Jul 19 ,2024
Synopsis:
European equity markets ended lower on Friday. Follows a mixed close on Thursday. Travel/leisure, basic resources, autos and insurance the biggest decliners whilst healthcare, personal care and telecom relative outperformers.
Big story today is the major global Microsoft outage disrupting banks, airlines, and emergency services worldwide, affecting Microsoft 365 apps and Azure cloud services. Travel sector reportedly worst affected as number of airlines have grounded flights. Media, banks, healthcare systems also affected. London Stock Exchange earlier flagged issues though seemingly resolved at the moment.
Initial macro-focus on UK retail sales, which came in much worse than expected. Follows yesterday's softer labour market data, allowing markets to increase August BoE easing bets. German PPI slightly higher m/m but in-line y/y. Following yesterday's ECB decision, markets discounting ~80% chance of September cut. Villeroy and Simkus see scope for 2 further rate cuts this year. ECB Survey of Professional Forecasters reported gradual economic recovery and inflation normalisation. However, September may yet be the last rate cut in 2024. Base effects may temporarily lift inflation again in late 2024, with rate cuts returning in 2025, bringing the deposit rate down to 3%. Key dates to watch are 14-Aug for productivity, 22-Aug for negotiated wages, and 6-Sep for both compensation per employee and profits data. In politics, Von der Leyen re-elected as President of the European Commission. Macron's coalition strengthened as centrist Braun-Pivet reelected as National Assembly President.
Amidst a busy earnings calendar, several Nordics names updated investors, including Sandvik (SAND.SS), Danske Bank (DANSKE.DC), Yara International (YAR.NO), Electrolux (ELUX.B.SS), Wartsila (WRT1V.FH), Kone (KNEBV.FH), Saab (SAAB.B.SS) and Skanska (SKA.B.SS) just to mention a few; last night after the close, French names Ubisoft Entertainment (UBI.FP) and Sartorius Stedim Biotech (DIM.FP) also reported Q2/H1 numbers.
Looking ahead to next week EU econ-calendar, Ireland Jun PPI is the only notable release due on Monday.
Digest:
Sectors - STOXX Europe 600:
Outperformers
Health Care (0.10%), Personal Care Drug and Grocery Stores (0.30%), Telecom (0.36%), Banks (0.68%), Ind Goods & Svcs (0.72%), Media (0.62%)
Underperformers
Travel & Leisure (2.12%), Basic Resources (2.16%), Autos & Parts (1.86%), Insurance (1.48%), Chemicals (1.44%), Real Estate (1.15%), Financial Svcs (1.00%), Oil&Gas(1.03%), Consumer Products and Services (1.25%), Technology (1.11%), Food, Beverage and Tobacco (0.91%), Construct & Mtls (0.96%), Utilities (0.89%)
Macro:
Company news:
Notable Gainers
+22.7% ABLI.SS (Abliva SEK0.27, +0.05) -- interim analysis of the FALCON study for KL1333 in primary mitochondrial disease
+13.3% TOM.NO (Tomra Systems NOK168.00, +19.70) -- Q2 earnings
+11.8% SINCH.SS (Sinch SEK26.38, +2.78) -- Q2 earnings
+7.8% SMHN.GR (SÜSS MicroTec €60.80, +4.40) -- prelim Q2 earnings
+7.7% DANSKE.DC (Danske Bank DKK214.90, +15.35) -- Q2 earnings
+7.3% HNSA.SS (Hansa Biopharma SEK41.64, +2.84) -- SEB upgrade
+5.7% CONSTI.FH (Consti €10.30, +0.56) -- Q2 earnings
+5.1% BILL.SS (Billerud SEK107.30, +5.20) -- Q2 earnings
+4.8% MIPS.SS (MIPS SEK545.00, +25.00) -- Jefferies upgrade
+4.7% ATT.SS (Attendo SEK46.00, +2.05) -- to buy back shares for a maximum amount of SEK 150M; Q2 earnings
