Jul 15 ,2024
Synopsis
European equity markets set to open lower after last week's gains when the STOXX Europe 600 closed up +1.45%
Asian equities mixed Monday. Hang Seng underperforming as property developers extend losses following weak China housing data. China Q2 GDP growth fell by more than expected with consumption and property market main drags. June retail sales, industrial production and fixed asset investment growth all slowed. Housing metrics subdued with real estate investment, new home prices, construction starts and home sales all falling at steep pace. Separately, PBOC left MLF rate unchanged as expected while rolling over maturing funds.
Weekend press dominated by assassination attempt on Donald Trump. Trump survived after bullet grazed his ear before shooter was neutralized by Secret Service. Shooting generated lot of discussion about political fallout with Trump's election odds shortening further and coinciding with increased probability of GOP sweep, which is seen putting more traction behind 'Trump trade' (steeper yield curve, stronger dollar).
The week ahead in Europe sees ECB interest rate decision, EU parliament resumes following elections, King's Speech, UK host meeting of leaders from close to 50 European countries, Germany Jul ZEW survey, UK Jun inflation data as well as earnings/updates from the likes of ASML Holding (ASML.NA), Atlas Copco (ATCO.A.SS), Burberry Group (BRBY.LN), Nokia (NOKIA.FH), Novartis (NOVN.SW) and Richemont (CFR.SW)
Today, earnings/updates eyed from Swatch Group (UHR.SW) reports weak H1 results on China trends; reports H1 net income CHF147M vs consensus CHF365.2M; c.FX growth (10.7%) vs consensus (5.0%); expects the situation to improve strongly in H2.TomTom (TOM2.NA) reports Q2 net income (€2.3M) vs consensus (€4M); now guides FY FCF (excl. restructuring) as % of Group revenue 1-5% vs prior guidance > 5%. Gjensidige Forsikring (GJF.NO) reports Q2 net income NOK1.39B vs consensus NOK1.55B. Drägerwerk (DRW3.GR) reports preliminary Q2 EBIT €41M vs FactSet €21.7M. Mowi (MOWI.NO) reports Q2 operational EBIT €230M vs FactSet €261.2
Macro data releases include Germany May retail sales, Switzerland Jun PPI, Eurozone May industrial production, Finland Jun CPI
In central banks, Bank of Portugal releases its latest Official Bulletin. There's a Eurogroup meeting, participants include ECB's Lagarde and Cipollone as well as EU Informal meeting of energy ministers (through Tue), EU Agriculture and Fisheries Council and EU-Jordan Assn Council. EU's Ferreira speech at 'Future of Cohesion Policy 2028-34 from a Fiscal Policy Perspective' event organised by ZEW. Estonia's PM Kallas reportedly set to offer her resignation as she prepares to take up a role at EU Commission
Politics/Macro/World News
Bank of England's Dhingra says rates should come down now - Reuters
Property asking prices slip, says Rightmove, as house sellers list lower to attract cautious buyers - This is Money
Finland Jun CPI +1.3% y/y vs consensus +1.3% and prior +1.5%
Top company news
Earnings/updates
UHR.SW (Swatch Group) -- reports H1 net income CHF147M vs consensus CHF365.2M; expects the situation to improve strongly in H2
TSCO.LN (Tesco plc) -- Tesco targeting extra £1B in sales for upmarket range Finest - FT, citing CEO
NDA.SE.SS (Nordea Bank) -- reports Q2 EPS €0.37 vs FactSet €0.37 [15 est, €0.31-0.40]
IBE.SM (Iberdrola) -- reports provisional Q2 total net electricity production 30,016 GWh, (24.6%) y/y
MOWI.NO (Mowi) -- reports Q2 operational EBIT €230M vs FactSet €261.2M [13 est, €207-331M]
NDX1.GR (Nordex) -- reports H1 order intake 3.4 GW
TOM2.NA (TomTom) -- reports Q2 net income (€2.3M) vs consensus (€4M); now guides FY FCF (excl. restructuring) as % of Group revenue 1-5% vs prior guidance > 5%
