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StreetAccount Summary - EU Market Recap: FTSE 100 (1.36%) to 8190.61, DAX (0.20%) to 19066.47, CAC40 (0.72%) to 7521.32, STOXX 600 (0.55%) to 516.64

Oct 08 ,2024

  • Synopsis:

    • European equity markets closed lower. Spain +0.2% and Switzerland slightly higher buck the lower trend and lead outperformers, whilst Norway and the UK(1.4%), and Finaland (1.1%) lead underperformers.

    • Risk appetite weaker as China policymakers offered little detail on stimulus measures at high-profile press conference. Economic calendar relatively light today, so focus squarely on China, although some focus still on Middle East and hawkish Fed repricing amid continued support for soft- or even no-landing scenarios. Some notable Fedspeak overnight with patience the watchword Bostic, Collins, and Jefferson all speaking later today.

    • Focus in Europe on ECB hawk Nagel supporting October rate cut, and agreed with German government's revised forecast for an economic contraction this year. Germany industrial production beat expectations. France trade balance worse than expected. Bank of Italy expressed concern about Italy's growth. UK business confidence slipped as fears over budget tax rises grow.

    • On the macro calendar, Germany industrial production beat expectations coming in at +2.9% m/m vs consensus +0.8%. Increase largely driven by significant +19.3% jump in automotive production. Energy and construction sectors also saw modest growth. However, despite this monthly improvement, production remains (1.3%) lower on a three-month basis and (2.7%) below August 2023 levels. France Aug Trade Balance worse than expected at (€7.4B) vs consensus (€5.5B) and prior revised (€6.0B) from (€5.9B). In UK, total retail sales up +2% y/y, above 12-month average. Meanwhile, China reportedly studying higher taxes on imported EU brandy and large engine cars.

    • Amidst limited earnings and trading updates, out of DACHs, VAT Group (VACN.SW) expects Q3 revenue to fall below guidance of CHF235-255M due to technical issues from the new ERP solution implementation in Switzerland that started in August. Delivery Hero (DHER.GR) releases Talabat Capital Markets Event material. In the UK, Vistry Group (VTY.LN) now expects FY24 adjusted PBT to be c. £350M due to one-off impact of adjusting for the revised development cost assumptions. Imperial Brands PLC (IMB.LN) issues FY24 trading update, hikes FY24 dividend by 4.5% and announces FY25 dividend and buyback. Senior plc (SNR.LN) notes Aerospace is facing temporary near-term customer related headwinds. Citycon (CTY1S.FH) guides FY24 adj. EPRA EPS €0.45-0.49 vs prior €0.46-0.52 and FactSet €0.55; revised guidance is mainly due to the combined effect of the executed divestments of Kongssenteret and Trekanten, the weakening NOK and SEK FX -rates in Q3/2024, postponed completion of Barkarby residential project, as well as previously announced one-time reorganization cost.

    • In M&A, Holcim (HOLN.SW) to acquire OX Engineered Products, U.S. provider of advanced insulation systems for residential and commercial applications; terms undisclosed. DS Smith (SMDS.LN) shareholders approve acquisition by International Paper (IP). Fnac Darty (FNAC.FP) lowers minimum threshold condition to 66.67% from 90% in connection with offer for UniEuro (UNIR.IM).

    • Looking ahead to tomorrow's calendar (see - Europe Week Ahead: 07-Oct to 11-Oct attached), in another relative light day for company earnings, Investment AB Oresund (ORES.SS), Diamyd Medical (DMYD.B.SS), Admicom (ADMCM.FH), Netcall (NET.LN), CMC Markets (CMCX.LN), Salzgitter (SZG.GR), Bechtle (BC8.GR), Traton (8TRA.GR) pre-close call, Gurit Holding (GURN.SW) will be among other names to update investors, whilst the macro-calendar releases will include Germany Aug trade balance, Denmark Aug trade balance, Ireland Aug industrial production.

