Jan 28 ,2025
Synopsis
European equity markets set to open higher whilst Asia stocks mostly lower Tuesday. Japan's Nikkei seeing another day of steep losses with the Topix outperforming. Elsewhere, fairly quiet with volumes notably lower. Nevertheless markets in Australia, New Zealand, and those in Southeast Asia still open trending lower. Hong Kong a few points higher as IT stocks rose again. Mainland China, South Korea, Taiwan, Indonesia all closed.
DeepSeek hype remains the big talking point after heightening scrutiny on US capex ramp and ROI, as well as US tech AI leadership, coming at a time of high valuations and concerns about concentration risk. Trump viewed development as a positive that should incentivize American tech firms to build AI models more cheaply. DeepSeek's breakthrough raised questions about effectiveness of China export curbs that could lead to tighter US restrictions, though no indication from Trump on Monday about possible response.
Addressing Republicans on Monday, President Trump flagged tariffs on chips, steel, aluminum and copper in near future. Later said starting rate on universal tariffs will be "much bigger" than 2.5% reportedly discussed by Treasury Secretary Bessent. Also repeated his threat to semiconductor and other companies to manufacture in US or face punitive tariffs. Trump tariff headlines have veered between benign and hawkish since his inauguration, but his remarks and recent press reports suggest momentum for tariff implementation is growing.
On today's agenda, regarding the German federal election, ZDF is due to host tv event where candidates separately answer questions posed by a live audience in a town hall format. In UK, parliamentary committee topics include new Economic Secretary to give Government view on cash acceptance ay 10:00GMT, energy grid and grid connections 10:30 and how sustainable is our national debt? 15:15. Reform UK leader Nigel Farage will host a fundraiser at a central London venue at which he reportedly intends to unveil new details of his "vision for the country". Also on Tue are EU General Affairs Council meeting and 17th European Space Conf (through Wed), EU's Kubilius (on Tue and panellist Wed) and Kadis (Wed) among the speakers as well as WELT Economic Summit (through Wed) and Nuremburg Toy Fair gets underway. Press conf. at 10:00CET by the Federal Financial Supervisory Authority (Bafin) title "Risks in the focus of Bafin 2025''. Artic Frontiers conf continues (Mon-Thu) in Norway, with country's PM Støre speaking at 8:30CET on Tue and 20:30 on Wed.
In central banks, Hungary's central bank is expected to leave its benchmark interest rate unchanged when it announces its decision at 14:00CET. Bank of France hosts conf 'T2, T1, T0: Go! The future of financial markets and their infrastructures: What's ahead?', Governor Villeroy opening remarks at 10:30CET, ECB's Cipollone panellist at 15:30. BOE's Jackson speech at 14:30GMT at UK Finance 'prime brokerage' and Bundesbank's Theurer speech at 17:00CET at one of the bank's regional offices. ECB's Lagarde, EU's von der Leyen informal diner and exchange of views at 18:00CET whilst ECB's latest bank lending survey published at 10:00CET.
European macro data releases out today include, France Jan consumer confidence, Spain Q4 unemployment rate, Norway Dec retail sales, Ireland Q4 preliminary GDP, Portugal Dec retail sales, UK Jan shop price index - BRC
In earnings news, out of the DACHs region, Sartorius (SRT3.GR), SAP (SAP.GR) and Wacker Chemie (WCH.GR) reported Q4/FY numbers, whilst Siemens Energy (ENR.GR) issued preliminary results for Q1 of FY25 and indicated that it will exceed the current FCF pretax guidance for FY25 and will update it with the half-year results for FY25. Also of note, Mercedes Benz (MBG.GR) held a pre-close call last night where it indicated Q4 Cars margins likely to come in slightly above 6-7% previously guided. In France, Alten (ATE.FP), ID Logistics Group (IDL.FP) and Sartorius Stedim Biotech (DIM.FP) reported preliminary FY earnings, with the latter issuing a cautious outlook for FY25 with profitable growth targeted. Also, due to the update, investors today include Logitech International (LOGN.SW), LVMH Moet Hennessy Louis Vuitton (MC.FP) and Atlas Copco (ATCO.A.SS).
