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Monday, 08 Feb 2016
07:05

We should see a little more USD retracement this week, with last week’s aggressive price action reflecting a wholesale shift in sentiment.  That the Fed rate hiking expectations were ‘overcooked’ is now clear to see, but the fall in the US unemployment rate to 4.9% along with better earnings numbers has stemmed the overly dovish tone.  No China this week, which will perhaps help stabilise the risk mood, which in turn will help USD/JPY and to a lesser extent the AUD.  EUR/USD looks to have settled into a near term range in the low 1.1100’s, but we see some further retrenchment here with the rest of the majors.  Cable is following closely in this respect, but with Oil looking soft again, the CAD is around 2.5 cents off better levels against the greenback.

Source: RANsquawk
Print
Monday, 08 Feb 2016
07:03

Air France KLM (AF FP) – Co’s passenger numbers are up 3% to 6.4mln in Jan. (BBG)

Amundi (AMUN FP) – Co. is talks to buy EUR 1.3bln of Gencia's (GFC FP) assets. (BBG)

Assa Abloy (ASSAB SS) – Q4 net sales SEK 18.3bln vs. Exp. SEK 17.9bln, Co. proposes dividend of SEK 2.65/shr, Co. sees weaker demand in many developing markets. (BBG)

Areva (AREVA FP) – Co’s CEO is set to discuss possible Gamesa (GAM SM) stake sale with the government. (Echos)

Bilfinger (GBF GY) – Co sells water technology business to Chengdu Techcent for EUR 200mln with the division employing 1.6k workers. (BBG)

BT (BT/A LN) – Co. confirms the process has started to find a new CFO but no decision has been taken as of yet. (BBG)

Ferrovial (FER SM) – Broadspectrum’s Allan Gray says he will not accept a bid from Ferrovial. (BBG)

Galp (GALP PL) – Q4 adjusted net EUR 149mln vs. Exp. EUR 113mln and adjusted EBITDA down 22.5%. (BBG)

Lonza (LONN VX) – ChemChina approached the Co. before making its bid for Syngenta, however Co.’s Chairman rejected their approach, according to reports in SoZ. (BBG)

Ocado (OCDO LN)Morrison’s (MRW LN) supermarket is attempting to loosen ties between the two companies, having so far declined to take up space in the Co.’s Erith distribution centre. However, some sources have noted this is an attempt by the retailer to squeeze a better deal out of the Co. (Telegraph)

Old Mutual (OLM LN) – Co. are set to sell Rogge, Rogge global has GBP 24.1bln of FUM as at December 31st. (BBG)

PEAB (PEABB SS) – Co. writes down SEK 800mln on mall project in Scandinavia. (BBG)

Randgold Resources (RRS LN) – FY production up 6% at a record 1.2mln oz, in line with guidance, as are costs. Co. have proposed a 10% increase in annual dividend. (BBG)

Swatch (UHR VX) – Co’s CEO says the timing of the repurchase program is ‘ideal’ and there is no reason to be optimistic about 2016. (FUW)

Volkswagen (VOW3 GY) – Co.’s trucks unit are in talks with peers over China expansion options, Co. is also set to combine Scania, Man assembly operations in Russia, Co. is also set to make axels for Man and Scania in Salzgitter factory. (BBG)

For earlier equity news please refer to the Daily European Equity Opening News on the headlines

Source: RANsquawk
Print
Monday, 08 Feb 2016
06:57

**EUROPEAN EQUITY COVERAGE WILL ONLY COVER COMPANIES WITH A MARKET CAP GREATER THAN GBP 2BLN OR EUR 2BLN**

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There will be an additional audio rundown at 0750GMT/0150CST recapping any company news which has hit the wires since 0715GMT/0115CST ahead of the European equity open

 

8th FEBRUARY 2016

 

ASIA

Asian equities began the week on the front-foot in holiday-thinned trade, despite the sell off on Wall Street after the latest mixed NFP release. As participants digested the US jobs report, the ASX 200 (-0.02%) and the Nikkei 225 (+1.1%) pared initial losses amid a turnaround in sentiment, while the latter had pulled off worst levels amid a softening JPY across the board. JGBs slipped amid spill over selling in USTs with yields rising across the curve, as such notable underperformance in the belly of the curve. As a reminder, markets in China are closed due to the Lunar New Year.

