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Europe Movers: ABF, Ericsson, Logitech Martsons, Sanofi, Swatch

Inga Muller
23 Jan, 2024
Frankfurt

Benchmark indexes across Europe traded around the flatline ahead of the rate decision announcement by the European Central Bank on Thursday.

The DAX index decreased 0.07% to 16,670.45, the CAC-40 index fell 0.2% to 7,401.76, and the FTSE 100 index inched down 0.2% to 7,475.41.

The yield on 10-year German bonds edged up to 2.30%; French bonds inched lower to 2.80%; the UK gilts edged higher to 3.93%; and Italian bonds inched higher to 3.87%.

Sanofi SA declined 1.7% to €92.63 after the French pharmaceutical company agreed to acquire the U.S. biotech company Inhibrx Inc. for as much as $2.2 billion.

Inhibrx shareholders will receive $30 in cash for each share held, a contingent value right of $5.0, and 0.25 shares of a new publicly traded company that will retain Inhibrx’s non-INBRX-101 assets, the immuno-oncology drug pipeline.

Sanofi will retain an 8% stake in the new Inhibrx.

Marston's PLC declined 0.2% to 33.25 pence, despite the pub house operator reporting a solid holiday sales increase.

Associated British Foods increased 1.4% to 2,300.0 pence after the company announced its trading update for 16 weeks ending on January 6.

The company said its discount apparel store chain, Primark, benefited from cash-strapped consumers looking for discounts, but added that underlying sales growth slowed in the last quarter.

L. M. Ericsson declined a fraction to kr61.26 in Stockholm trading after the telecom equipment maker said challenging market conditions are likely to persist in 2024.

The Swatch Group declined 2.5% to CHF 207.30 after the Swiss watch maker reported weaker-than-expected record sales predicted by its chief executive.

2023 net sales at the current exchange rate increased 5.2% to CHF 7.88 billion, and net income increased by 8.1% to CHF 890 million from CHF 823 million a year ago.

The company plans to increase its annual dividend by CHF 1.30 to CHF 6.50 per share at its next annual general meeting on May 8.

Logitech International dropped 6.5% to CHF 77.56 after the computer accessories maker estimated an annual sales decline between 6% and 7%.

Revenue in the fiscal third quarter ending in December declined 1% to $1.26 billion, net income rose to $247.7 million from $140.5 million, and diluted earnings per share rose to $1.57 from 87 cents a year ago.

The company revised its sales outlook for the fiscal year 2024 to range between $4.2 billion and $4.25 billion, a decline between 6% and 7% compared to the previous estimate of between $4.0 and $4.15 billion, a decline between 9% and 12%.

Premier Foods declined 0.1% to 140.04 pence after the company reported its fiscal third quarter results.

Total sales increased 14.4% to £352.7 million from £308.2 million, driven by a grocery sale increase of 11.9% to £252.7 million and a sweet treats sales rise of 21.3% to £100.0 million.

The company reiterated its previously raised profit expectations for the fiscal fourth quarter.

Subdued Trading In Europe, ECB Rate Action Awaited

Bridgette Randall
23 Jan, 2024
Frankfurt

European markets lacked direction, and investors debated the rate path and the prospect of economic growth and cooler inflation amid global economic uncertainties and elevated geopolitical tensions.

Market indexes in Frankfurt, London, and Paris trade around the flat line, and investors are worried that the European Central Bank may keep higher rates for longer and dash hopes of rate cuts later in the year.

Policymakers are set to announce rate decisions and monetary policy direction on Thursday, and investors are hoping to get more insights about the future rate path.

In Asia, the Bank of Japan held its short-term interest rate at -0.1% and kept the yield around zero on 10-year Japanese government bonds.

The central bank also lowered its 2024 inflation outlook to 2.4% from its previous estimate of 2.8% released in October.

Market indexes in Shanghai and Hong Kong advanced, and the yuan jumped to 7.18 against the U.S. dollar after China's cabinet pledged to take more "forceful" measures to stabilize financial markets.

UK Public Sector Borrowing Declined In December

The UK public sector borrowing fell sharply in December from a year ago and dropped to the lowest level since 2019, the Office for National Statistics reported Tuesday.

Public sector borrowing, excluding public sector banks, dropped to £7.8 billion from £16.2 billion in December.

Total public sector receipts increased 5.9% to £89.5 billion because of higher collection of VAT and income tax, and spending declined 3.4% to £97.3 billion, driven down in part by lower interest payments.

Total borrowing in the nine-month period to December of the current financial year rose by £11.1 billion to £119.1 billion, the fourth highest borrowing in the period on record.

Europe Indexes and Yields

The DAX index decreased 0.07% to 16,670.45, the CAC-40 index fell 0.2% to 7,401.76, and the FTSE 100 index inched down 0.2% to 7,475.41.

