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StreetAccount Summary - EU Market Recap: FTSE 100 +0.49% to 8070.07, DAX +1.26% to 19242.73, CAC40 +1.31% to 7311.35, STOXX 600 +1.06% to 506.90

Nov 14 ,2024

• Synopsis:

  • European equity markets ended mostly higher with pan-European indices just off best levels. Austria +2.2%, Netherlands +2.0% and Norway +1.8% led the outperformers whilst Denmark and Greece both down (0.1%) bucked the firmer trend.

  • Market participants still track familiar themes. European markets lag US peers as concerns over Trump trade policies weigh on sentiment. Promises over tax cuts has increased spotlight on deficit levels and likelihood of higher borrowing. German election campaign also looks likely to see wider debate on changing debt rule to accommodate higher borrowing. While concerns over a growth slowdown in Europe has elevated ECB rate cut expectations, more government spending could have implications for medium-term inflation expectations. Yet, ECB insiders suggest back-to-back 25bps cuts appropriate into 2025.

  • Macro data in Europe includes more upbeat UK house price data from RICS. Eurozone employment, GDP and industrial production due. October ECB minutes noted little risk seen in cutting rates with policy still restrictive. Inflation outlook affected by softer indicators of economic activity, but too early to declare victory. In the US, October core PPI in line, though final demand services accelerated slightly. Initial jobless claims came in below consensus. Continuing claims in line and down slightly w/w, though still holding near cycle high. Fed Governor Kugler highlighted disinflation trends, rebalanced labor market, but said pause appropriate if progress stalls or inflation reaccelerates.

  • On a busy earnings front, in the DACH region, Deutsche Telekom (DTE.GR) reported Q3 numbers and raised FY Adjusted EBITDA AL guidance. Siemens AG (SIE.GR) reported strong Q4 ahead of consensus and provided FY25 outlook. E.ON SE (EOAN.GR) posted in-line 9M adjusted net income and EBITDA and confirmed FY guidance. Merck KGaA (MRK.GR) posted better -than-expected Q3 EPS & EBIT pre one-time items, while net sales were a miss; confirmed and specified FY24 guidance.

  • In the UK, Aviva (AV.LN) shares traded higher post Q3 trading update with company reporting gross premiums written of £9.12B, +13% y/y and adding it was confident in achieving its FY group targets. B&M European Value Retail (BME.LN) was also higher post H1 numbers. Burberry Group (BRBY.LN) shares soared following H1 numbers and strategic update.

  • In France, SCOR SE (SCR.FP) reported Q3 adj net income €150M vs consensus €116M. Alstom (ALO.FP) posted H1 earnings mostly in line with expectations, FCF, order and adjusted EBIT ahead of expectationt. Casino Guichard-Perrachon (CO.FP) presented strategic plan "Renouveau 2028". Elsewhere, ASML (ASML.NA) confirmed potential 2030 scenarios for annual revenue between ~€44B and €60B with gross margin of between ~56% and 60% as part of CMD today. Telecom Italia (TIT.IM) reported Q3 numbers after the close yesterday.

  • On M&A front, Volvo Cars (VOLCAR.B.SS) sold 30% stake in Lynk & Co to Zeekr for RMB 5.4B (~SEK 8B). Embracer Group (EMBRAC.B.SS) to divest Easybrain to Miniclip for consideration of $1.2B (SEK12.9B) on cash and debt free basis. Shell (SHEl.LN) is reportedly looking to sell part of portfolio of nature-based carbon projects. Kuehne & Nagel (KNIN.SW) to acquire 51% stake in IMC Logistics.

• Digest:

  • Sectors - STOXX Europe 600:

    • Outperformers

      • Technology +3.12%, Telecom +1.82%, Autos & Parts +1.68%, Oil & Gas +1.67%, Utilities +1.41%, Media +1.35%, Real Estate+1.31%, Banks +1.25%, Persnl & HHold Goods +1.25%

    • Underperformers

      • Health Care +0.09%, Retail +0.50%, Basic Resources +0.53%, Chemicals +0.55%, Ind Goods & Svcs +0.68%, Insurance +0.82%, Food & Beverage +0.91%, Construct & Mtls +0.99%, Travel & Leisure +1.02%, Financial Svcs +1.02%

  • Macro/Peripheral markets:

    • EU

      • Europe's growth prospects hit by fiscal restraint - FT

      • EU Infighting Risks Delaying Formation of Team to Face Trump - Bloomberg

      • European gas prices surge on potential disruption from Russia - FT

    • Central banks

      • ECB's de Guindos: Good signs on core inflation - Baha

      • Riksbank's latest Financial Stability Report - press release

    • UK

      • Reeves in radical pension shake-up to boost growth - BBC, The Telegraph

      • Budget guarantees job cuts and price rises, shops tell Labour - The Times

      • UK renters hit by housing supply squeeze - FT

    • France

      • Paris prosecutor seeks jail and public office ban for Marine Le Pen - The Gaudian, Reuters