Best Performing Sectors in the Nikkei 225: Telecommunication (+2.26%) Industrials (+1.59%) Utilities (+1.57%)

Worst Performing Sectors in the Nikkei 225: Energy (-1.10%) Financials (+0.48%) Consumer Discretionary (+0.58%)

 

FTSE

HSBC (HSBA LN) – Co. have announced that they have reached a USD 470mln settlement agreement with the DOJ regarding allegations of foreclosure abuses. (BBG) In other reports, the Co. is expected to decide this week whether to keep its headquarters in Britain, with senior sources suggesting directors are leaning towards staying put. (Sunday Times)

Astrazeneca (AZN LN) – Co.’s Durvalumab and Tremelimumab when combined have shown promise against PD-1 negative tumors according to a study published over the weekend. (BBG)

GlaxoSmith­Kline (GSK LN) - Co. shareholders are yet to agree whether to accept the recent pressure by activist investor by splitting up the UK’s biggest drug maker and overhauling its board. Also of note, AXA Investments (CS FP) are among investors asking for Co. to acquire Pfizer’s and Shionogi’s majority stakes in HIV therapy company ViiV. (Telegraph/BBG)

Anglo American (AAL LN) - Co. is expected to cut further into costs and slim its sprawling range of products to focus on just three commodities — diamonds, platinum and copper. It may also say that it has begun the hunt for a successor to Rene Medori, the company’s long-serving finance director. (Sunday Times)

Glencore (GLEN LN) - Co. is set to unveil a deal to bring in at least USD 500mln as part of its frantic efforts to slash its debt. The Co. is in advanced talks on a “streaming” deal, under which it would hand future precious metal production from a mine in Chile to American gold specialist Franco-Nevada, in exchange for an upfront payment. The agreement could be unveiled as soon as this week. (Sunday Times)

BAE Systems (BA/ LN) - Co. said to have won several development contracts to develop railguns for US military. (Telegraph)

easyJet (EZJ LN) - The Telegraph writes that Co. shareholders rejected its founder's call for the dividend ratio to be lifted to 50% of post-tax profits. (Telegraph)

Rolls-Royce (RR/ LN) - Co. is set to issue its sixth profit downgrade in 2 years and announce that it is to slash to its dividend. (Telegraph)

British American Tobacco (BATS LN) - Co. could be investigated by the Department of Justice after being pushed by the US Congress for allegations of bribery of officials and politicians in Africa to undermine UN health campaigns and put rival cigarette-makers out of business. (Independent)

BG Group (BG/ LN) - The Co. stated that they are in “excellent” shape prior to their GBP 35bln takeover by Shell (RDSA LN) adding that they are increasing their production and lowering their costs during the downside seen in oil prices. (Sunday Express)

Next (NXT LN) – A U.S based Hedge Fund has taken a GBP 60mln bet against the Co., after it admitted its online advantage over its rivals may be dwindling. (Telegraph)


OTHER UK COMPANIES

Rexam (REX LN) – Three buyout firms are plotting GBP 1bln bids for the drink can plants being discarded as part of the Co.'s blockbuster takeover by American rival Ball (BLL). (Sunday Times)


Companies paying dividend:

FTSE 100: BT Group PLC (GBP 0.049)

FTSE 250: ITE Group PLC (GBP 0.054)

BROKER RECOMMENDATIONS (BBG/RTRS)

ASTRAZENECA (AZN LN) DOWNGRADED TO HOLD FROM BUY AT HSBC

INMARSAT (ISAT LN) DOWNGRADED TO UNDERWEIGHT FROM EQUALWEIGHT AT BARCLAYS

AMEC (AMFW LN) DOWNGRADED TO NEUTRAL FROM BUY AT NOMURA

WOOD GROUP (WG/ LN) DOWNGRADED TO SELL, ADDED TO CONVICTION SELL LIST: GOLDMAN

PETROFAC (PFC LN) DOWNGRADED TO NEUTRAL FROM BUY AT GOLDMAN

 