+4.5% LIAB.SS (Lindab International SEK262.00, +11.40) -- Q2 earnings
+3.7% YAR.NO (Yara International NOK312.90, +11.10) -- Q2 earnings
+2.5% ACAD.SS (AcadeMedia SEK52.90, +1.30) -- prelim Q4
+2.3% IVSO.SS (INVISIO SEK268.00, +6.00) -- Q2 earnings
+2.3% ELUX.B.SS (Electrolux SEK92.42, +2.04) -- Q2 earnings
Notable Decliners
-17.3% VBG.B.SS (VBG Group SEK410.50, -86.00) -- plans to consolidates its operations in Canada; Acquires land to establish a new production facility
-16.3% DIM.FP (Sartorius Stedim Biotech €146.85, -28.65) -- H1 earnings
-15.2% SRT3.GR (Sartorius €209.10, -37.60) -- H1 earnings
-14.0% UBI.FP (Ubisoft Entertainment €19.38, -3.17) -- Q1 revenue
-12.0% MSAB.B.SS (Micro Systemation SEK42.40, -5.80) -- Q2 earnings
-11.7% FIA1S.FH (Finnair €2.33, -0.31) -- Q2 earnings
-8.8% BOL.SS (Boliden SEK312.30, -30.20) -- Q2 earnings
-8.3% EVO.SS (Evolution SEK1,066.50, -96.00) -- Q2 earnings; to acquire Galaxy Gaming for ~$85M; announces capital allocation framework share buyback of up to €400M
-7.9% SOP.FP (Sopra Steria Group €174.20, -14.90) -- H1 earnings
-7.7% CEVI.SS (CellaVision SEK257.50, -21.50) -- Q2 earnings
-7.1% CTT.SS (CTT Systems SEK286.00, -22.00) -- Q2 earnings
-7.0% BYS.SW (Bystronic CHF354.50, -26.50) -- H1 earnings
-6.4% FAG.SS (Fagerhult Group SEK69.30, -4.70) -- Q2 earnings
-6.4% SAAB.B.SS (Saab SEK250.55, -17.15) -- Q2 earnings
-6.2% BEIA.B.SS (Beijer Alma SEK213.00, -14.00) -- Q2 earnings
-5.0% MAU.FP (Maurel et Prom €6.05, -0.32) -- appoints new Chair
-4.7% ENEA.SS (Enea AB SEK82.40, -4.10) -- ABG Sundal Collier downgrade
-4.2% HUSQ.B.SS (Husqvarna SEK76.56, -3.32) -- Nordea and SEB downgrades; transferred hold at Handelsbanken
-3.8% AXW.FP (Axway Software €27.50, -1.10) -- H1 earnings
-3.6% BETS.B.SS (Betsson SEK128.78, -4.76) -- Q2 earnings
-3.3% MIKN.SW (Mikron Holding CHF19.00, -0.65) -- H1 earnings
-3.1% TUI1.GR (TUI Group €6.55, -0.21) -- successfully places €487M convertible bonds
-3.1% SZG.GR (Salzgitter €16.62, -0.53) -- prelim Q2 earnings
-2.2% HUM.SS (Humana AB SEK33.50, -0.75) -- Q2 earnings; to divest its Danish operations; sale will result in a capital loss of approx. SEK8M
-1.8% CO.FP (Casino Guichard-Perrachon €3.91, -0.07) -- confirms that Guichard-Perrachon subject of a preliminary investigation by the National Financial Prosecutor's Office
EU companies reporting tomorrow:
Earnings:
DACHs: SAP (SAP.GR), Logitech International (LOGN.SW), BELIMO Holding (BEAN.SW)
France: Covivio (COV.FP), Icade (ICAD.FP)
Nordics: Fenix Outdoor International (FOI.B.SS), Stillfront Group (SF.SS), Boule Diagnostics (BOUL.SS)
Southern Europe: Galp Energia (GALP.PL), The Navigator Co. (NVG.PL), Almirall (ALM.SM), CIE Automotive (CIE.SM), MERLIN Properties (MRL.SM)
UK/Ireland: MONY Group (MONY.LN), Ryanair Holdings (RYA.ID)
Data:
Economics:
Germany Jun PPI y/y (1.6%) vs consensus (1.6%) and prior (2.2%)
UK Jun
Retail Sales y/y (0.2%) vs consensus +0.2% and prior revised to +1.7% from +1.3%
Public Sector Net Borrowing £13.59B vs consensus £10.8B and prior revised £15.57B from £14.10B
Markets:
WTI Crude (24-Aug): ($1.07) or (1.29%) to $81.75
€-$ (0.0009) or (0.08%) to 1.0889
£-$ (0.0028) or (0.22%) to 1.2917
€-£ +0.0011 to 0.8430
S&P 500 (0.59%)
Performance year-to-date:
FTSE 100: +5.46%
DAX: +8.48%
CAC: (0.11%)
MIB: +12.63%
Stoxx 600: +6.48%
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