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StreetAccount Summary - EU Market Recap: FTSE 100 (0.17%) to 8085.07, DAX (0.29%) to 19004.78, CAC40 (0.43%) to 7198.45, STOXX 600 (0.02%) to 500.49

Nov 20 ,2024

• Synopsis:

  • European equity markets finished lower, off worst levels. Basic resources, financial services, telecom and healthcare the best performers, while real estate, autos/parts, chemicals and retail main laggards. US equities lower in Wednesday midday trading. Treasuries weaker across the curve. Bund 1 bp firmer. Biggest move in Gilts after UK data. Dollar index up 0.6%. Gold up 0.8%. Bitcoin futures up 2.5%. WTI crude up 0.1%, off best levels.

  • Geopolitical tensions once more impacting sentiment into NY as Ukraine fired Storm-Shadow long-range missiles into Russia. Follows reports Wednesday that Putin willing to discuss ceasefire in Ukraine with president-elect Trump but demands Ukraine abandon NATO ambitions and make no significant territorial concessions. Attention also on German politics with senior figures from SPD meeting on Tuesday evening to discuss the possible replacement of Scholz with a new candidate for chancellor ahead of the February snap election. Defense Minister Pistorius the most popular member of the SPD. Survey by EY shows France at risk of losing foreign investment due to political instability. Think tank Resolution Foundation said in a report UK statistics office (ONS) may be underestimating number of people in work by almost one million.

  • Macro calendar in Europe focuses on UK inflation. Headline inflation, core reading and services prices firmer than forecast. Underlying inflation still seen as too high by policymakers to warrant a more active pace of easing. Reinforces likely of unchanged policy now until February. BoE policymaker told lawmakers on Tuesday labor market developments key to outlook and pointed out services prices still too high. BoE's Taylor endorsed market expectations for four rate cuts next year. Eurozone negotiated wages surged 5.4% y/y in Q3, marking highest increase since euro's inception, but analysts see little relevance for ECB policy.

  • In corporate news, DACHs names kicked off the session with SGS (SGSN.SW) and dormakaba Holding (DOKA.SW) issuing presentations ahead of their CMD and confirming guidance. Baloise (BALN.SW) reported 9M business volume numbers and EFG International (EFGN.SW) released a 10M business update. In France, STMicroelectronics (STMPA.FP) reiterated its $20B+ revenue ambition by 2030 in connection with its CMD and introduced the 2027-2028 intermediate model, whilst Elior Group (ELIOR.FP) reported FY earnings. In the UK, Britvic (BVIC.LN), Sage Group (SGE.LN), CVS Group (CVSG.LN), Severn Trent (SVT.LN) and Ninety One Plc (N91.LN) are amongst some of the companies in the region to update investors with their latest numbers.

  • In M&A, Symrise (SY1.GR) offers to acquire Probi (PROB.SS) for SEK350/sh in cash; Probi's independent bid committee will now evaluate the offer. Dunelm Group (DNLM.LN) acquires Homefocus Group; terms undisclosed. UK's CMA refers Boparan (via 2 Agriculture) / ForFarmers (Burston and Radstock feed mills) (FFARM.NA) JV for a phase 2 investigation. Bloomberg reported Rubis (RUI.FP) is exploring a potential sale, whilst Grifols (GRF.SM) said its board would not recommend shareholders accept the potential offer by Brookfield (BAM) at the indicated price.

• Digest:

  • Sectors - STOXX Europe 600:

    • Outperformers:

      • Basic Resources +0.65%, Financial Svcs +0.48%, Health Care +0.43%, Telecom +0.23%, Personal Care Drug and Grocery Stores +0.19%, Food, Beverage and Tobacco +0.18%, Insurance +0.13%, Construct & Mtls +0.08%

    • Underperformers:

      • Autos & Parts (1.28%), Real Estate (0.73%), Chemicals (0.48%), Retail (0.45%), Travel & Leisure (0.38%), Ind Goods & Svcs (0.38%), Consumer Products and Services (0.36%), Utilities (0.26%), Media (0.15%), Banks (0.06%), Technology (0.05%)

  • Macro:

    • ECB:

      • ECB's financial stability review warns over impact from trade tensions (Bloomberg)

    • Economy:

      • Surprising uptick in Eurozone Q3 negotiated wages dismissed as backward-looking (Bloomberg, Reuters)

