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StreetAccount Summary - EU Market Recap: FTSE 100 (0.09%) to 8063.61, DAX (0.27%) to 19210.81, CAC40 (0.58%) to 7269.63, STOXX 600 (0.77%) to 503.12

Nov 15 ,2024

• Synopsis:

  • European equity markets finished lower, mostly off session's worst levels, with Norway and Spain bucking the trend at the close. US equities lower in Friday midday trading, near worst levels as stocks extend this week's selloff. Treasuries mixed, though still weaker across the curve for the week. Dollar index up 0.1%, higher by 1.7% for the week. Gold up 0.1%. Bitcoin futures up 1.1%. WTI crude down 0.4%.Commodity-linked sectors like miners and energy were best gainers, while media and pharma biggest decliners. European vaccine making stocks dragged the Stoxx 600 Health Care sharply lower after Trump late Thursday, as expected, picked Robert F. Kennedy Jr (RFK) to lead the Department of Health and Human Services (HHS).

  • On macro front, UK Q3 GDP missed after unexpected contraction in Sept; prelim Q3 GDP saw +0.1% expansion q/q vs consensus +0.2% and prior +0.5%. ONS details showed on the quarter, services sector grew +0.1%, construction sector expanded +0.8%, while production sector fell by (0.2%). Softer quarterly expansion came amid a contraction in Sept GDP, down (0.1%) vs forecast for +0.2% gain and prior +0.2%. UK Sept industrial production fell by (0.5%) m/m vs consensus +0.1%, manufacturing was down (1.0%) m/m vs consensus 0.0% and construction output was +0.1% vs cons +0.3%. Other macro data out of the UK includes Sep Visible Trade Balance (£16.32B) vs consensus (£16.2B) and prior revised (£15.21B) from (£15.06B). Final France and Italy Oct CPI readings were in line with flash. Further in macro headlines today, the European Commission anticipates a return to modest growth into 2025 in its Autumn 2024 Economic Forecast. EC sees Eurozone 2024 GDP at 0.8% unchanged from prior update, forecast 2025 GDP at 1.3% and 2026 at 1.6%. Inflation to more than half in 2024 to 2.4% from 2023 and ease more gradually to 2.1% in 2025 and 1.9% in 2026.

  • Some attention also on Mansion House speeches from BoE Governor Bailey and Chancellor Reeves from Thursday evening. Bailey called for better relations with the EU to boost growth. Reeves unveiled pension reforms to support investment and said will give regulators order to focus on growing economy with regulation going too far after GFC. In Germany, CDU clarified position on debt brake reform after SPD offered talks to get it done before the end of the legislative period.

  • On the reporting front, in Nordics, Tokmanni Group (TOKMAN.FH), AF Gruppen (AFG.NO), Bavarian Nordic A/S (BAVA.DC), and NIBE Industrier (NIBE.B.SS) reported Q3 earnings this morning. In the Netherlands, Aegon (AGN.NA) issued a Q3 trading update beating expectations for operating capital generation, citing US business and raising its FY operating capital generation guidance. In Southern Europe, Tecnicas Reunidas (TRE.SM) and Assicurazioni Generali (G.IM) reported 9M earnings, with the latter releasing results mostly ahead of consensus, whilst, In France, Vallourec (VK.FP) issued Q3 earnings and confirmed its guidance for 2024.

  • In M&A, Volex (VLX.LN) announced cash and shares offer for TT Electronics (TTG.LN) valued at 139.6p per TT Electronics share.TT Electronics board unanimously rejected the cash and shares offer and said it had recently received and rejected an all-cash indicative proposal from another party at a significantly higher value than the Volex Proposal; there are no ongoing discussions with this party. Overnight, Halozyme (HALO) confirmed proposal to combine with Evotec (EVT.GR) for €11.00/sh in an all-cash transaction. BE Semiconductor Industries (BESI.NA) said it would not comment on market rumors post Betaville report of takeover interest and added it remained committed to execution of strategic plan as independent company.

  • Sovereign credit rating reviews due after the close include Fitch (Ireland), Moody's (Portugal) and S&P (Ireland)

  • Of note, the week ahead sees G20 leaders' summit, Bundesbank's latest monthly report, meeting of SNB and its watchers. Amidst notable macro releases for next week, Eurozone, France, Germany, UK Nov preliminary manufacturing/services PMIs, UK Oct inflation data, Eurozone Oct final CPI will be in focus.