The yield on 10-year German bonds edged up to 2.30%; French bonds inched lower to 2.80%; the UK gilts edged higher to 3.93%; and Italian bonds inched higher to 3.87%.

The euro edged lower to $1.088, the British pound inched higher to $1.272, and the U.S. dollar gained to 86.81 Swiss cents.

Brent crude decreased $0.56 to $79.47 a barrel, and the Dutch TTF natural gas increased by €0.53 to €27.79 per MWh.

Europe Stock Movers

Marston's PLC declined 0.2% to 33.25 pence, despite the pub house operator reporting a solid holiday sales increase.

Associated British Foods increased 1.4% to 2,300.0 pence after the company announced its trading update for 16 weeks ending on January 6.

The company said its discount apparel store chain, Primark, benefited from cash-strapped consumers looking for discounts, but added underlying sales growth slowed in the last quarter.

L. M. Ericsson declined a fraction to kr61.26 in Stockholm trading after the telecom equipment maker said challenging market conditions are likely to persist in 2024.

Sanofi SA declined 1.7% to €92.63 after the French pharmaceutical company agreed to acquire the U.S. biotech company Inhibrx Inc. for as much as $2.2 billion.

Inhibrx shareholders will receive $30 in cash for each share held, a contingent value right of $5.0, and 0.25 shares of a new publicly traded company that will retain Inhibrx’s non-INBRX-101 assets, the immuno-oncology drug pipeline.

Sanofi will retain an 8% stake in the new Inhibrx.

Bank of Japan Holds Rates, China Stocks Rebound After Talks of Support Measures

Arjun Pandit
23 Jan, 2024
Mumbai

Market indexes rebounded in China, accelerated in Japan, and struggled to advance in India in Tuesday's trading.

In overnight trading in New York, the tech-powered rally extended to the second week after investors bid up semiconductor and mega-cap tech stocks.

Crude oil was also in focus after the U.S. and U.K. carried out additional military strikes targeting Houthi rebel bases in Yemen.

The attacks on Monday, supported by Australia, Bahrain, Canada, and the Netherlands, targeted eight sites used for arms and supply storage and missile surveillance capabilities.

Japan Holds Interest Rates

Market indexes in Tokyo advanced after the Bank of Japan held its benchmark interest rate as expected.

The Nikkei 225 Average jumped 1.2% to a new 34-year high of 36,981.80 and extended gains for the third consecutive session.

The Bank of Japan held its short-term lending rate to -0.1% and the yield around zero for 10-year Japanese government bonds by a unanimous vote.

Market enthusiasm was supported by a higher closing in New York in overnight trading, and tech stocks extended their rally in the second week.

China Stocks Rebound On Stimulus Hopes

The Hang Seng index soared 2.5% to 15,333.01, and tech stocks led the gainers after the indexes rebounded from a near-15-month low.

Chinese policymakers have struggled to provide meaningful support to financial markets after years of reckless spending on infrastructure driven by a surge in government debt.

By some measures, the Chinese government debt-to-GDP ratio is nearing 300%, the highest among large economies in the world.

Pessimism in Chinese markets is not likely to reverse in the near term as Chinese consumers retrench from spending, avoid pumping additional savings into the property market, and increase cash savings in the face of economic and labor market uncertainties.

Earnings Growth Expectations Power India Indexes

Stocks in Mumbai advanced in early trading on Tuesday, and the Nifty and Sensex indexes traded sideways after investors returned from the Monday holiday.

Travel stocks were in focus after Ram Mandir Pran Pratistha of Ram Temple in Ayodhya.

The religious site is expected to attract as many as 10 crore, or 100 million, travelers to the city in Uttar Pradesh this year.

The Sensex index increased 584.75 points to 72,008.40, and the Nifty index rose 166.55 points to 21,738.35.

On the Mumbai stock exchange, 297 stocks traded at their 52-week highs and 10 stocks traded at their 52-week lows.

The yield on the 10-year Indian government bonds increased to 7.18%, and the Indian rupee edged lower to ₹83.11 against the U.S. dollar.

In other markets in the region, the KOSPI index in Seoul added 0.4% to 2,473.54, and the ASX200 index in Sydney advanced 0.5% to 7,517.30.

India Movers: Central Bank of India, Cipla, Colgate, Coforge, MRPL, Oberoi Realty, Tamilnad Mercantile, Zee Ent

Arun Goswami
23 Jan, 2024
Mumbai

Benchmark indexes in Mumbai traded higher, and travel stocks were the focus after Pran Pratishtha in Ram Mandir.

The Sensex index increased 584.75 points to 72,008.40, and the Nifty index rose 166.55 points to 21,738.35.

On the Mumbai stock exchange, 297 stocks traded at their 52-week highs and 10 stocks traded at their 52-week lows.