In M&A, ING (INGA.NA) announced that it has reached an agreement on the sale of its business in Russia to Global Development JSC. The company expects a negative P&L impact of around €0.7B post-tax. Elsewhere, Reuters reported that KKR & Co. and Enel (ENEL.IM) are listed as potential bidders for Cubico Sustainable Investments. The report indicates Cubico could be valued at ~$6B+.
Politics/Macro/World News
Swiss National Bank will not lightly take interest rates negative, chairman says - Reuters
German leftist leader vows to block higher defence spending - FT
UK Food Prices Rise Most in Nine Months Ahead of BOE Meeting - Bloomberg
French Bonds Find Buyers as Budget Deal Removes a Fiscal Hurdle - Bloomberg
Top company news
Earnings/updates
Germany
SAP.GR (SAP) -- reports Q4 non-IFRS EPS €1.40 vs FactSet €1.34 [19 est, €1.18-1.47]
SRT3.GR (Sartorius) -- reports FY EPS €4.05 vs FactSet €3.89 [23 est, €1.50-4.56]; cautiously positive outlook for 2025 with profitable growth expected in both divisions
ENR.GR (Siemens Energy) -- AG announces preliminary results for Q1 of FY25; to exceed the current FCF pretax guidance for FY25
WCH.GR (Wacker Chemie) -- reports prelim FY net income €265M vs FactSet €212.9M [16 est, €127.9-273.8M]
COTN.SW (COMET Holding) -- reports preliminary FY revenue CHF445M vs FactSet CHF437.4M [9 est, CHF430.3-443.2M]
EUZ.GR (Eckert & Ziegler Strahlen- und Medizintechnik) -- reports preliminary FY adjusted EBIT ~€66M vs FactSet €60.4M [1 est]
WEW.GR (Westwing Group) -- SE provides trading update; expects FY 2024 revenue and adjusted EBITDA at the upper end of guidance
France
AIR.FP (Airbus SE) -- Airbus Helicopters logs 455 gross orders (net: 450) in 2024
ATE.FP (Alten) -- reports preliminary FY revenue €4.14B vs FactSet €4.12B [8 est, €4.08-4.14B]
IDL.FP (ID Logistics Group) -- reports prelim FY revenue +19.1% (+17.2% like-for-like) to €3.27B vs FactSet €3.22B [4 est, €3.21-3.24B]
DIM.FP (Sartorius Stedim Biotech) -- reports preliminary FY Underlying EPS €3.49 vs FactSet €3.33 [14 est, €2.84-3.67]; deliberately cautious outlook for FY25 with profitable growth targeted
GET.FP (Getlink) -- reports preliminary Q4 revenue €331M vs FactSet €304M [1 est]
Nordics
VAR.NO (Vår Energ) --i reports preliminary FY production 280 kboepd vs guidance 280-290 kboepd
HMS.SS (HMS Networks) -- reports Q4 adj EPS SEK2.60 vs FactSet SEK1.28 [5 est, (SEK0.30)-2.30]; oder intake and sales expect to improve during H2 of 2025
XVIVO.SS (Xvivo Perfusion) -- reports Q4 EPS SEK1.16 vs FactSet SEK1.38 [5 est, SEK0.70-3.62]
NETC.DC (Netcompany Group) -- reports Q4 EPS DKK2.45 vs FactSet DKK3.52 [8 est, DKK3.20-4.10]; defers mid-term revenue target to 2027, reaffirms adj. EBITDA margin target
Benelux
NSI.NA (NSI NV) -- reports preliminary FY EPRA EPS €2.09 vs year-ago €2.01
Also due to report today:
Earnings:
DACH: Logitech International (LOGN.SW)
Finland: Saga Furs (SAGCV.FH)
France: LVMH Moet Hennessy Louis Vuitton (MC.FP), Groupe Partouche (PARP.FP)
Sweden: Atlas Copco (ATCO.A.SS), Nordnet (SAVE.SS), Getinge (GETI.B.SS), HEXPOL (HPOL.B.SS), Probi (PROB.SS), Elanders (ELAN.B.SS), Micro Systemation (MSAB.B.SS), BE Group (BEGR.SS),
UK: SThree (STEM.LN), Idox (IDOX.LN)
Trading Update: Computacenter (CCC.LN), Synthomer (SYNT.LN), Pets At Home Group (PETS.LN), A.G. BARR (BAG.LN), Compagnie des Alpes (CDA.FP), Aramis (ARAMI.FP), EXEL Industries (EXE.FP), Figeac Aero (FGA.FP), Safilo (SFL.IM)
