Group £2.86, +0.14) -- FY EPS 24.6p ex-items vs consensus 23.1p

      • +3.8% IDOX.LN (IDOX £0.66, +0.02) -- H1 Trading Update: revenue £43M, +20% y/y

      • +2.1% BLND.LN (British Land Co. £4.00, +0.08) -- FY EPRA NTAPS 562.0p vs year-ago 588.0p; Comfortable with market expectations for FY25 Underlying EPS of 27.9p vs FactSet 27.3p

      • +1.7% CAI.AV (CA Immobilien Anlagen €29.52, +0.50) -- Q1 FFO 1 €26.7M vs year-ago €23.9M

      • +1.5% COA.LN (Coats Group £0.88, +0.01) -- trading statement: guides FY adjusted EBIT margin at least in line with 17% goal

      • +1.4% ATO.FP (ATOS SE €2.11, +0.03) -- Kretinsky reportedly exploring potential changes to bid for Atos in order to win over company's creditors -- Reuters (earlier)

      • +1.3% SON.PL (Sonae SGPS €0.94, +0.01) -- Q1 net income attributable €25M vs FactSet €10.5M [1 est] (post EU close 21-May)

      • +1.0% TRYG.DC (Tryg DKK145.50, +1.50) -- pgraded to outperform from underperform at Keefe, Bruyette & Woods

      • +1.0% SSE.LN (Scottish and Southern Energy £18.11, +0.18) -- FY EPS 158.5p vs FactSet 156.5p [15 est, 153.0-168.5p]

    • Notable Decliners

      • -15.4% BETCO.SS (Better Collective SEK253.00, -46.00) -- Q1 EPS €0.12 vs FactSet €0.19 [2 est, €0.18-0.20]

      • -13.0% SEQUA.BB (Sequana Medical €1.52, -0.23) -- FDA meeting update

      • -12.4% NANO.FP (Nanobiotix €5.71, -0.81) -- provides Q1 operational and financial update; reports cash and cash equivalents of €58.9M as of 31-Mar-24

      • -9.9% GOGL.NO (Golden Ocean Group NOK150.50, -16.50) -- Q1 adj net income $58.4M vs FactSet $55.6M

      • -9.3% TRAD.SS (Tradedoubler SEK4.48, -0.46) -- earnings

      • -8.0% IVA.FP (Inventiva €3.28, -0.29) -- Q1 revenue €0.0M vs FactSet €1.4M [1 est]

      • -7.3% V6C.GR (Viscom €5.38, -0.42) -- earnings

      • -6.7% CBG.LN (Close Brothers Group £4.59, -0.33) -- Q3 Trading Update

      • -4.9% MARI.AV (Marinomed Biotech €15.50, -0.80) -- earnings

      • -4.4% C3RY.GR (Cherry €2.51, -0.12) -- confirms prelim Q1 revenue of €30.3M and FY24 outlook as per 26-Apr update

      • -3.7% AALB.NA (Aalberts €46.40, -1.76) -- 4M trading update: (2.6%) organic revenue growth y/y

      • -3.7% AALB.NA (Aalberts €46.40, -1.76) -- trading update

      • -3.0% MAB1.LN (Mortgage Advice Bureau £9.00, -0.28) -- AGM Statement: performance is in line with board's expectations, with further improvement expected in H2 of this yea

      • -2.6% SBO.NO (Selvaag Bolig NOK38.90, -1.05) -- earnings

      • -2.4% FOUR.LN (4imprint Group £59.80, -1.50) -- AGM trading update; CFO to retire

      • -2.4% CLCO.NO (Cool Co. NOK128.60, -3.20) -- Q1 net income $36.8M vs FactSet $26.7M [6 est, $22-30M]

      • -2.0% SLHN.SW (Swiss Life Holding CHF616.40, -12.80) -- Q1 Gross Written Premiums & fees CHF7.52B vs consensus CHF7.70B

      • -1.9% HBH.GR (Hornbach Holding €76.70, -1.50) -- reports FY EPS €7.83 vs FactSet €8.33 [4 est, €7.48-9.56]