Zee Entertainment dropped 10% to ₹208.30 after Sony Pictures Network India terminated its plan to acquire the company for $10 billion.

Sony also demanded $90 million, or about ₹750 crore, in termination fees from the company.

Central Bank of India declined 0.8% to ₹55.80, and the bank proposed for the government to lower its stake through a sale to improve stock trading liquidity.

The central government bank currently holds about a 93% stake in the bank after the government pumped about 19,903 crore over the four-year period between fiscal years 2018 and 2021, according to data available from the CRISIL rating agency.

Cipla Ltd. increased 6.6% to ₹1,403.20 after the pharmaceutical company reported quarterly results.

Revenue in the December quarter jumped 13% to 6,505 crore, and net income advanced 32% to 1,055.90 crore from a year ago, respectively.

Oberoi Realty decreased 8.4% to ₹1,378.75 after the company reported a decline in revenue and earnings in its latest quarterly results.

Revenue in the December quarter decreased 12.9% to 1,082.9 crore and net profit declined 21% to 360 crore from a year ago, respectively.

Mangalore Refinery and Petrochemicals declined 2.6% to ₹170.30 after the company reported weaker-than-expected quarterly results.

Revenue declined 8.4% to 28,423 crore and the company swung to a net income of 387.1 crore compared to a loss of 188 crore in the quarter a year ago.

Colgate Palmolive India declined 1.3% to ₹2,503.70 after the company reported mixed quarterly results.

Revenue in the December quarter rose 8.2% to 1,836 crore, and net income soared 35% to 330 crore from 243 crore a year ago.

Coforge Ltd. declined 0.5% to ₹6,251.50 after the tech services company reported weak earnings growth.

Revenue in the December quarter increased 13% to 2,323 crore and net income rose 4.3% to 236 core from 228 crore a year ago.

Tamilnad Mercantile Bank declined 1.4% to ₹499.90 after the regional bank reported weak quarterly earnings growth.

Total income in the December quarter increased 18% to ₹1,387 crore, and net income rose 1% to ₹284 crore from ₹280 crore a year ago.

S&P 500, Dow, Nasdaq 100 Indexes Trade at New Highs

Barry Adams
22 Jan, 2024
New York City

Benchmark indexes on Wall Street attempted to build on the previous week's gains after the tech stock rally pushed indexes into the positive zone.

The S&P 500, the Dow Jones Industrial Average, and the Nasdaq 100 indexes traded at new intra-day highs as the previous week's tech rally continued in the new week.

The S&P 500 index and the Nasdaq Composite index gained sharply in Friday's trading after AI-related enthusiasm led semiconductor stocks to new highs.

Investors have shifted their attention to the latest data on the economy, labor market, and inflation after weeks of debating about the number and timing of rate cuts this year.

The S&P 500 index jumped to a new intraday and end-of-day high after two years in Friday's trading.

Last week, U.S. market indexes advanced amid heightened volatility, and investors focused on a slew of positive economic data in the last two weeks.

Moreover The retail sales report in December signaled resilient consumer spending, adding to the strong labor market conditions and weakening inflation level reported in the previous two weeks and providing another lift to market indexes.

However, existing home sales dropped to a 13-year low in December amid high home prices and elevated mortgage rates as buyers struggled to find properties.

On the international front, the Bank of Japan is scheduled to announce its rate decision on Tuesday, and the European Central Bank is set to announce its monetary policy details on Thursday.

Both central banks are expected to hold rates steady, and the People's Bank of China held its reference rates steady today.

The central bank left its one-year loan prime rate at 3.45% and the 5-year reference rate used for mortgage loans at 4.2%.

The ongoing property market woes and the lack of strong policy action from the People's Bank of China pushed the Hang Seng index down more than 2% and extended 2024 losses to 10%.

U.S. Indexes and Yields

The S&P 500 index increased 0.3% to 4,855.85, and the Nasdaq Composite rose 0.5% to 15,381.77.

The yield on 2-year Treasury notes increased to 4.39%. 10-year Treasury notes advanced to 4.09%, and 30-year Treasury bonds edged up to 4.30%.

WTI crude oil increased $1.54 to $74.78 a barrel, and natural gas prices decreased 12 cents to $2.38 a thermal unit.

Gold decreased by $6.10 to $2,022.99 an ounce after declining in the previous week following the general strength in the U.S. dollar.

The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 103.13.

U.S. Stock Movers

Sunoco declined 6.2% to $55.77 after the automotive fuel distributor agreed to acquire NuStar Energy, in an all-equity transaction valued at $7.3 billion.

NuStar soared 20% to 15.9% to $20.91.

NuStar common unitholders will receive 0.4 Sunoco common units for each NuStar common unit, implying a 24% premium based on the 30-day volume-weighted average price of both NuStar and Sunoco as of January 19, 2024.