  • Digest:

    • Sectors - STOXX Europe 600:

      • Outperformers:

        • Utilities +0.60%, Telecom +0.52%, Personal Care Drug and Grocery Stores +0.41%, Media +0.35%, Travel & Leisure +0.33%, Construct & Mtls (0.10%), Technology (0.10%), Ind Goods & Svcs (0.16%), Real Estate (0.18%), Retail (0.28%), Health Care (0.30%), Financial Svcs (0.35%),

      • Underperformers:

        • Basic Resources (4.45%), Energy(2.22%), Consumer Products and Services (2.17%), Banks (1.14%), Autos & Parts (0.86%), Food, Beverage and Tobacco (0.63%), Chemicals (0.61%),

    • Macro/Peripheral markets:

      • Geopolitics

        • Israel Says Hezbollah Chief's Likely Successor Apparently Killed - Bloomberg

        • Hezbollah claims to have killed Israeli soldiers crossing border; UN warns Lebanon faces 'spiral of doom' - The Guardian

        • Ukraine could be facing toughest winter since invasion began, NATO chief says - Reuters

        • Stoltenberg confirmed as next Munich Security Conference chair - Baha

      • Central banks

        • ECB's Centeno: Easing cycle to be faster than expected - Baha

      • EU

        • China targets EU brandy imports with anti-dumping penalties - FT

        • ECB's Private Credit Probe Finds Banks Don't See Full Exposures - Bloomberg

      • UK

        • Russia and Iran want 'sustained mayhem' in UK, MI5 warns - The Times

        • Labour poll lead over Tories falls to one point - The Telegraph

        • HS2 may now run to central London, minister says - BBC

      • France

        • France's army faces deterrence test against Putin's Russia - Politico

      • Germany

        • German Economy May Contract in 2024, Bundesbank Chief Nagel Says - Bloomberg

        • New SPD General Secretary starts with a declaration of war on Friedrich Merz - Handelsblatt

        • This is what Friedrich Merz's tax reform could look like - Handelsblatt

      • Spain

        • EU Warns Spain on Risks of Missing Deadlines for Budget Plans - Bloomberg

      • Norway

        • Norway raises terrorism alert level due to Middle East conflict - Reuters

      • Hungary

        • Orban's €500 Million North Macedonia Loan Displays Balkans Clout - Bloomberg

    • Company news:

      • Trading Higher:

        • +35.6% RLF.SW (RELIEF THERAPEUTICS Holding CHF3.50, +1.05) -- promising preliminary results of RLF-TD011 clinical trial in epidermolysis bullosa

        • +18.0% HBC.NO (Hofseth BioCare NOK1.80, +0.28) -- study results

        • +13.9% IBU.GR (IBU-tec advanced materials €10.30, +1.29) -- order

        • +13.5% SRI.IM (Servizi Italia €2.08, +0.28) -- Cometa S.r.l. announces €2.37/share in cash tender offer for company; suspends share buy-back program

        • +8.8% GNC.LN (Greencore Group £1.89, +0.16) -- FY trading update

        • +7.9% GHH.LN (Gooch & Housego £4.20, +0.31) -- FY trading update

        • +5.0% GKP.LN (Gulf Keystone Petroleum £1.31, +0.06) -- updates on shareholder distributions; announces $20M divi and $10M share buyback; appoints new interim Chair

        • +4.4% DHER.GR (Delivery Hero €38.73, +1.66) -- releases Talabat Capital Markets Event material

        • +4.4% IMB.LN (Imperial Brands £22.36, +0.94) -- FY trading update

        • +3.0% LGRS.LN (Loungers £2.71, +0.08) -- trading update

        • +2.2% PRIC.B.SS (Pricer SEK11.38, +0.24) -- Co-operative retailer S Group installs comapny's digital in-store solution in over 100 additional stores

      • Trading Lower:

        • -23.1% VTY.LN (Vistry Group £8.31, -2.94) -- FY trading update

        • -13.5% SNR.LN (Senior £1.23, -0.20) -- FY trading update

        • -6.6% CTY1S.FH (Citycon €3.89, -0.27) -- guides FY

        • -6.0% RCO.FP (Remy Cointreau €62.60, -3.95) -- China's Ministry of Commerce to implement temporary anti-dumping measures on imported related brandy originating from the EU