 

DAX

Volkswagen (VOW3 GY) – New Jersey Attorney General announced a lawsuit against the Co. alleging fraud in equipping and the marketing of diesel cars. The Co. is also set to offer a generous compensation package for around 600k customers the U.S. (BBG)

Siemens (SIE GY) – Co. intend 4-figure job cuts in its process industry and drive technology units in Germany, according to Handelsblatt. (BBG)

Bayer (BAYN GY) – Co. have rejected EPA request to voluntarily cancel Flubendiaminde registration, as Co. say the EPA overestimate the environmental risk. (BBG)

OTHER GERMAN COMPANIES

BROKER RECOMMENDATIONS (BBG/RTRS)

MUNICH RE (MUV2 GY) UPGRADED TO NEUTRAL FROM UNDERPERFORM AT CREDIT SUISSE

 

CAC

Peugeot (UG FP) – Co. will pay Iran USD 466mln in compensation after it quit the country once sanctions were in place. Of note, Co. is paying fine to re-enter Iranian market. (RTRS)

OTHER FRENCH COMPANIES

Groupe Casino (CO FP) - The Co. have reached a deal to offload their stake in Big C Supercenter in a deal valued at EUR 3.1bln to TCC Group. (WSJ)

BROKER RECOMMENDATIONS (BBG/RTRS)

TECHNIP (TEC FP) UPGRADED TO BUY FROM NEUTRAL AT GOLDMAN

EIFFAGE (FGR FP) RATED NEW OUTPERFORM AT MEDIOBANCA

 

PAN-EUROPE

Banca Monte Dei Paschi (BMPS IM) – Q4 net loss EUR 196.6mln vs. Exp. EUR 251mln, Q4 total revenue EUR 1.12bln vs. Exp. EUR 1.09bln, CET1 ratio 12% as of end December, Co. go on to say liquidity adequate after recent market turmoil. Co.’s CEO made comment aftermarket on Friday saying that the Co. are open to M&A options if interest should arise. CEO also went on to say the majority of outflows are from corporate and wholesale. Furthermore, Co. are considering options to speed up recovery, including the sale of bad loans. (BBG)

Aegon (AGN NA ) – Source reports aftermarket on Friday suggested that Rothesay are in dicussions to purchase Co’s 13bln annuity book. (Sky)

Intesa Sanpaolo (ISP IM) – Co.’s CEO made comments on Friday aftermarket saying that they are not currently looking at acquisitions abroad and are focused on the internal growth of the company. (BBG)

BROKER RECOMMENDATIONS (BBG/RTRS)

EUROPE OIL SERVICES SECTOR UPGRADED TO NEUTRAL AT GOLDMAN

AMADEUS (AMS SM) DOWNGRADED TO SELL FROM NEUTRAL AT CITI

TELECOM ITALIA (TIT IM) UPGRADED TO NEUTRAL FROM UNDERPERFORM AT MACQUARIE

ARCELORMITTAL (MT NA) DOWNGRADED TO SELL FROM REDUCE AT ALPHAVALUE

IBERDROLA (IBE SM) UPGRADED TO NEUTRAL FROM UNDERPERFORM AT MEDIOBANCA

TENARIS (TEN IM) UPGRADED TO BUY FROM NEUTRAL AT GOLDMAN

 

SMI

Credit Suisse (CSGN VX) – Co. intends to reduce bonuses for senior executives, according to SontagsZeitung. (BBG)

Syngenta (SYNN VX) – ChemChina does not plan to restructure the Co. for 5 years, according to reports in Swiss Press. (BBG)

OTHER SWISS COMPANIES

N/A

BROKER RECOMMENDATIONS (BBG/RTRS)

GIVAUDAN (GIVN VX) DOWNGRADED TO NEUTRAL FROM BUY AT GOLDMAN

 

