DAILY EUROPEAN EQUITIES OPENING NEWS: RWE (RWE GY) is looking at ways to cut its EUR 16.8bln stake in retail business Innogy (IGY GY), according to sources, adding this could involve a deal with Enel (ENEL IM).
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20th November 2017
Asia began the week subdued following the losses on Wall St. last Friday and with focus on political uncertainty after Trump campaigners were subpoenaed and German coalition talks broke down. ASX 200 (-0.2%) and Nikkei 225 (-0.5%) were in the red although recent strength across commodities helped stem losses in Australia, while Japanese sentiment was dampened by a firmer JPY and a miss on trade data. Hang Seng (-0.1%) and Shanghai Comp. (-0.7%) were negative with underperformance in the mainland as Shenzhen stocks resumed Friday’s sell off and amid reports that China tightened asset management rules to curb risky lending.
Rio Tinto (RIO LN) – Co. have hired advisers to explore potentially taking a stake in SQM, according to sources. (Newswires)
Glencore (GLEN LN) – Co. is reportedly mulling making a rival bid for WICET coal terminal. (The Australian)
Rolls Royce (RR/ LN) – Co. is seeking for buyers of its L’Orange business which could be valued at GBP 300mln. (Newswires)
Just Eat (JE/ LN) - A tax on takeaway boxes is to be considered in an attempt to tackle the problem of plastic waste. (BBC)
Legal & General (LGEN LN) – Co. could make a bolt-on acquisition in the US to replicate the Co.’s UK investment model. (FT)
UK Housing Names – House building is the number one priority in the budget and the power of the state will be used to force construction numbers up to 300,000 per year, the Chancellor has promised. (Telegraph)
UK Broadband Providers – A broadband company is working with 100 of Britain’s biggest property developers, including Barratt Development, Berkeley Homes and Crest Nicholson, to lay high-speed connections to newly built houses and flats. (Times)
UK Defence Names – Britain’s aerospace exporters will warn parliament today of a crippling GBP 1.5bln a year headwind if ministers fail to agree urgent new customs and regulatory deals with the EU. (Guardian)
OTHER UK COMPANIES
RBS (RBS LN) UPGRADED TO REDUCE FROM SELL AT ALPHAVALUE
AUTO TRADER (AUTO LN) INITIATED WITH A SECTOR PERFORM RATING AT RBC
Allianz (ALV GY) – Co. is well-protected against potential takeover attempts, according to CFO. (Newswires)
Deutsche Bank (DBK GY) - Germany's financial watchdog will take no action after ending an investigation into whether China's HNA and Qatar's royal family were working together on their investments in the Co., a person familiar with the matter said. (Newswires)
Deutsche Post (DPW GY) – Co. could face losses of up to EUR 100mln from paying service companies for the collection of letters that did not exist. (Newswires)
ProSiebenSat (PSM GY) - Chief Executive Thomas Ebeling will leave the German broadcaster next February, days after a profit warning and after Ebeling apologised for disparaging comments about the network's viewers. (Newswires)
RWE (RWE GY) – Co. is looking at ways to cut its EUR 16.8bln stake in retail business Innogy (IGY GY), according to sources, adding this could involve a deal with Enel (ENEL IM). (Newswires)
Siemens (SIE GY) – Co. workers might go on strike over thousands of job cuts the engineering conglomerate plans mostly in its gas turbine division, according to a leading labour representative. (Newswires)
OTHER GERMAN COMPANIES
RWE (RWE GY) UPGRADED TO CONVICTION BUY AT GOLDMAN SACHS
Natixis (KN FP) – Co. announces strategic plan for 2018-2020 in which It targets annual growth of 5% in net revenues. (Newswires)
OTHER FRENCH COMPANIES
JC Decaux (DEC FP) – Co.’s visit to Australia has triggered some speculation that the Co. are looking at M&A opportunities. (AFR)
VIVENDI (VIV FP) UPGRADED TO REDUCE FROM SELL AT ALPHAVALUE
Banca Monte dei Paschi (BMPS IM) – Co. said it had set aside EUR 569.4mln to pay for civil lawsuits as of end-September, after a group of bondholders this week challenged its state rescue. (Newswires)
Gas Natural (GAS SM) – Co. said it had agreed to sell the 59.1% stake it owns in its Colombian retail distribution unit to infrastructures fund Brookfield Infrastructure (BIP) for EUR 482mln. (Newswires)
Heineken (HEIA NA) – Co. has hired Key Capital Partners to find a buyer for its Beer & Food unit. (Newswires)
Julius Baer (BAER SW) – Co. AUM rose by 17% to a record CHF 393bln. (Newswires)
Novartis (NOVN SW) – Co.’s Tasigna drug has received EU approval. (Newswires)
Roche (ROG SW) – Genentech’s HEMLIBRA study met its primary and key secondary endpoints. (Newswires)
Risk sentiment was soured on Friday after reports that Special Counsel Robert Mueller subpoenaed Trump campaign personnel. Stocks were off, Treasuries rose, and haven FX and gold were in demand; oil rallied.
EQUITIES: S&P 500 -0.27% at 2584; Dow Jones -0.40% at 23464; Nasdaq-100 -0.43% at 6340.
Top sectors: Telecoms +0.78%, Energy +0.50%, Materials +0.21%
Bottom sectors: Utilities -0.80%, IT -0.66%, Industrials -0.39%
Stocks have managed eke out a small gain this week, though ended Friday trade in the red, led by losses in the defensive utilities sector as well as in tech. Financials were also under pressure in early trade with the risk-off theme dragging Treasury yields lower.
Telecoms were leading on potential deal activity, with Comcast reportedly interested in buying assets from Fox – assets which Disney was also eyeing.
Retailers continue to be in focus; after hitting an all-time high on Thursday, Wal-Mart slipped on profit-taking. Gap surged after yesterday’s earnings and comp sales beat; numbers from Abercrombie and Fitch and Foot Locker also helped to lift retailers.
20 Nov 2017 - 06:47- Research Sheet- Source: Newswires
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