      • France seeking to block EU-Mercosur pact by 'all means' as farmers pile pressure - France24

    • Germany

      • Countries fear standstill in the energy transition due to traffic light exit - Handelsblatt

      • Investor confidence in German bonds is dwindling - Handelsblatt

      • Germany tells its ports to reject Russian gas cargoes - FT

    • Finland

      • Finnish Economy Posts Third Quarterly Gain in a Sign of Recovery - Bloomberg

    • Norway

      • Norway holds oil and gas investment record for 2024 - Baha

  • Company news:

    • Notable Gainers

      • +29.1% BIOA.B.SS (BioArctic SEK195.50, +44.10) -- Q3 earnings

      • +19.9% ADN1.GR (adesso €80.10, +13.30) -- Q3 earnings; new CFO

      • +19.3% BRBY.LN (Burberry Group £8.74, +1.41) -- H1 earnings

      • +15.8% DOC.AV (DO & CO €163.60, +22.20) -- H1 earnings

      • +14.1% SUS.SS (Surgical Science Sweden SEK138.20, +17.10) -- Q3 earnings

      • +11.4% ALO.FP (Alstom €21.89, +2.24) -- H1 earnings

      • +10.9% BMPS.IM (Banca Monte dei Paschi di Siena €6.12, +0.60) -- Italy's Treasury to cut stake in Banca Monte dei Paschi di Siena - Reuters;

        • Anima purchases 3% of the share capital of Banca Monte dei Paschi di Siena as part of placing by Ministry of Economy and Finance;

        • Banco BPM acquires a 5% stake in Banca Monte dei Paschi di Siena as part of placing by Ministry of Economy and Finance;

        • Italy's Delfin buys 3.5% stake in Banca Monte dei Paschi di Siena -- Reuters, citing sources

      • +10.8% SCR.FP (SCOR SE €22.70, +2.22) -- Q3 earnings

      • +8.7% HEIJM.NA (Heijmans €27.50, +2.20) -- initiated outperform at Oddo

      • +8.6% KIE.LN (Kier Group £1.51, +0.12) -- trading update

      • +8.1% IMP.A.SS (Implantica SEK43.15, +3.25) -- submits FDA PMA application Clinical Module 2 for RefluxStop for U.S. market approval

      • +8.0% SWON.SW (SoftwareONE Holding CHF7.72, +0.57) -- Cantor Fitzgerald upgrade

      • +7.7% DEME.BB (DEME Group €132.20, +9.40) -- 9M revenue

      • +7.0% ASML.NA (ASML Holding €671.30, +44.00) -- CMD update

      • +6.9% FGP.LN (FirstGroup £1.46, +0.09) -- H1 earnings

      • +6.8% EMBRAC.B.SS (Embracer Group SEK28.94, +1.84) -- Q2 earnings

      • +6.8% JDC.GR (JDC Group €23.60, +1.50) -- Q3 earnings

      • +6.6% CRL.IM (Carel Industries €18.54, +1.14) -- BNP Paribas Exane upgrade

      • +6.1% FNM.SS (Ferronordic SEK62.60, +3.60) -- Q3 earnings

      • +6.0% PKTM.SW (PIERER Mobility CHF8.16, +0.46) -- Vontobel downgrade

      • +5.9% ALK.B.DC (ALK-Abello DKK169.20, +9.50) -- Q3 earnings

      • +5.8% IBT.B.SS (Infant Bacterial Therapeutics SEK36.30, +2.00) -- Q3 earnings

      • +5.3% EQNR.NO (Equinor NOK263.40, +13.15) -- commercial oil and gas discovery

      • +5.3% TTG.LN (TT Electronics £0.79, +0.04) -- trading update

      • +5.2% BME.LN (B&M European Value Retail £4.00, +0.20) -- H1 earnings

      • +4.8% NCOD.NO (Norcod NOK20.90, +0.95) -- Q3 earnings

      • +4.7% GFT.GR (GFT Technologies €20.60, +0.93) -- Q3 earnings

      • +4.7% SIE.GR (Siemens AG €187.96, +8.52) -- Q4 earnings

      • +4.5% GN.DC (GN Store Nord DKK139.15, +5.95) -- Kepler Cheuvreux upgrade

    • Notable Decliners

      • -23.8% ALNG.NO (Awilco LNG NOK4.80, -1.50) -- Q3 earnings

      • -22.1% PRS.NO (Prosafe NOK14.40, -4.08) -- Q3 earnings

      • -18.3% STAR.B.SS (Starbreeze SEK0.20, -0.04) -- Q3 earnings

      • -17.3% CO.FP (Casino Guichard-Perrachon €1.69, -0.35) -- strategic plan "Renouveau 2028"