    • UK:

      • UK inflation jumped last month in part due to rising energy prices, official figures show (BBC, FT)

      • Think tank Resolution Foundation said in a report UK statistics office (ONS) may be underestimating number of people in work by almost one million (London Times)

      • UK farmers protest inheritance tax changes amidst growing economic strain (Bloomberg)

    • Germany:

      • Debate heating up within SPD as to whether Scholz is still the right candidate for chancellor (Reuters)

      • German wage growth hits 30-years high despite economic stagnation (Bloomberg)

      • German producer prices down by 1.1% in October (Baha)

      • Germany expected to face challenging start to 2025 (Handelsblatt, Welt)

      • Ford Motor (F ) to reduce its European workforce by 4,000 positions, primarily in Germany and the UK

    • France:

      • Survey shows France risks losing investment due to political instability (London Times)

      • Jordan Bardella branded 'Brutus' over apparent dig at Le Pen's trial (Telegraph )

    • Geopolitics:

      • Putin open to ceasefire talks with Trump, demands Ukraine abandon NATO aspirations (Reuters)

      • Biden approves anti-personnel landmines for Ukraine in further policy turnaround (Guardian, WP)

      • Macron urges Putin to de-escalate nuclear threats amid rising tensions at G-20 (Politico)

      • Denmark makes new $138M donation to Ukraine's military (Reuters)

  • Peripheral markets:

    • Italy:

      • Italian banking statistics show resilience in October (ABI statistics)

    • Spain:

      • Spain's deadly floods could shave 0.2% off 2024 economic growth (Bloomberg)

    • Greece:

      • New budget includes support measures over €1B (Kathimerini )

      • Government reopens 10-year bond to tap €250M (Kathimerini )

      • General strike brings thousands onto streets, halts shipping, transport (Reuters , Kathimerini )

    • Ireland:

      • Ireland's election: the parties, the voting, the issues and the likely result (Guardian )

  • Company news:

    • Notable Gainers

      • +42.3% PROB.SS (Probi SEK350.00, +104.00) -- Symrise (SY1.GR) offers to acquire Probi for SEK350/sh in cash

      • +18.0% SGE.LN (Sage Group £12.71, +1.94) -- FY underlying EPS 37.9p vs consensus 36.5p; hikes divi by 6% and guides FY25

      • +10.6% SYNACT.SS (SynAct Pharma SEK9.01, +0.86) -- capital raise

      • +8.9% FRP.LN (FRP Advisory Group £1.60, +0.13) -- trading update

      • +5.1% IBAB.BB (Ion Beam Applications €13.10, +0.64) -- contract

      • +4.2% ONCO.SS (Oncopeptides SEK1.49, +0.06) -- to present data on PDC platform efficacy in Acute Myeloid Leukemia at the American Society of Hematology meeting

      • +2.5% EDEN.FP (Edenred €29.34, +0.72) -- increases share buyback mandate by €39M; upgraded to hold from underperform at Jefferies

      • +2.3% KGH.LN (Knights Group Holdings £1.10, +0.03) -- trading update

      • +2.0% ISOFOL.SS (Isofol Medical SEK3.30, +0.06) -- operational update

      • +1.6% AVTX.NA (Avantium €2.20, +0.04) -- parternship collaboration

      • +1.5% GIMB.BB (Gimv €37.25, +0.55) -- sells majority stake in outpatient rehabilitation specialist rehaneo to Fremman Capital

      • +1.4% NOKIA.FH (Nokia €4.02, +0.05) -- multi-year, multi-billion extension deal from Bharti Airtel (532454.IN)

      • +1.4% NANO.LN (Nanoco Group £0.11, -0.00) -- FY EPS (0.4p) vs FactSet 0.0p [2 est, (0.4)-0.3p]; to review options for the group's trading business, IP and other assets, including potential for a sale of these assets

      • +1.2% CVSG.LN (CVS Group £8.31, +0.10) -- AGM Statement/Trading Update; says trading in line with expectations; continues to expect to deliver FY25 results in line with market expectations

      • +1.2% GRF.SM (Grifols €10.47, +0.13) -- announces board would not recommend shareholders accept potential offer by Brookfield at indicated price