• Digest:

  • Sectors - STOXX Europe 600:

    • Outperformers:

      • Basic Resources +1.19%, Oil & Gas+1.05%, Insurance +0.92%, Banks +0.66%, Travel & Leisure +0.34%, Utilities +0.31%, Personal Care Drug and Grocery Stores +0.04%, Retail (0.09%), Construct & Mtls (0.18%), Autos & Parts (0.19%), Telecom (0.20%), Chemicals (0.24%), Consumer Products and Services (0.38%), Financial Svcs (0.52%), Food, Beverage and Tobacco (0.69%)

    • Underperformers:

      • Media (3.03%), Health Care (2.90%), Technology (2.82%), Ind Goods & Svcs (0.88%)

  • Macro:

    • Economics:

      • European Commission anticipates a return to modest growth into 2025 in its Autumn 2024 Economic Forecast

      • ECB's Schnabel warns of downsides of QE and forward guidance (Bloomberg)

    • UK:

      • UK economy contracts 0.1% in September, missing expectations (Baha)

      • UK industrial production down by 0.5% in September, missing expectations (Baha)

      • BoE's bond portfolio tweak gives UK chancellor £10B budget boost (Bloomberg)

      • Chancellor Reeves encourages deregulation in financial sector (Guardian)

      • BoE Governor Bailey says poor jobs data a substantial problem (London Times)

      • Starmer seeks Xi meeting at G-20 summit in Rio de Janeiro (Bloomberg )

    • Germany:

      • CDU clarified position on debt brake reform following recent comments by leader Merz (FAZ)

      • Defence minister calls for increased military spending, even at cost of debt brake (Reuters)

      • Pressure mounts on unpopular Scholz as German election looms (Reuters)

      • German economy to underperform euro zone until 2026, EU forecasts (Reuters )

    • France:

      • Le Pen allies decry witch-hunt as prosecutors threaten her French presidential hopes (Reuters )

  • Peripheral markets:

    • Cyprus:

      • Energy giants from Gulf states interested in Cypriot natural gas (CyprusMail )

    • Italy:

      • EC trims 2024 growth forecast for Italy to 0.7% (ANSA )

      • Italy, Germany most exposed to US tariffs, says European Economy Commissioner Paolo Gentiloni (ANSA )

    • Norway:

      • Government will introduce a disclosure obligation for everyone who stores or exchanges crypto-assets in Norway - release

    • Poland:

      • Pledges to cut red tape in bid to lure IPOs back from Luxembourg (Bloomberg )

    • Sweden:

      • Sells State owned car testing business, Bilprovning, to TÜV Rheinland for SEK1.2B - release

  • Company news:

    • Notable Gainers

      • +41.8% TTG.LN (TT Electronics £1.12, +0.33) -- rejects Volex cash and shares offer at 139.6p

      • +23.2% PREC.SS (Precise Biometrics SEK3.59, +0.68) -- earnings

      • +20.0% EVT.GR (Evotec €10.36, +1.73) -- Halozyme (HALO) confirms proposal to combine with Evotec for €11.00/sh

      • +19.1% PARRO.FP (Parrot €2.34, +0.38) -- sales

      • +15.0% AGL.LN (ANGLE £0.12, +0.02) -- AACR posters

      • +14.2% TOKMAN.FH (Tokmanni Group €11.48, +1.43) -- earnings

      • +6.0% MPE.LN (M.P. Evans Group £9.86, +0.56) -- raises FY guidance

      • +4.9% G.IM (Assicurazioni Generali €27.08, +1.27) -- earnings

      • +4.7% BWE.NO (BW Energy NOK23.55, +1.05) -- earnings

      • +4.5% LAND.LN (Land Securities Group £6.06, +0.26) -- earnings

      • +4.4% GARO.SS (GARO SEK20.40, +0.86) -- earnings; new management

      • +3.4% NEXN.LN (Nexxen International £3.02, +0.10) -- earnings

      • +3.0% SOLG.LN (SolGold £0.08, -0.00) -- earnings

      • +2.8% ANA.SM (Acciona €116.40, +3.20) -- trading update

      • +2.8% ANE.SM (Corporación Acciona Energías Renovables €19.54, +0.53) -- trading update

      • +2.7% COL.SM (Inmobiliaria Colonial SOCIMI €5.54, +0.15) -- earnings; Alantra Equities upgrade

      • +2.5% PEN.NO (Panoro Energy NOK28.40, +0.70) -- operational update

  • Notable Decliners

    • -35.3% SOLI.LN (Solid State £1.38, -0.75) -- trading update

    • -17.4% BAVA.DC (Bavarian Nordic A/S DKK169.10, -35.70) -- earnings

    • -14.3% STSU.NO (Standard Supply NOK30.00, -5.00) -- earnings

    • -12.0% BWO.NO (BW Offshore NOK27.10, -3.70) -- earnings

    • -10.3% VLX.LN (Volex £3.08, -0.36) -- cash and shares offer for TT Electronics (TTG.LN); earnings