CMD/events: BMW (BMW.GR) pre-close conf call
M&A
KKR (KKR & Co.) -- and Enel (ENEL.IM) listed as potential bidders for Cubico Sustainable Investments - Reuters
A5G.ID (AIB Group) -- Irish Minister for Finance announces Irish State's intention to sell ~5% sake in AIB Group
MC.FP (LVMH Moet Hennessy Louis Vuitton) -- Stella McCartney repurchasing minority stake held by LVMH; terms undisclosed - Reuters
MBTN.SW (Meyer Burger Technology) -- sells Pasan, terms and buyer undisclosed
JUVE.IM (Juventus Football Club) -- Juventus Football Club announces agreement with Chelsea for acquisition of Renato Veiga
CIBUS.SS (Cibus Nordic Real Estate) -- completes acquisition of Forum Estates; resolves on share issue as consideration for acquisition
AWDR.NO (Awilco Drilling) -- announces cancellation of share premium account completed
FRU.MIL.IM (Multitude) -- Follow-up: Multitude announces leadership changes; organizational restructuring
542772.IN (360 One Wam) -- UBS in advanced talks regarding transaction with 360 One Wam - Bloomberg
Healthcare
ROG.SW (Roche Holding) -- Roche's Phase III INAVO120 study met its key secondary endpoint, showing a statistically significant and clinically meaningful OS benefit with the Itovebi-based regimen compared with palbociclib and fulvestrant alone.
4568.JP (Daiichi Sankyo) -- FDA approves Daiichi Sankyo, AstraZeneca's ENHERTU as first HER2-directed therapy for patients with HER2 low or HER2 Ultralow metastatic breast cancer
Other
AVOL.SW (Avolta) -- wins contract to operate ten food and beverage outlets across Norway's Oslo Gardermoen Airport
FNTN.GR (Freenet) -- announces appointment of Robin Andes as CEO; effective 1-Aug
A5G.ID (AIB Group) -- CORRECTION: Irish Minister for Finance announces Irish State's intention to sell ~5% sake in AIB Group
NDX1.GR (Nordex) -- announces leadership transition as CSO Patxi Landa takes on new role
OPM.FP (OPmobility) -- to cancel 1.5M shares representing 1.03% of the share capital
Willis Lease Finance and TUI Airways announces long-term base maintenance partnership
Key rating changes
Upgrades
(NULL) -- Jefferies transfers ADEN.SW, HAS.LN, PAGE.LN, and RAND.NA
(NULL) -- Oddo upgrades SZG.GR, VOE.AV; downgrades OUT1V.FH
KESKOB.FH (Kesko) -- to buy from hold at Danske Bank
TIT.IM (Telecom Italia) -- to buy from hold at Kepler Cheuvreux
VOE.AV (Voestalpine) -- to outperform from neutral at Oddo
SZG.GR (Salzgitter) -- to neutral from underperform at Oddo
Downgrades
AAL.LN (Anglo American) -- to market perform from outperform at Bernstein
OUT1V.FH (Outokumpu) -- to neutral from outperform at Oddo
Initiations
EXENS.FP (Exosens) -- buy at Stifel
ALHG.FP (Louis Hachette Group SA0 -- outperform at Oddo
Others
HAS.LN (Hays Plc) -- transferred buy at Jefferies
RAND.NA (Randstad) -- transferred buy at Jefferies
PAGE.LN (PageGroup) -- transferred hold at Jefferies
Adecco Group (ADEN.SW) -- transferred underperform at Jefferies
LUMI.SS (Lundin Mining) -- resumed equal-weight at Morgan Stanley
Data
Nikkei (1.39%) to 39016.87
Hang Seng +0.14% to 20225.11
Shanghai Composite +0.00% to 3250.60
S&P futures (7.5) vs prior close of 6046.8
€-$ (0.0055) or (0.52%) to 1.0438
$-¥ +1.30 or +0.84% to 155.81
€-¥ +0.51 or +0.31% to 162.63
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