      • +1.2% SVT.LN (Severn Trent £27.22, +0.33) -- H1 EPS 58.0p vs FactSet 51.2p

      • +1.0% HILS.LN (Hill & Smith £21.00, +0.20) -- trading statement: revenue for 4M to 31-Oct +7.5% y/y on constant currency basis

    • Notable Decliners

      • -60.0% PPS.LN (Proton Motor Power Systems £0.00, -0.00) -- to continue with orderly wind down

      • -25.0% ELIOR.FP (Elior Group €3.09, -1.03) -- FY EBITA €167M ex-items vs consensus €158.4M

      • -15.2% CHH.LN (Churchill China £7.00, -1.25) -- trading update

      • -14.8% ALATI.FP (Actia Group €2.77, -0.48) -- sales

      • -11.3% TRCS.LN (Tracsis £5.90, -0.75) -- earnings

      • -10.8% RNO.LN (Renold £0.48, -0.06) -- earnings

      • -7.0% VOW.NO (Vow ASA NOK2.93, -0.22) -- rights issue

      • -5.8% SEAPT.NO (Seacrest Petroleo Bermuda NOK0.20, -0.01) -- earnings

      • -5.7% TOBII.SS (Tobii SEK1.82, -0.11) -- divests some imaging assets acquired from FotoNation

      • -5.5% VTY.LN (Vistry Group £6.34, -0.37) -- management change

      • -5.5% HTWS.LN (Helios Towers £0.96, -0.06) -- placing

      • -4.8% ARB.LN (Argo Blockchain £0.08, -0.00) -- Q3 net income ($6.3M) vs FactSet ($7.2M) [2 est, ($8.1)-(6.2M)]

      • -4.4% FDJ.FP (La Francaise des Jeux €37.60, -1.74) -- Crédit Agricole Assurances sale of 4.1M shares

      • -3.7% EBUS.NA (Ebusco Holding €1.25, -0.05) -- rights issue

      • -3.3% MGN.NO (Magnora NOK23.75, -0.80) -- Hafslund Vekst AS executed 4.5M block sale of existing shares in Magnora ASA through club deal

      • -3.3% CO.FP (Casino Guichard-Perrachon €1.32, -0.04) -- notes share purchase agreement by which Trinity Investments Designated Activity Company is to transfer to EP Equity Investment III its 7.65% shareholding in France Retail Holdings

      • -3.2% EQLS.LN (Equals Group £1.20, -0.04) -- announces extension of PUSU deadline to 11-Dec from 20-Nov

      • -3.1% N91.LN (Ninety One Plc £1.57, -0.05) -- Sanlam and Ninety One enter into binding Framework Agreement (FWA); conf call at 9:00 UK time

      • -2.9% TLGO.SM (Talgo €3.34, -0.10) -- 9M net income €6.7M vs FactSet €8.4M

      • -2.9% SCT.LN (Softcat £15.90, -0.47) -- Trading Update: performed well during Q1, delivering further growth in gross profit and operating profit

      • -2.8% SINCH.SS (Sinch SEK19.85, -0.57) -- announces new financial targets: by end of 2027, targets to reach Organic growth in net sales and gross profit of +7-9% y/y

      • -2.4% HICL.LN (HICL Infrastructure £1.21, -0.03) -- H1 NAVPS 156.5p vs year-ago 158.2p

      • -2.2% KTCG.AV (Kapsch TrafficCom €7.00, -0.16) -- earnings

      • -1.8% FFARM.NA (ForFarmers €3.27, -0.06) -- UK's CMA refers Boparan (via 2 Agriculture) / ForFarmers (Burston and Radstock feed mills) JV for a phase 2 investigation

      • -1.6% PEN.NO (Panoro Energy NOK27.95, -0.45) -- earnings

      • -1.5% BLND.LN (British Land Co. £3.79, -0.06) -- H1 EPRA NTAPS 567.0p vs year-ago 562.0p; now expects FY25 Underlying EPS 28.1p vs prior 27.9 and FactSet 28.3p

      • -1.5% BORR.NO (Borr Drilling NOK43.24, -0.68) -- temporary suspension of operation for rig in Saudi Arabia

      • -1.3% PNOR.NO (Petronor E&P NOK10.56, -0.14) -- earnings

      • -1.3% ENQ.LN (EnQuest £0.12, -0.00) -- expects FY production to be slightly below 41-45 Kboepd guidance range