SCANDINAVIA

Ericsson (ERICB SS) – Co. are in talks to buy Abengoa’s Abentel unit. (BBG)

BROKER RECOMMENDATIONS (BBG/RTRS)

NESTE (NESTE FH) DOWNGRADED TO EQUALWEIGHT FROM OVERWEIGHT AT BARCLAYS

SSAB (SSABA SS) DOWNGRADED TO REDUCE FROM ADD AT ALPHAVALUE

ORION OYJ (ORNBV FH) UPGRADED TO NEUTRAL FROM SELL AT GOLDMAN

NOKIAN RENKAAT (NRE1V FH) DOWNGRADED TO SELL FROM HOLD AT NORDEA

 

US

US equities sold-off throughout the US session in the wake of the latest NFP report. This came after a miss on the headline figure (151K vs. Exp. 190K), a two month net downward revision of 105K, however we did see Unemployment unexpectedly falling and strong Average Hourly Earnings. Furthermore, IT names underperformed with the FANG stocks suffering their worst intra-day loss since the August black Friday sell-off. This came as LinkedIn shares fell over 40% after reporting poor FY Adj. EPS guidance (USD 3.05-3.20 vs. Exp. USD 3.77) which caused several firms to turn negative in the IT sector. The DJIA finished down 1.29% at 16204.83, S&P 500 finished down 1.85% at 1880.02 and the NASDAQ-100 finished down 3.44% at 4024.77.47.

 

Best Performing Sectors in the S&P 500: Telecoms (+0.77%), Utilities (+0.29%), Consumer Staples (-0.13%)

Worst Performing Sectors in the S&P 500: IT (-3.35%), Consumer Discretionary (-3.19%), Energy (-2.04%)

 

 

 

 

Source: RANsquawk
Print
Monday, 08 Feb 2016
06:33

Asian equities began the week on the front-foot in holiday-thinned trade, despite the sell off on Wall Street after the latest mixed NFP release. As participants digested the US jobs report, the ASX 200 (-0.02%) and the Nikkei 225 (+1.1%) pared initial losses amid a turnaround in sentiment, while the latter had pulled off worst levels amid a softening JPY across the board. JGBs slipped amid spill over selling in USTs with yields rising across the curve, as such notable underperformance in the belly of the curve. As a reminder, markets in China are closed due to the Lunar New Year.

Source: BBG
Print
Monday, 08 Feb 2016
06:28
  • The Nikkei 225 benefitted from the broadly softer JPY with overnight trade relatively subdued given the Chinese Lunar New Year
  • The latest Chinese FX reserve data fell to its lowest level in more than 3-years; falling USD 99.5bln to USD 3.23trl vs. Exp. USD 3.21trl
  • Highlights include German Industrial Production and a speech from the Bank of Canada’s Deputy Lane

ASIA

Asian equities began the week on the front-foot in holiday-thinned trade, despite the sell off on Wall Street after the latest mixed NFP release . As participants digested the US jobs report, the ASX 200 (-0.02%) and the Nikkei 225 (+1.1%) pared initial losses amid a turnaround in sentiment, while the latter had pulled off worst levels amid a softening JPY across the board. JGBs slipped amid spill over selling in USTs with yields rising across the curve, as such notable underperformance in the belly of the curve. As a reminder, markets in China are closed due to the Lunar New Year.

China’s FX reserve fell to its lowest level in more than 3-years; falling USD 99.5bln to USD 3.23trl vs. Exp. USD 3.21trl. (WSJ)

PBoC reiterated in their Q4 monetary policy report that they will continue with a prudent monetary policy and seek implementation of targeted reserve ratio cut measure, while also stating that they will maintain the CNY at a level that is basically stable. (BBG)

EUROPE

According to the heads of the German and French central banks, the Eurozone needs to press on with structural reforms and deeper integration such as a Eurozone finance ministry. (RTRS)

Fitch affirms Austria at AA+; outlook stable and upgraded Ireland to A; outlook stable. (BBG)

UK

Analysts at Citi say that Britain’s EU poll was now “one of the biggest near-term global political uncertainties”. It puts the risks of a Brexit vote at 20%-30% and warned that “the effects of Brexit, if it happens, are likely to be large and painful in economic and political terms, both for the UK and the overall EU”. (Sunday Times)

FX

FX markets saw somewhat of a subdued session overnight, however weakness had been observed in the JPY across the board, as such USD/JPY reclaimed 117.00 to the upside . While the USD-index remained firm in Asian trade as participants continued to digest the latest US jobs figures, with FFR futures now pricing in a rate hike before the end of the year.

