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StreetAccount Summary - EU Market Recap: FTSE 100 (0.20%) to 8228.48, DAX (0.34%) to 18494.89, CAC40 (1.35%) to 7893.98, STOXX 600 (0.27%) to 522.16

Jun 10 ,2024

  • Synopsis:

    • European equity markets finished lower, but off worst levels. France's CAC the standout underperformer. Consumer products & services, banks, construction and food/beverage the biggest decliners; miners and energy best performers. Bund up 4 bps at 2.66%, French OATs 8 bps higher and BTPs up 9 bps. US Dollar up across the board. Gold slightly lower. Bitcoin futures down. WTI crude up. Industrial metals higher.

    • The results and implications of European Parliament elections were the spotlight throughout the day. Vote across region saw shift to the right. French President Macron surprised by calling a snap election after Le Pen's National Rally party won 31.5% of the vote. In Germany, Scholz's Social Democrats suffered at the expense of CDU/CSU and far-right AfD, while Italy's Meloni had a good election. European Commission President von der Leyen has a narrow path to a second term after her European People's Party won 189 seats.

    • In macroeconomic releases, Eurozone Sentix Economic Index jumps in June with much stronger than expected outturn. UK survey data showed job market is recovering, which fits in with other forward-looking surveys. Norwegian headline CPI missed expectations, but core fell less than forecast. ECB speakers point to cautious approach on rates, with September next likely "live" meeting for rate cuts. In the UK election, parties will release manifestos this week. Fiscal rules of main parties continued to face criticism over lack of credibility.

    • Light on the corporate front. The surprise snap French election called by President Macron following poor European election results has injected significant political uncertainty into markets. French bank stocks like Societe Generale (GLE.FP), BNP Paribas (BNP.FP), Crédit Agricole S.A. (ACA.FP) down over 4%. French construction firms and broader European banking sector also sold off sharply. Analysts recommend reducing exposure to French equities, banks, autos, property and other risk assets given the heightened instability. A National Rally win could derail economic reforms, worsen public finances, and strain EU relations, though their populist platform itself remains unclear.

    • Amidst subdued earnings/updates, Kemira (KEMIRA.FH) upgraded outlook for 2024. Sulzer (SUN.SW) updated on its «Sulzer 2028» strategy in connection with today's CMD. In M&A, Deutsche Telekom (DTE.GR) is acquiring roughly 6.7M additional shares in T Mobile US (TMUS) from Softbank (9984.JP) by exercising options at fixed price of $99.51/sh. S.G.G. Holding S.p.A. raised offer for SAES Getters (SG.IM) to €28.0/sh, best and final offer. DFDS (DFDS.DC) agreed to divest the Oslo-Frederikshavn-Copenhagen cruise ferry route to Gotlandsbolaget for ~ DKK400M. Media reports suggest Botswana in talks to raise its 15% stake in De Beers (AAL.LN).

  • Digest:

    • Sectors - STOXX Europe 600:

      • Outperformers:

        • Oil & Gas+0.85%, Basic Resources +0.76%, Real Estate +0.28%, Autos & Parts +0.28%, Health Care +0.00%, Financial Svcs (0.04%), Technology (0.04%), Personal Care Drug and Grocery Stores (0.20%), Retail (0.23%), Travel & Leisure (0.23%)

      • Underperformers:

        • Consumer Products and Services (1.23%), Food, Beverage and Tobacco (1.19%), Construct & Mtls (0.95%), Banks (0.93%), Insurance (0.83%), Chemicals (0.40%), Media (0.37%), Utilities (0.36%), Telecom (0.32%)

    • Macro:

      • EU elections:

        • European Parliament 2024 - 2029 provisional results Live results

      • Central Banks:

      • ECB's Kazimir sees no need to rush into another rate cut, with September to be a pivotal - wires

      • ECB's Holzmann warns further rate cuts could risk euro weakness, higher inflation (Bloomberg)

      • Traders bet ECB will have limited room to cut rates this year with inflation above target (FT)

    • Politics:

      • Surge in far-right populism drives French President Macron to call snap Parliamentary Elections (Politico)

      • AfD surges in EU elections amid scandals, reshaping German politics (Reuters)

      • Brussels blames Russian disinformation for expected populist gains in EU elections (London Times)

    • UK:

      • Survey shows UK jobs market recovering: Reuters

      • UK growth since 2020 largely drive by immigration: Guardian

      • UK think tank predicts tax increases after election: Resolution Foundation

      • Labour party manifesto to include triple tax lock after Tory claim of £2,000 rise (London Times)

  • Peripheral markets:

    • Italy:

      • Italy PM Meloni's right-wing victory boosts political standing in EU and Italy (Reuters, Bloomberg)

    • Spain:

      • Spain's centrists stem far-right surge in EU vote, bolstering Sanchez status (Reuters)

    • Belgium:

      • Right-wing New Flemish Alliance emerged as the biggest winner of general election in Belgium on Sunday; De Croo quits as PM - euronews; Politico

    • Ireland:

      • Fine Gael and Fianna Fáil will remain the dominant parties in local government - RTE

    • Norway:

      • Emphasized the need to strengthen the international regulations in order to give far more workers the right to a safe working day and social rights - presentation at The International Labor Conf

  • Company news:

    • Notable Gainers

      • +13.3% AGY.LN (Allergy Therapeutics £0.06, +0.01) -- progression through patient cohorts in Phase I/IIa VLP Peanut PROTECT Trial

      • +9.6% STAF.LN (Staffline Group £0.39, +0.03) -- launches £2.5M share buyback program