      • -1.3% EFGN.SW (EFG International CHF11.72, -0.16) -- 10-months business update: net new assets CHF 7.4B, corresponding to annualised growth rate of 6.3%

      • -1.1% OKDBV.FH (Oriola €0.94, -0.01) -- Swedish Competition Authority rejects Apotekstjänst Sverige AB's appeal regarding Oriola's sale of Svensk dos AB to Apotekstjänst Sverige AB

      • -1.0% STMPA.FP (STMicroelectronics €23.00, -0.23) -- reiterates $20B+ revenue ambition by 2030; introduces 2027-2028 intermediate model -- CMD

  • EU companies reporting tomorrow:

    • Earnings:

      • Benelux: Gimv (GIMB.BB), Ion Beam Applications (IBAB.BB)

      • DACHs: UNIQA Insurance Group (UQA.AV), PORR (POS.AV), Schoeller-Bleckmann Oilfield Equipment (SBO.AV), Marinomed Biotech (MARI.AV), CTS Eventim (EVD.GR), Nabaltec (NTG.GR), MPH Health Care (93M1.GR), DFV Deutsche Familienversicherung (DFV.GR), NFON (NFN.GR), DATAGROUP (D6H.GR), IVU Traffic Technologies (IVU.GR), USU Software (OSP2.GR)

      • Nordics: Subsea 7 (SUBC.NO), Scandinavian Enviro Systems (SES.SS), Malmbergs Elektriska (MEAB.B.SS), Abliva (ABLI.SS)

      • Southern Europe: Altri (ALTR.PL),

      • UK: Halma (HLMA.LN), Investec (INVP.LN), Jet2 (JET2.LN), Britvic (BVIC.LN), Grainger (GRI.LN), MITIE Group (MTO.LN), Ithaca Energy (ITH.LN), CMC Markets (CMCX.LN), XPS Pensions Group (XPS.LN), Liontrust Asset Management (LIO.LN), Norcros (NXR.LN), Speedy Hire (SDY.LN)

    • Trading Update: JD Sports Fashion (JD.LN), Breedon Group (BREE.LN), Ion Beam Applications (IBAB.BB), Inventiva (IVA.FP), Amplitude Surgical (AMPLI.FP)

    • CMD/events: Novartis (NOVN.SW) CEO Presentation & Breakout Sessions, Zurich Insurance Group (ZURN.SW), Bachem Holding (BANB.SW), Technip Energies (TE.FP), Breedon Group (BREE.LN), Alfa Laval (ALFA.SS), IGD SIIQ (IGD.IM)

• Data:

  • Economics:

    • UK Oct

      • CPI +2.3% y/y vs cons +2.2% and prior +1.7%; +0.6% m/m vs cons +0.5% and prior 0.0%

        • Core +3.3% y/y vs consensus +3.1% and prior +3.2%

      • Output PPI (0.8%) y/y vs cons (0.9%) and prior revised (0.6%) from (0.7%); 0.0% m/m vs cons (0.1%) and prior revised (0.4%) from (0.5%)

      • Input PPI (2.3%) y/y vs cons (2.5%) and prior revised (1.9%) from (2.3%); +0.1% m/m vs cons +0.6% and prior revised (0.5%) from (1.1%)

      • RPI +3.4% y/y vs cons +3.4% and prior +2.7%; +0.5% m/m vs cons +0.5% and prior (0.3%)

    • Germany Oct PPI (1.1%) y/y vs cons (1.1%) and prior (1.4%); +0.2% m/m vs cons +0.2% and prior (0.5%)

    • Eurozone Sep Construction Output (1.6%) y/y vs cons (1.0%) and prior (2.5%)

    • Denmark Q3 Prelim GDP +3.9% y/y vs cons+2.5% and prior +3.4%; +1.2% q/q vs cons +0.3% and prior revised +1.3% from +1.1%

  • Markets:

    • WTI Crude (Dec 24): +$0.15 or +0.22% to $69.54

    • €-$ (0.0082) or (0.77%) to 1.0514

    • £-$ (0.0046) or (0.36%) to 1.2635

    • €-£ (0.0033) to 0.8323

    • S&P 500 (0.64%)

    • Performance year-to-date

      • FTSE 100: +4.55%

      • DAX: +13.45%

      • CAC: (4.57%)

      • MIB: +9.48%

      • Stoxx 600: +4.49%