      • -14.1% S92.GR (SMA Solar Technology €11.87, -1.95) -- 9M earnings

      • -12.0% AGFB.BB (Agfa-Gevaert €0.82, -0.11) -- Q3 earnings; plan to adjust the cost base of its traditional film activities to the reality in the market; 530 jobs affected

      • -11.8% AOM.LN (Activeops £1.13, -0.15) -- H1 earnings

      • -11.5% GNFT.FP (GENFIT €4.33, -0.56) -- corporate updates and upcoming participation at The Liver Meeting 2024; NICE recommends Genfit's Iqirvo for previously treated primary biliary cholangitis in adults

      • -9.6% SRAIL.SW (Stadler Rail CHF20.30, -2.15) -- adjusts guidance; notes impact from severe weather disasters

      • -9.3% EBUS.NA (Ebusco Holding €1.39, -0.14) -- updates on its €36M right issue

      • -9.1% QQ.LN (QinetiQ Group £4.24, -0.42) -- H1 earnings

      • -8.4% KLR.LN (Keller Group £14.98, -1.38) -- trading update; new Chair

      • -8.0% NKT.DC (NKT A/S DKK573.00, -49.50) -- Q3 earnings

      • -7.6% NVM.GR (Novem Group €5.62, -0.46) -- Q2 earnings

      • -5.5% CAF.SM (Construcciones y Auxiliar de Ferrocarriles €34.15, -2.00) -- 9M earnings

      • -4.9% WAC.GR (Wacker Neuson €12.92, -0.66) -- Q3 earnings

      • -4.8% NORBT.NO (Norbit NOK89.50, -4.50) -- Q3 earnings

      • -4.6% AERO.SW (Montana Aerospace CHF15.02, -0.72) -- Q3 earnings

      • -4.0% SMWH.LN (WH Smith £12.49, -0.52) -- FY earnings

      • -3.6% LSG.NO (Lerøy Seafood Group NOK49.30, -1.85) -- Q3 earnings

      • -3.6% MRK.GR (Merck KGaA €146.00, -5.50) -- Q3 earnings

      • -3.4% AUSS.NO (Austevoll Seafood NOK94.55, -3.30) -- Q3 earnings

      • -1.8% PYT.AV (Polytec Holding €2.23, -0.04) -- Q3 earnings

  • EU companies reporting tomorrow:

    • Earnings:

      • DACHs: Wüstenrot & Württembergische (WUW.GR), Lang & Schwarz (LUS1.GR), The Platform Group (TPG.GR), Rosenbauer International (ROS.AV)

      • France: Vallourec (VK.FP)

      • Nordics: NIBE Industrier (NIBE.B.SS), Bjorn Borg (BORG.SS), Norva24 Group (NORVA.SS), GARO (GARO.SS), Paxman (PAX.SS), Implantica (IMP.A.SS), Bavarian Nordic (BAVA.DC), Matas (MATAS.DC), SP Group (SPG.DC), Nilfisk Holding (NLFSK.DC), AF Gruppen (AFG.NO), Tokmanni Group (TOKMAN.FH), Orthex (ORTHEX.FH)

      • Southern Europe: Assicurazioni Generali (G.IM), MERLIN Properties (MRL.SM), Lar España Real Estate (LRE.SM)

      • UK: Land Securities Group (LAND.LN), Volex (VLX.LN), Record (REC.LN)

• Data:

  • Economics:

    • Oct CPI

      • Finland +1.1% y/y vs consensus +1.1% and prior +0.8%; +0.5% m/m vs consensus +0.3% and prior +0.3%

      • Sweden +1.6% y/y vs preliminary +1.6%; +0.2% m/m vs preliminary +0.2%

      • Spain Final +1.8% y/y vs preliminary +1.8%; +0.6% m/m vs preliminary +0.6%

    • Netherlands Q3 Preliminary GDP +1.7% y/y vs consensus +0.3% and prior +0.8%; +0.8% q/q vs consensus +0.4% and prior +1.0%

    • Eurozone

      • Q3 GDP +0.9% y/y vs preliminary +0.9%; +0.4% q/q vs preliminary +0.4%

      • Sep Industrial Production (2.8%) y/y vs consensus (2.0%) and prior revised (0.1%) from +0.1%; (2.0%) m/m vs consensus (1.4%) and prior revised +1.5% from+1.8%

    • UK Oct house price balance +16% vs consensus +11% and prior +11% - RICS

  • Markets:

    • WTI Crude (Dec 24): +$0.34 or +0.50% to $68.77

    • €-$ +0.0009 or +0.09% to 1.0576

    • £-$ +0.0003 or +0.02% to 1.2712

    • €-£ +0.0007 to 0.8321

    • S&P 500 (0.09%)

      • Performance year-to-date

      • FTSE 100: +4.36%

      • DAX: +14.87%

      • CAC: (3.07%)

      • MIB: +13.17% Stoxx 600: +5.83%