      • +7.7% KEMIRA.FH (Kemira €24.04, +1.72) -- raises 2024 outlook

      • +6.1% METN.SW (Metall Zug CHF1,390.00, +80.00) -- completes closing of JV between Metall Zug, Miele

      • +5.5% MINEST.SS (Minesto SEK4.00, +0.21) -- Minesto and Sev renew and update Power Purchase Agreement

      • +5.0% SANN1.SW (Santhera Pharmaceuticals Holding CHF10.10, +0.48) -- launch of early access program in China for AGAMREE by its partner Sperogenix

      • +3.0% WSTEP.NO (Webstep $23.70, +0.70) -- CFO steps down

      • +1.9% GMS.LN (Gulf Marine Services £0.19, -0.00) -- second phase of 4-year contract for vessel in the Middle East

      • +1.9% MOR.GR (Morphosys €68.20, +1.30)

      • +1.8% SAS.SS (SAS SEK0.03, -0.00) -- May traffic

      • +1.7% SG.IM (SAES Getters €27.70, +0.45) -- S.G.G. Holding S.p.A. raises offer to €28.0/sh

      • +1.4% ALBPS.FP (Biophytis €0.68, +0.01) -- Investigational New Drug (IND) application regarding phase 2 OBA clinical study in obesity with BIO101 (20-hydroxyecdysone) submitted with FDA

      • +1.2% TSTL.LN (Tristel £4.35, +0.05) -- appoints Matthew Sassone as CEO, effective 2-Sep

      • +1.0% SUN.SW (Sulzer CHF123.20, +1.20) -- updates on «Sulzer 2028» strategy in connection with today's CMD

      • +0.5% NORAM.NO (NorAm Drilling NOK39.35, +0.20) -- May Drilling Update

      • +0.5% DFDS.DC (DFDS DKK213.80, +1.00) -- to divest the Oslo-Frederikshavn-Copenhagen cruise ferry route to Gotlandsbolaget for ~ DKK400M

      • +0.4% AZN.LN (AstraZeneca £126.00, +0.44) -- Tagrisso granted Priority Review in the US for patients with unresectable, Stage III EGFR-mutated lung cancer

    • Notable Decliners

      • -4.8% MEGP.LN (ME Group International £1.62, -0.08) -- H1 trading update

      • -1.6% NEL.NO (NEL ASA NOK7.13, -0.12) -- distribution of shares in Cavendish Hydrogen ASA

      • -1.5% MEDCL.FP (MedinCell €14.90, -0.22) -- FY earnings

  • EU companies reporting tomorrow:

    • Earnings: Colruyt Group (COLR.BB), Heidelberger Druckmaschinen (HDD.GR), MPH Health Care (93M1.GR), Cake Box Holdings (CBOX.LN), Eckoh (ECK.LN), FirstGroup (FGP.LN), Idox (IDOX.LN), iomart Group (IOM.LN), Oxford Instruments (OXIG.LN), Oxford Metrics (OMG.LN)

    • Trading Update: Bellway (BWY.LN), Groupe Partouche (PARP.FP)

    • CMD/events: VNV Global (VNV.SS), Polymetal International (POLY.LN), Afentra (AET.LN), Innate Pharma (IPH.FP)

Data:

  • Economics:

    • Eurozone Jun Sentix Economic Index 0.3 vs cons (1.5) and prior (3.6)

    • Italy Apr Industrial Production (2.9%) y/y vs cons (3.1%) and prior revised to (3.2%) from (3.5%); Industrial Production (1%) m/m vs cons +0.3% and prior (0.5%)

    • Switzerland May Consumer Sentiment (38.0) vs cons (37) and prior (38.1)

    • Sweden Apr Industrial Production (4.4%) y/y vs cons (2.3%) and prior +2.9%; (2.4%) m/m vs cons (0.6%) and prior +2.1%

    • Norway May

      • CPI +3% y/y vs cons +3.4% and prior +3.6%; (0.1%) m/m vs cons +0.1% and prior +0.8%

      • May PPI +3.2% y/y vs cons +3.7% and prior (4.5%)

    • Denmark

      • Apr Trade Balance DKK23.1B vs cons DKK20.3B and prior revised DKK19.8B from DKK15.9B

      • May CPI +2.2% y/y vs cons +2.2% and prior +0.8%; 0.0% m/m vs cons +0.2% and prior +0.1%

    • Greece

      • Apr Industrial Production +10.8% y/y vs cons (3.7%) and prior (0.6%)

      • May CPI +2.4% y/y vs cons +3.1% and prior +3.1%; EU Harmonised: May CPI +2.4% y/y vs cons +3.3% and prior +3.2%

    • Netherlands Apr Manufacturing Production +0.4% m/m vs cons +1.5% and prior revised (1.3%) from (1.5%)

  • Markets:

    • WTI Crude (Jul 24): +$1.51 or +2.00% to $77.04

    • €-$ (0.0026) or (0.24%) to 1.0744

    • £-$ +0.0003 or +0.02% to 1.2727

    • €-£ (0.0023) to 0.8444

    • S&P 500 +0.06%

    • Performance year-to-date

      • FTSE 100: +6.40%

      • DAX: +10.41%

      • CAC: +4.65%

      • MIB: +13.81%

      • Stoxx 600: +9.01%

This information and data is provided for general informational purposes only. The Bank of New York Mellon and our information suppliers do not warrant or guarantee the accuracy, timeliness or completeness of this information or data. We provide no advice nor recommendation or endorsement with respect to any company or securities. We do not undertake any obligation to update or amend this information or data. Nothing herein shall be deemed to constitute an offer to sell or a solicitation of an offer to buy securities.
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