GEOPOLITICAL

North Korea on Sunday conducted a long-range rocket launch in order to place a satellite into space in breach of UN sanctions. The UN has strongly condemned these actions with the council stating that they will adopt a new sanctions resolution. (FT/BBG)

Yonhap stated South Korea fired warning shots at a North Korean patrol boat, after the boat intruded the Western sea border. (BBG)

COMMODITIES

WTI crude futures saw a mild reprieve overnight to break above USD 31/bbl, following reports of positive discussions between the Saudi and Venezuelan Oil Ministers. Gold prices fell over USD 7 shortly after the reopen of electronic trade amid touted profit taking having posted its best weekly gain since July’13, alongside paring of the near-term rate hike expectations from the Fed after the US jobs report.

Saudi Arabian Oil Minister Ali al-Naimi stated that he held successful discussions with his Venezuelan counterpart in regards to ways of cooperating in order to stabilise the oil market. (BBG)

According to a Platts report, China oil demand declined by 0.8% Y/Y. (BBG)

US

US treasuries sold off following the NFP release amid a bout of selling from dealers, hedge funds, real money and algorithms. This was due to the Unemployment and Average Hourly Earnings components bolstering Fed rate-hike expectations which caused steepening of the curve driven by real money flow. However treasuries turned around in sympathy with the continued sell-off in equities alongside speculative sellers squaring their short positions to finish in positive territory with T-note Mar’16 futures settling up 3 ticks at 130.11+. Overnight USTs trade lower by 3 ticks at 130.08+.

Source: RANsquawk
Print
Monday, 08 Feb 2016
06:05
Source: BBG
Print
Monday, 08 Feb 2016
06:01

- Q3 net JPY 23.2bln vs. Exp. JPY 25.9bln

Source: BBG
Print
Monday, 08 Feb 2016
05:54

Daily Economic Releases is a comprehensive one stop-shop for key economic data, central bank speakers, government bond auctions, expiries and holidays for the G7 and beyond. If you would like to upgrade your account to receive access to this report please contact us at admin@ransquawk.com.

Source: RANsquawk
Print
Monday, 08 Feb 2016
05:53

USD/JPY: 116.00 (210mln), 117.00 (250mln), 117.75 (200mln)

AUD/JPY: 82.00 (200mln), 83.25 (252mln)

EUR/USD: 1.1000 (640mln), 1.1100 (608mln), 1.1200 (475mln)

AUD/USD: 0.7000 (701mln), 0.7025 (357mln), 0.7050 (333mln), 0.7065 (728mln), 0.7175 (2.2bln)

GBP/USD: 1.4500 (344mln), 1.4600 (287mln), 1.4700 (518mln)

Source: RANsquawk/IFR
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Monday, 08 Feb 2016
05:13
Source: RANsquawk
Print
Monday, 08 Feb 2016
05:04
Source: BBG
Print
Monday, 08 Feb 2016
05:00
Reaction details: 05:02

- No immediate reaction seen in USD/JPY, trades 117.31 (+96 pips last).

Source: BBC
Print
Monday, 08 Feb 2016
05:00
Source: BBG
Print
Monday, 08 Feb 2016
04:37
Source: BBG
Print
Monday, 08 Feb 2016
04:35
Monday, 08 Feb 2016
04:30
Reaction details: 04:31

- No immediate reaction in USD/JPY, trades 117.22 (+41 pips) last.