      • -1.8% RKH.LN (Rockhopper Exploration £0.14, -0.00) -- FY net income ($4.6M) vs year-ago $35.5M

      • -1.8% MEGP.LN (ME Group International £1.65, -0.03) -- sells SEMPA SAS to Food Machine Invest for €4.6M

      • -1.5% UCG.IM (UniCredit €35.99, -0.55) -- supports French President Macron's call for consolidation in Europe's banking sector; says the interest is there under the right conditions - FT, citing CEO

      • -1.2% ELI.BB (Elia Group €100.00, -1.20) -- issues Q1 interim declaration; reaffirms FY net income attributable €335-385M vs FactSet €362.8M [5 est, €340-373.0M]

  • EU companies reporting tomorrow:

    • Earnings:

      • Benelux: Gimv (GIMB.BB)

      • DACHs: CTS Eventim (EVD.GR), 2G Energy (2GB.GR), DATAGROUP (D6H.GR), USU Software (OSP2.GR), Nabaltec (NTG.GR), NFON (NFN.GR), DFV Deutsche Familienversicherung (DFV.GR), Schoeller-Bleckmann Oilfield Equipment (SBO.AV), PORR (POS.AV)

      • France: Compagnie des Alpes (CDA.FP)

      • Nordics: Embracer Group (EMBRAC.B.SS), Panoro Energy (PEN.NO), Måsøval (MAS.NO), Elliptic Laboratories (ELABS.NO), Awilco LNG (ALNG.NO), NRC Group (NRC.NO), Fynske Bank (FYNBK.DC)

      • Southern Europe: Public Power Corp. (PPC.GA), Grenergy Renovables (GRE.SM)

      • UK: AJ Bell (AJB.LN), Bloomsbury Publishing (BMY.LN), Great Portland Estates (GPE.LN), Helical (HLCL.LN), International Distributions Services (IDS.LN), Investec (INVP.LN), Ithaca Energy (ITH.LN), Johnson Matthey (JMAT.LN), National Grid (NG.LN), QinetiQ Group (QQ.LN), Tate & Lyle (TATE.LN), Wizz Air Holdings (WIZZ.LN)

    • Trading Update: Aviva (AV.LN), Petershill Partners (PHLL.LN), Hill & Smith (HILS.LN), Essentra (ESNT.LN), Headlam Group (HEAD.LN), Julius Baer (BAER.SW), Acciona (ANA.SM), Ackermans & van Haaren (ACKB.BB), Ion Beam Applications (IBAB.BB)

• Data:

  • Economics:

    • UK Apr

      • CPI +2.3% y/y vs cons +2.1% and prior +3.2%; +0.3% m/m vs cons +0.2% and prior +0.6%

        • Core +3.9% y/y vs cons +3.6% and prior +4.2%

      • RPI +3.3% y/y vs cons +3.3% and prior +4.3%; +0.5% m/m vs cons +0.5% and prior +0.5%

      • Output PPI +1.1% y/y vs cons +1.2% and prior revised +0.7% from +0.6%; +0.2% m/m vs cons +0.4% and prior +0.2%

      • Input PPI (1.6%) y/y vs cons (1.2%) and prior (2.5%); +0.6% m/m vs cons +0.4% and prior revised (0.2%) from (0.1%)

    • Finland Apr Unemployment Rate 9.2% vs cons 8.5% and prior 9.0%

    • Sweden Apr Unemployment Rate 8.9% vs cons 9.0% and prior 9.2%

  • Markets:

    • WTI Crude (Jul 24): ($0.63) or (0.80%) to $78.03

    • €-$ (0.0012) or (0.11%) to 1.0843

    • £-$ +0.0023 or +0.18% to 1.2734

    • €-£ (0.0023) to 0.8516

    • S&P 500 (0.05%)

    • Performance year-to-date

      • FTSE 100: +8.24%

      • DAX: +11.51%

      • CAC: +7.28%

      • MIB: +13.54%

      • Stoxx 600: +8.81%