Jul 16 ,2024
Synopsis
European equity markets are set to open in negative territory amidst Asian equities mixed Tuesday. Hang Seng leading China market declines with property developers under pressure for a second session. Nikkei logging mild gains as Japan resumes trade following Monday holiday. Shares in Korea, Australia and Taiwan little changed. S&P 500 futures edging higher afterhours. Treasury and JGB curves bull flattening with yields down 1-2 bp. Australian bonds rallying. Dollar seeing across-the-board gains. Muted price action in gold and crude. Copper pulling back further. Bitcoin extending rally towards one-month high.
Markets continue to process political implications of assassination attempt on Trump, as his election odds firmed and fueled momentum in trades likely to be influenced by his policies. Also bringing into sharper view likely impact of Trump's protectionist policies with economists warning of sizable hit to Chinese growth from 60% tariffs.
On today's agenda, EU Parliament plenary (through Fri), kick's off at 10:00CET, with it's first act after its constitution is to elect its President for the next two-and-a-half years (half the legislature). Further, EU's Employment, Social Policy, Health and Consumer Affairs Council meet. EU's Simson participates in debate at event hosted by European Energy Forum. G7 Trade Ministers' Meeting (through Wed). In addition, Russia's Foreign Minister Sergey Lavrov chairs open ministerial-level debate on multilateral cooperation for a more just, democratic and sustainable world order.
In central banks, publication at 12noon CET of selected articles from latest Bundesbank monthly report. ECB bank lending survey released at 10:00CET. Elsewhere, ECOFIN meeting, participants include ECB's de Guindos.
Macroeconomic data include: Germany Jul ZEW survey, Italy Jun final CPI, May trade balance, Eurozone May trade balance, UK Jul house price index - Rightmove
In corporate news, Nordics earnings in focus. Elisa Oyj (ELISA.FH) reports Q2 EPS €0.57 ex-items vs FactSet €0.58 and reaffirms FY guidance. Swedbank (SWED.A.SS) reports Q2 EPS SEK7.61 vs consensus SEK7.07. Skandinaviska Enskilda Banken (SEB.A.SS) posted Q2 earnings and announced yesterday after the close that it had completed SEK2.0B share buyback programme and initiates new SEK 2.5B buyback programme. Camurus (CAMX.SS) reports Q2 EPS SEK1.25 vs FactSet SEK1.47.
From the DACH region, Richemont (CFR.SW) reports Q1 sales €5.27B vs consensus €5.30B. DKSH Holding (DKSH.SW) H1 EPS CHF1.71 vs consensus CHF1.49 and confirmed outlook for 2024.
On M&A front, EQT and Temasek reportedly seeking to sell O2 Power.
Macro/World/Politics
Why von der Leyen is banking on parliament choosing her over chaos - FT
German 2025 budget draft has a 17 billion euros hole, sources - Reuters
Italy, Spain back EU duties on China-built EV imports - Reuters
UK, EU States to Target Russian Oil Fleet With More Checks - Bloomberg
The French left never had a plan for winning, and it could cost them their victory - Politico
Top company news
Earnings/updates
DACHs
BOSS.GR (Hugo Boss) -- guides Q2 EBIT €70M vs year-ago €121M
DKSH.SW (DKSH Holding) -- reports H1 EPS CHF1.71 vs consensus CHF1.49; Confirmed outlook for 2024
CFR.SW (Richemont) -- reports Q1 sales €5.27B vs consensus €5.30B
Southern Europe
EDP.PL (EDP-Energias de Portugal) -- reports Q2/H1 operating data
EDPR.PL (EDP Renovaveis) -- reports H1 operating data: Electricity generation +5% y/y
France
ABVX.FP (Abivax) -- provides operational and key program updates; names Sheldon Sloan as Chief Medical Officer; cash runway potential to extend into Q1 2026
SCR.FP (SCOR SE) -- provides update on Q2 and FY24 results
Nordics
SWED.A.SS (Swedbank) -- reports Q2 EPS SEK7.61 vs consensus SEK7.07
SEB.A.SS (Skandinaviska Enskilda Banken) -- reports Q2 EPS SEK4.54 vs consensus SEK4.22
HTRO.SS (Hexatronic Group) -- reports Q2 EPS SEK0.44 vs FactSet SEK0.51 [3 est, SEK0.48-0.56]
WITH.FH (WithSecure) -- reports Q2 EPS (€0.02) vs FactSet (€0.01) [5 est, (€0.02)-0.00]
SOFF.NO (Solstad Offshore) -- reports Q2 EPS (NOK0.01) vs FactSet NOK3.41 [1 est]
NCC.B.SS (NCC) -- reports Q2 EPS SEK4.83 vs consensus SEK4.47
ELISA.FH (Elisa Oyj) -- reports Q2 EPS €0.57 ex-items vs FactSet €0.58 [12 est, €0.55-0.61]; reaffirms FY guidance
BERG.B.SS (Bergman & Beving) -- reports Q1 net income SEK58M vs FactSet SEK58.5M
M&A
EQT.SS (EQT AB) -- EQT and Temasek seeking to sell O2 Power- Mint
EMEIS.FP (Emeis SA) -- emeis announces signature of real estate promissory sales agreement concerning assets in Portugal worth total value of €24M
Healthcare
PHO.NO (PhotoCure) -- and Richard Wolf enter into agreement to develop a high-definition flexible blue light cystoscope for global commercialization
VSC.GR (4SC) -- receives orphan drug status (ODs) for resminostat (Kinselby) in cutaneous t-cell lymphoma in Switzerland
Other
ERIC.B.SS (Telefonaktiebolaget LM Ericsson) -- Street Takeaways - Telefonaktiebolaget LM Ericsson Q2 Earnings
ERF.FP (Eurofins Scientific) -- Follow up: Eurofins Disputes the Validity of SGS' Purported Termination of the agreement to Divest Its Crop Science Operations to Eurofins
SEB.A.SS (Skandinaviska Enskilda Banken) -- completes latest SEK2.0B share buyback programme and initiates new SEK 2.5B buyback programme
TGS.NO (TGS-NOPEC Geophysical Co.) -- wins Ultra High Resolution 3D (UHR3D) acquisition contract in Europe
TRST.LN (Trustpilot Group) -- holder Trafalgar Acquisition to sell ~12.5M shares via accelerated bookbuild through Berenberg
ALCOX.FP (Nicox) -- Chairman, Jean-François Labbe retires
Key rating changes
Upgrades
MRL.SM (MERLIN Properties SOCIMI) -- to buy from neutral at Van Lanschot Kempen
AAF.LN (Airtel Africa) -- to overweight from neutral at JPMorgan
HELN.SW (Helvetia Holding) -- to buy from reduce at Kepler Cheuvreux
Downgrades
BALN.SW (Baloise)-- to reduce from hold at Kepler Cheuvreux
GSF.NO (Gjensidige Forsikring) -- to sell from hold at Berenberg
BOSS.GR (Hugo Boss) -- to neutral from outperform at Oddo
Initiations
FDJ.FP (La Francaise des Jeux) -- outperform at Bernstein
Data
Nikkei +0.31% to 41320.35
Hang Seng (1.21%) to 17797.15
Shanghai Composite (0.10%) to 2970.98
S&P futures +10.5 vs prior close of 5683.0
€-$ (0.0006) or (0.05%) to 1.0889
$-¥ +0.64 or +0.41% to 158.71
€-¥ +0.59 or +0.34% to 172.82
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