Source: Tokyo Shoko Research Ltd.
Print
Monday, 08 Feb 2016
03:49
Source: RANsquawk
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Monday, 08 Feb 2016
03:41
Monday, 08 Feb 2016
03:24

Proctor & Gamble (PG IS)
- Co. Q2 net INR 1.46bln vs. Exp. INR 906.6mln. (BBG)

Sadbhav Infrastructure (SINP IS)
- Q3 Q/Q loss INR 1.01bln vs. Exp. INR 809.6mln loss. (BBG)

Jaiprakash (JPA IS)
- Brookfield said to make offer for Co.’s cement business. (TOI)

Aarti Industries (ARTO IS)
- Co. Q3 INR 607.2mln vs. Exp. INR 569mln. (BBG)

Ballarpur Industries (BILT IS)
- Co. Q3 loss INR 599.4mln vs. INR 506m loss. (BBG)

Claris Lifesciences (CLAR IS)
- Co. Q3 loss INR 688.7mln vs. INR 898.5mln profit. (BBG)

Divi’s Laboratories (DIVI IS)
- Co. Q3 net INR 2.47bln vs. Exp. INR 2.74bln. (BBG)

3M India (3M IN)
- Co. Q3 net INR 566.1mln vs. INR 166.5mln. (BBG)

Jet Airways(JETIN IS)
- Co. Q3 net climbs 7x to INR 4.67bln on oil costs. (BBG)

Mahindra & Mahindra (MM)
- Pinifarina sees finalization of the deal by H1 2016. (BBG)

Rallis India (RALI IS)
- Co. will increase holdings in Metahelix Life Sciences to 100%. (BBG)

Tata Power (TPWR IS)
- Q3 Y/Y net INR 244.6mln vs. Exp. INR 2.3bln (Prev. INR 1.98bln). (BBG)

Basic Metals
- India January steel production fell 1.7% to 7.95mln tons.
- India January steel consumption rose 2.8% to 6.98 mln tons.
- India January steel imports fell 8.7% Y/Y to 916,000 tons. (BBG) 

Other Stories
- RBI’s Governor Raghuram Rajan is set to hold talks on India’s liquidity issue with bankers. (BBG)

Broker Moves
- Tata Steel upgraded to hold at HSBC. (BBG)

Source: BBG
Print
Monday, 08 Feb 2016
03:04
Source: BBG
Print
Monday, 08 Feb 2016
02:41

Asian equities begin the week on the back-foot in holiday thinned trade, following the sell off on Wall Street after the latest mixed NFP release. The headline figure had come in heavily below expectations, however, a surprise fall in the unemployment rate (lowest since Feb’08) and better than expected wage growth provided enough to ensure that Fed can maintain its tightening bias, despite the recent market volatility. As such, the ASX 200 (-0.2%) and the Nikkei 225 (-0.2%) trade in negative territory with both bourses dragged lower by energy names, however the latter had pulled off worst levels amid a softening JPY across the board. As a reminder markets in China are closed due to the Lunar New Year.

FX markets has seen somewhat of subdued session, although the JPY had weakened across the board with USD/JPY reclaiming the 117.00 level. Elsewhere, gold prices fell over USD 7 shortly after the reopen of electronic trade amid touted profit taking having posted its best weekly gain since July’13, alongside paring of the near-term rate hike expectations from the Fed after the aforementioned US jobs report.

JGBs slipped amid spill over selling in USTs with yields rising across the curve, as such notable underperformance in the belly of the curve.

Source: RANsquawk
Print
Monday, 08 Feb 2016
01:49
Source: RANsquawk
Print
Monday, 08 Feb 2016
01:28
Monday, 08 Feb 2016
01:16
Analysis details: 01:19

- Tensions between South and North Korea have been rising as of late. This comes after reports on Sunday that North Korea conducted a long-range rocket launch in order to place a satellite into space in breach of UN sanctions. As such, South Korea said that they and the US would begin talks on deploying an advanced missile-defence system to South Korea to counter the ongoing threat of North Korea's weapons capabilities. 

Source: Yonhap
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Monday, 08 Feb 2016
01:11
Source: BBG
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