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StreetAccount Summary - EU Market Recap: FTSE 100 +0.64% to 8235.15, DAX +0.13% to 18496.79, CAC40 +0.55% to 7978.51, STOXX 600 +0.59% to 516.50

May 30 ,2024

  • Synopsis:

    • European equity markets closed higher. Spain +1.8% and Switzerland +0.7% lead outperformers, whilst Greece (0.2%) and The Netherlands slightly lower buck the higher trend and lead underperformers.

    • Market sentiment undermined by rate backup following another softer Treasury auction. Supply concerns have added to hawkish rate repricing. Increased concerns also surrounding Tech sector. While the ECB appears comfortable with a June hike, policy thereafter is uncertain. With European economies recovering focus on inflation outlook and implications for policy. In addition, resurgent oil prices also adding to concerns, though focus for European central banks on core inflation and still-elevated services prices.

    • UK election headlines focus on VAT. Both Conservatives and Labour have pledged not to increase after election. Very little between the two parties on fiscal policy so far. UK election polls continue to vary widely, though Labour well ahead in all surveys and points to big majority.

    • Of note on the data front, Eurozone Sentiment Indicator improved in May to 96.0 versus consensus 96.2 and prior 95.6, while unemployment rate at a weaker-than-expected 6.4%. Spanish inflation accelerated for a third straight month in May, coming in at 3.8% y/y versus expectations of 3.7%. Swiss Q1 GDP firmer-than-expected, while KOF leading indicator missed.

    • Amidst light earnings releases, Telecom Italia (TIT.IM) Q1 domestic revenue and core profit overshadow in-line Q1 results at group level; eDreams ODIGEO (EDR.SM) FY net result turned to profit in 2023 after three years of losses due to pandemic-linked restrictions; reiterated 2025 targets of 7.25M subscribers and foresees "significant growth potential" beyond FY2025; Auto Trader Group (AUTO.LN) reported better-than-expected FY numbers. Helvetia Holding (HELN.SW) reported FY number of active insured persons +8.5% y/y.

    • In M&A, BHP Group (BHP.AU) walks away from talks with Anglo American (AAL.LN). Brookfield (BN.CN) consortium enters into exclusive negotiations to acquire a majority stake in Neoen (NEION.FP) and launch a €39.85/share mandatory tender offer. NZZ to acquire 25% stake in APG SGA (APGN.SW) for CHF220/sh from JCDecaux SE and Pargesa Asset Management.

    • Looking ahead to tomorrow's calendar (see - Europe Week Ahead: 27-May to 31-May attached) Ibersol (IBS.PL), Waste Plastic Upcycling (WPU.NO), De La Rue (DLAR.LN), Biokraft International (BIOGAS.SS) and Nynomic (M7U.GR) will be among other names to update investors, whilst the macro-calendar releases will include Germany Apr retail sales France/Finland/Austria/Belgium/Portugal/Italy Q1 final GDP, France/Italy/Eurozone/Portugal/Netherlands/Austria May preliminary CPI, France Apr PPI, consumer spending, Switzerland Apr retail sales, UK Apr mortgage approvals, M4 money supply, May house price index - Nationwide, Greece Mar retail sales, Austria unemployment rate.

  • Digest:

    • Sectors - STOXX Europe 600:

      • Outperformers:

        • Real Estate +1.92%, Retail +1.70%, Telecom +1.60%, Banks +1.43%, Food, Beverage and Tobacco +1.41%, Travel & Leisure +1.25%, Consumer Products and Services +1.15%, Chemicals +0.99%, Financial Svcs +0.88%, Utilities +0.77%, Personal Care Drug and Grocery Stores +0.70%, Health Care +0.65%,

      • Underperformers:

        • Technology (0.72%), Energy(0.46%), Media +0.02%, Insurance +0.26%, Basic Resources +0.29%, Autos & Parts +0.32%, Ind Goods & Svcs +0.54%,

    • Macro/Peripheral markets:

      • Geopolitics

        • NATO chief calls for discussion on restrictions for arms supplied to Ukraine - Reuters

        • Hungary holds up Rutte as NATO Secretary General - Handelsblatt

        • Russia sources ammunition faster than west, says Prague - FT

      • Russia/Ukraine

        • Tax hikes to give Russia fiscal headroom to further increase spending - Reuters

        • US to offer Ukraine security pact as tensions rise between allies - FT

      • EU

        • EU Agrees to Hike Tariffs on Russian Grain Imports From July - Bloomberg

        • Euro-Zone Economic Confidence Grows as Recovery Strengthens - Bloomberg

      • UK

        • Deal to restore Northern Ireland's executive oversold, says DUP leader - FT

        • UK mortgage holders hardest hit by rising prices, data shows - FT

        • I see no reason why Diane Abbott can't stand for Labour, says Angela Rayner - BBC, The Telegraph

        • Starmer left-wing purge row is not dying down - BBC

        • Hunt puts pressure on Kretinsky to strengthen Royal Mail takeover guarantees - The Telegraph

        • Hunt Says Tax to Rise After UK Vote in Blow to Tory Message - Bloomberg

      • Germany

        • Italy-Germany-Austria agreement on the Hydrogen Corridor -Ansa

        • FDP insists on end of EEG subsidies for new plants - Handelsblatt

      • France

        • France leads initiative on sending military trainers to Ukraine - FT

        • France's Macron to host meeting with U.S. President Biden on June 8 - Reuters

        • To help Airbus, Macron pressed Canada to ease Russia titanium sanctions - Reuters

      • Greece

      • Denmark

        • Denmark Asks Doctors to Move Ozempic Patients to Cheaper Drugs- Bloomberg

    • Company news:

      • Trading Higher:

        • +18.8% YIT.FH (Yit €2.55, +0.40) -- Danske Bank upgrade

        • +14.6% AUTO.LN (Auto Trader Group £8.39, +1.07) -- FY earnings

        • +12.7% BIOVIC.B.SS (Biovica International SEK2.40, +0.27) -- trial results

        • +10.9% BWLPG.NO (BW LPG NOK210.40, +20.70) -- Q1 earnings

        • +9.0% ENQ.LN (EnQuest £0.16, +0.01) -- operations update

        • +8.7% CURY.LN (Currys £0.78, +0.06) -- Berenberg upgrade

        • +4.9% ORY.SM (Oryzon Genomics €2.01, +0.09) -- trial results

        • +4.5% APGN.SW (APG SGA CHF208.00, +9.00) -- NZZ to acquire 25% stake in APG SGA for CHF220/share from JCDecaux SE and Pargesa Asset Management

        • +4.4% 8TRA.GR (TRATON €32.35, +1.35) -- initiated buy at Pareto

        • +4.2% MGN.NO (Magnora NOK33.40, +1.35) -- Helios owners sell all shares to French infrastructure group Vinci for an upfront payment of €73M

        • +3.6% SOP.FP (Sopra Steria Group €221.60, +7.60) -- BNP Paribas Exane upgrade

        • +3.2% PGS.NO (PGS ASA NOK9.31, +0.29) -- final permit for large 4D survey over Barracuda Caratinga fields

        • +2.4% AET.LN (Afentra £0.59, +0.01) -- FY earnings

        • +2.3% SBB.B.SS (Samhällsbyggnadsbolaget i Norden SEK4.96, +0.11) -- agreement with Kåpan Tjänstepension to divide SBB Kåpan Bostad

        • +2.0% SUBC.NO (Subsea 7 NOK193.00, +3.80) -- contract

        • +1.7% RWI.LN (Renewi £6.43, +0.11) -- FY earnings; to sell UK Municipal to Biffa Limited

        • +1.6% EDR.SM (eDreams ODIGEO €6.91, +0.11) -- Q4 earnings

      • Trading Lower:

        • -13.7% OVH.FP (OVHCloud €5.15, -0.82) -- Stifel downgrade

        • -12.7% SALT.LN (MicroSalt £0.88, -0.13) -- FY earnings

        • -12.1% ALNOV.FP (Novacyt €0.68, -0.09) -- FY earnings

        • -9.5% SAS.SS (SAS SEK0.04, -0.00) -- Q2 earnings

        • -9.0% BGBIO.NO (BerGenBio NOK13.00, -1.28) -- to effect reverse share split and change of ISIN today

        • -7.1% PMI.LN (Premier Miton Group £0.73, -0.06) -- H1 earnings

        • -6.9% INTEG.B.SS (Integrum SEK51.60, -3.80) -- Q4 earnings

        • -6.7% ALL.LN (Atlantic Lithium £0.23, -0.02) -- commences field work at Senya Beraku Licence

        • -5.1% ALCOX.FP (Nicox €0.34, -0.02) -- launch of a capital increase with maintenance of preferential subscription rights in the form of ABSA for a maximum amount of ~€3.8M

        • -4.4% PIRC.IM (Pirelli & C. €5.92, -0.27) -- China's Silk Road to sell ~9% stake of Pirelli for ~$553M - Bloomberg

        • -4.3% NKT.DC (NKT A/S DKK592.00, -26.50) -- Carnegie Securities dowgrade

        • -3.1% VRCI.LN (Verici Dx £0.08, -0.00) -- FY earnings

    • EU companies reporting tomorrow:

      • Earnings: Ibersol (IBS.PL), Waste Plastic Upcycling (WPU.NO), De La Rue (DLAR.LN), Biokraft International (BIOGAS.SS)

      • Trading Update: Nynomic (M7U.GR)

  • Data:

    • Economics:

      • Q1 GDP

        • Sweden +0.7% y/y vs preliminary (1.1%)

        • Switzerland +0.6% y/y vs consensus +0.6% and prior revised +0.5% from +0.6%

      • Apr Unemployment Rate

        • Denmark 2.5% vs consensus 2.5% and prior 2.5%

        • Italy 6.9% vs consensus 7.2% and prior 7.2%

        • Eurozone 6.4% vs consensus 6.5% and prior 6.5%

        • Greece 10.8% vs consensus 10.3% and prior revised 10.8% from 10.2%

      • Apr PPI

        • Greece (1.0%) y/y vs consensus +3.1% and prior (0.1%)

        • Italy (5.9%) y/y vs consensus (6.4%) and prior (9.6%)

      • Switzerland

        • Apr Trade Balance CHF4.32B vs consensus CHF3.9B and prior revised CHF3.77B from CHF3.54B

        • May KOF Leading Indicators 100.3 vs consensus 102.3 and prior revised 101.9 from 101.8

      • Spain May Preliminary CPI +3.6% y/y vs consensus +3.7% and prior +3.3%

      • Eurozone May Economic Sentiment Indicator 96.0 vs consensus 96.2 and prior 95.6

    • Markets:

      • WTI Crude (Jul 24): ($0.64) or (0.81%) to $78.59

      • €-$ +0.0041 or +0.38% to 1.0844

      • £-$ +0.0044 or +0.34% to 1.2745

      • €-£ +0.0004 to 0.8509

      • S&P 500 (0.48%)

      • Performance year-to-date

        • FTSE 100: +6.49%

        • DAX: +10.42%

        • CAC: +5.77%

        • MIB: +13.50%

        • Stoxx 600: +7.83%

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