        • -5.5% TGS.NO (TGS-NOPEC Geophysical Co. NOK101.50, -5.75) -- prelim Q3 earnings

        • -4.9% KER.FP (Kering €233.70, -12.05) -- Luxury sector sympathy move after China NDRC did not announce any new large fiscal stimulus

        • -4.8% BRBY.LN (Burberry Group £6.33, -0.32) -- Luxury sector sympathy move after China NDRC did not announce any new large fiscal stimulus

        • -4.1% PRU.LN (Prudential £6.79, -0.29) -- sympathy move after China NDRC did not announce any new large fiscal stimulus

        • -4.0% CTNK.GR (centrotherm international €3.84, -0.16) -- H1 earnings

        • -3.7% MC.FP (LVMH Moet Hennessy Louis Vuitton €651.00, -25.30) -- China's Ministry of Commerce to implement temporary anti-dumping measures on imported related brandy originating from the EU

        • -3.7% OMV.AV (OMV €38.84, -1.48) -- Q3 trading update

        • -3.6% RI.FP (Pernod Ricard €127.55, -4.75) -- China's Ministry of Commerce to implement temporary anti-dumping measures on imported related brandy originating from the EU

        • -2.7% CFR.SW (Richemont CHF129.15, -3.55) -- Luxury sector sympathy move after China NDRC did not announce any new large fiscal stimulus

        • -2.6% PRX.NA (Prosus €39.04, -1.06) -- Tencent sympathy

        • -2.6% IQE.LN (IQE £0.20, -0.01) -- appoints new Chair

        • -2.4% BOUL.SS (Boule Diagnostics SEK8.22, -0.20) -- reports one-off non-cash cost of SEK 265 M in Q3

        • -2.0% BMW.GR (Bayerische Motoren Werke €76.38, -1.58) -- Nissan Motor announces agreement to become 25% holder in ChargeScape

        • -1.9% CPR.IM (Davide Campari-Milano €7.26, -0.14) -- China's Ministry of Commerce to implement temporary anti-dumping measures on imported related brandy originating from the EU

        • -1.9% MONC.IM (Moncler €53.14, -1.04) -- Luxury sector sympathy move after China NDRC did not announce any new large fiscal stimulus

        • -1.8% SIE.GR (Siemens AG €179.68, -3.26) -- to acquire Danfoss Fire Safety

    • EU companies reporting tomorrow:

      • Earnings: Investment AB Oresund (ORES.SS), Diamyd Medical (DMYD.B.SS), Admicom (ADMCM.FH), Netcall (NET.LN)

      • Trading Update: CMC Markets (CMCX.LN)

      • CMD/events: Salzgitter (SZG.GR), Bechtle (BC8.GR), Traton (8TRA.GR) pre-close call, Gurit Holding (GURN.SW)

  • Data:

    • Economics:

      • Netherlands Sep CPI +3.5% y/y vs preliminary +3.5%

      • Germany Aug Industrial Production +2.9% m/m vs consensus +0.8% and prior revised (2.9%) from (2.4%)

      • Sweden Sep CPI +1.6% y/y vs consensus +2.2% and prior +1.9%

      • France Aug Trade Balance (€7.4B) vs consensus (€5.5B) and prior revised (€6.0B) from (€5.9B)

      • UK BRC retail sales show uplift in spending ahead of Christmas season:

    • Markets:

      • WTI Crude (Nov 24): ($3.91) or (5.07%) to $73.23

      • €-$ (0.0012) or (0.11%) to 1.0965

      • £-$ +0.0002 or +0.02% to 1.3085

      • €-£ (0.0011) to 0.8379

      • S&P 500 +0.73%

      • Performance year-to-date

        • FTSE 100: +5.91%

        • DAX: +13.82%

        • CAC: (0.29%)

        • MIB: +11.10%

        • Stoxx 600: +7.86%

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