    • -10.1% SGG.SS (Sensys Gatso Group SEK55.40, -6.20) -- earnings

    • -8.9% MARR.IM (Marr €9.62, -0.94) -- earnings; Mediobanca downgrade

    • -8.0% KDEV.SS (Karolinska Development SEK1.01, -0.09) -- earnings

    • -7.2% CGCBV.FH (Cargotec €53.85, -4.19) -- sells MacGregor business; name change, new CEO

    • -6.4% PAX.SS (Paxman SEK64.60, -4.40) -- earnings

    • -6.1% MATAS.DC (Matas DKK122.20, -8.00) -- earnings

    • -5.9% ABVX.FP (Abivax €8.84, -0.55) -- earnings

    • -5.1% NORVA.SS (Norva24 Group AB SEK28.80, -1.55) -- earnings

    • -5.0% ETH.IM (Eurotech SpA €0.77, -0.04) -- earnings

    • -4.4% NEX.FP (Nexans €112.10, -5.10) -- Bpifrance sells 1.1M shares (2.5% stake) in Nexans for €125M

    • -4.4% RBT.FP (Robertet €879.00, -40.00) -- holder placing

    • -3.8% STLN.SW (Swiss Steel Holding CHF2.30, -0.09) -- implements planned capacity adjustments

    • -3.5% WBD.IM (Webuild €2.62, -0.09) -- earnings

    • -3.2% IMP.A.SS (Implantica SEK41.75, -1.40) -- earnings

• EU companies reporting Monday 18-Nov:

  • Earnings:

    • Nordics: SalMar (SALM.NO), Nanoform Finland (NANOFH.FH)

    • Southern Europe: Solaria Energia (SLR.SM)

    • UK: Big Yellow Group (BYG.LN), Polar Capital Holdings (POLR.LN), Sirius Real Estate Ltd. (SRE.LN)

  • Trading Update: thyssenkrupp nucera (NCH2.GR), Freelance.com (ALFRE.FP)

  • Traffic: Aeroports de Paris ADP (ADP.FP)

  • CMD/events: Rheinmetall (RHM.GR), DKSH Holding (DKSH.SW), Vivendi (VIV.FP) Canal+, webcast on Canal+ web site, Daimler Buses (DTG.GR) eMobility Days

Data:

• Economics:

  • UK Sep

    • Visible Trade Balance (£16.32B) vs cons (£16.2B) and prior revised (£15.21B) from (£15.06B)

      • Trade Balance (£3.46B) vs cons (£0.4B) and prior (£0.96B)

    • Industrial Production (1.8%) y/y vs cons (1.2%) and prior revised (1.7%) from (1.6%); (0.5%) m/m vs cons +0.1% and prior +0.5%

    • Manufacturing Production (0.7%) y/y vs cons +0.1% and prior (0.3%); (1.0%) m/m vs cons 0.0% and prior revised +1.3% from +1.1%

    • Construction Output (0.4%) y/y vs cons (0.5%) and prior revised +0.5% from +0.3%; +0.1% m/m vs cons +0.3% and prior revised +0.6% from +0.4%

  • UK Q3 Prelim GDP +1.0% y/y vs cons +1.0% and prior +0.7%; +0.1% q/q vs cons +0.2% and prior +0.5%

  • France Oct CPI +1.2% m/m vs prelim +1.2%; +0.3% m/m vs prelim +0.2%

    • EU Harmonised: +1.6% y/y vs prelim +1.5%; +0.3% m/m vs prelim +0.3%

  • Italy Oct CPI +0.9% y/y vs prelim +0.9%; Italy Oct CPI 0.0% m/m vs prelim 0.0%

    • EU Harmonised: +1.0% y/y vs prelim +1.0%; +0.3% m/m vs prelim +0.3%

  • Italy Sep Trade Balance €2.58B vs cons €2.55B and prior revised €1.34B from €1.43B

  • Switzerland Oct PPI (1.8%) y/y vs cons (1.4%) and prior (1.3%); (0.3%) m/m vs cons +0.1% and prior (0.1%)

  • Norway Oct Trade Balance NOK63.7B vs cons NOK44.0B and prior revised NOK41.7B from NOK42.8B

  • Sweden Oct Unemployment Rate 7.8% vs cons 8.3% and prior 8.2%

• Markets:

  • WTI Crude (Dec 24): ($0.54) or (0.79%) to $68.16

  • €-$ +0.0014 or +0.13% to 1.0545

  • £-$ (0.0047) or (0.37%) to 1.2620

  • €-£ +0.0045 to 0.8358

  • S&P 500 (1.25%)

  • Performance year-to-date:

    • FTSE: 100 +4.3%

    • DAX: +14.7%

    • CAC: (3.6%)

    • Stoxx 600: +5.0%

    • MIB: +13.5%