ORK.NO (Orkla) -- releases Jotun Q2 update
ORK.NO (Orkla) -- reports Q2 EPS NOK1.66 ex-items vs consensus NOK1.48
DRW3.GR (Drägerwerk) -- reports preliminary Q2 EBIT €41M vs FactSet €21.7M [3 est, €10-28.3M]
COP.GR (CompuGroup Medical) -- reports H1 adj EPS €0.81 vs year-ago €1.07; issues full FY24 guidance
GJF.NO (Gjensidige Forsikring) -- Follow-up: Gjensidige Forsikring reports Q2 net income NOK1.39B vs consensus NOK1.55B
GJF.NO (Gjensidige Forsikring) -- reports Q2 net income NOK1.39B vs consensus NOK1.55B
EVE.SW (Evolva Holding) -- receives exemptions for maintaining its SIX Swiss Exchange listing, will publish IFRS financial statements on or before 31-Oct
Also reporting today
Earnings:
Nordics: AddLife (ALIF.B.SS), Volati (VOLO.SS), Note (NOTE.SS), Traction (TRAC.B.SS), Ependion (EPEN.SS), Rejlers (REJL.B.SS), Sagax (SAGA.B.SS), Magnora (MGN.NO), Smartoptics (SMOP.NO), Philly Shipyard (PHLY.NO)
UK: ME Group International (MEGP.LN)
Trading Update: Alphawave IP Group (AWE.LN), Robert Walters (RWA.LN), CATANA Group (CATG.FP)
M&A
AIR.FP (Airbus) -- and Thales considering a merger of their space activities -- La Tribune
FIL.CN (Filo Corp.) -- Lundin Mining has reportedly approached BHP regarding a joint bid for Filo Corp - Bloomberg
BG (Bunge Global) -- To gain clearance for merger, Bunge, Viterra offer to sell assets in two EU countries - Reuters (12:02 ET/17:02 BST)
GRF.SM (Grifols) -- adopts resolutions regarding the announcement of a possible transaction to be carried out jointly by the family shareholders and Brookfield
VOW3.GR (Volkswagen) -- Mahindra & Mahindra among contenders for 15-20% stake in Skoda Auto Volkswagen India - Moneycontrol (08:31 IT/05:01 CET)
FRAS.LN (Frasers Group) -- Opinions differ on Frasers Group's strategy of buying real estate - Sunday Times
Cinven has held initial talks with potential buyers of Viridium - Bloomberg
Healthcare
MOR.GR (Morphosys) -- announces voluntary delisting of ADSs from Nasdaq
IPN.FP (Ipsen) -- China's NMPA approves Ipsen's Diphereline for central precocious puberty
ADXN.SW (Addex Therapeutics) -- reports availability of abstract for upcoming presentation
Other
TKA.GR (ThyssenKrupp) -- Dispute breaks out at ThyssenKrupp over future direction of steel business - Handelsblatt
CNA.LN (Centrica) -- looking for successor to chairman Scott Wheway - Sky News
BCG.LN (Baltic Classifieds Group) -- holder Antler EquityCo to sell 30M shares via accelerated bookbuilding through BofA
Estimated weekend box office revenues in US, Canada $124.4M, (11.4%) y/y - Box Office Mojo
Rio Tinto, Ngarluma Aboriginal Corporation to pursue development of 80MW solar farm to supply renewable energy to Rio's iron ore operations in the Pilbara region
Shenzhen Transsion faces lawsuits for patent infringements from Qualcomm and Philips - FT
Key rating changes
Upgrades
GLEN.LN (Glencore) -- to overweight from equal weight at Barclays
ALIV.SS (Autoliv) -- to hold from sell at ABG Sundal Collier
MTRS.SS (Munters Group) -- to buy from hold at ABG Sundal Collier
Initiations
BANB.SW (Bachem Holding) -- underweight at Barclays
TOM.NO (Tomra Systems) -- neutral at Sparebank 1 Markets
LHA.GR (Deutsche Lufthansa) -- to sell from hold at Stifel
OCDO.LN (Ocado Group) -- to underperform from outperform at Bernstein
BPE.IM (BPER Banca) -- to market perform from outperform at Keefe, Bruyette & Woods
Data
Nikkei closed
Hang Seng (1.26%) to 18062.37
Shanghai Composite +0.08% to 2973.59
S&P futures +14.8 vs prior close of 5664.8
€-$ +0.0000 or +0.00% to 1.0894
$-¥ (0.20) or (0.12%) to 157.96
€-¥ (0.18) or (0.10%) to 172.09
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