Sunoco has secured a $1.6 billion one-year bridge term loan to refinance NuStar's purchase and assume its debt.

Boeing decreased 1.3% to $212.15 after the Federal Aviation Administration expanded its inspection of door plug design on the 737 900-ER.

The FAA ordered an investigation after, earlier in the month, a 737 Max 9 plane used by Alaska Air Flight blew off a door midflight.

The government agency expanded the probe from the 737 Max 9 because the same door plug design is used in the 737 900-ER model.

Macy's Inc. increased 4.3% to $18.39 after the department store chain rejected a $5.8 bid by a consortium of investors, citing the offer was not financially attractive and lacked credible financing.

Ark House and Brigade Capital Management proposed to acquire shares in the company for $21 per share.

Archer Daniels-Midland plunged 15% to $58 after the company said it placed its chief financial officer, Vikram Luthra, on administrative leave amid an accounting practices investigation.

The company also offered a weaker-than-expected fourth-quarter earnings outlook.

European Markets Cautiously Advance Ahead of ECB Rate Decision

European markets advanced, and investors debated the rate path and economic outlook in the current year.

Benchmark indexes in Frankfurt, London, and Paris gained, and investors looked ahead to the rate decision from the European Central Bank on Thursday.

In Friday's trading, market indexes in New York jumped more than 1%, and the tech-heavy Nasdaq Composite index soared 1.7% after investors bid up semiconductor and mega-cap tech stocks.

In Monday's trading in Europe, ASML gained 1.5% and Infineon added 1.0%.

Last week, European markets declined between 1% and 2% after the European Central Bank’s policymakers pushed back aggressively against the market's enthusiasm for rate cuts in the near future.

Moreover, Germany, the largest economy in the eurozone, reported that GDP contracted in 2023, keeping the prospect of a recession alive.

However, passenger car registration rose 14% to 10.5 million in 2023 in the European Union despite rising interest rates and consumers avoiding discretionary items amid elevated inflation.

The European Central Bank is widely anticipated to hold rates steady at the end of its policy meeting on Thursday, and policymakers are likely to stress that inflation is too high and that higher rates for longer are still needed to bring down inflation to the target rate of 2%.

Europe Indexes and Yields

The DAX index increased 0.7% to 16,669.22, the CAC-40 index rose 0.6% to 7,415.68, and the FTSE 100 index inched up 0.4% to 7,492.27.

The yield on 10-year German bonds edged down to 2.26%; French bonds inched lower to 2.81%; the UK gilts edged lower to 3.89%; and Italian bonds inched lower to 3.84%.

The euro edged lower to $1.089, the British pound inched higher to $1.270, and the U.S. dollar gained to 86.80 Swiss cents.

Brent crude advanced $1.37 to $79.97 a barrel, and the Dutch TTF natural gas decreased by €1.15 to €27.28 per MWh.

Europe Stock Movers

Credit Agricole added 0.7% to €13.32 after the French bank said it acquired a minority 7% stake in payment and transaction processing services provider Worldline SA.

The terms of the transaction were not disclosed.

Kindred Group PLC jumped 16.7% to kr121.85 after the online gambling company confirmed it received a takeover proposal from La Francaise des Juex, valuing the company at €2.45 billion.

Bodycote PLC jumped 4.3% to 621.75 pence after the heat treatment and thermal processing company provider said it plans to repurchase up to £60 million of its own shares.

Endeavour Mining PLC decreased 1.7% to 1,360.0 pence, despite the gold mining company estimating 2024 production to increase by 18%.

SDI Group PLC dropped 7.4% to 75.0 pence after its chief executive, Mike Creedon, stepped down on January 19.

Sandoz Group AG gained 1.9% to CHF 28.56 after the Swiss generic and biosimilar medicine maker announced to acquire ranibizumab CIMERLI from Coherus BioSciences, Inc. for an initial payment of $170 million with additional milestone-based payments.

The drug is used to treat macular degeneration in the retina, leading to progressive loss of vision.

Asia: Nikkei Tracks U.S. Stocks Higher, Hang Seng Extends 2024 Losses to 10%

Asian markets diverged in Monday's trading in a familiar pattern, with the indexes in Japan trading higher following the gains in New York and foreign investors accelerated sale of Chinese stocks.

Market indexes in Japan advanced following the rise in tech stocks in New York, and in China, investors continued selling stocks after the People's Bank of China held its 1-year and 5-year rates as expected.

The Nikkei index in Tokyo advanced 1.5% to 36,517.84, another new 34-year high, after tech stocks powered the rally following a rise in New York in overnight trading.

SoftBank advanced 2%, Fast Retailing gained more than 1%, Toyota Motor gained 0.5%, and Honda Motor advanced 1.6%.

Tech sector stocks were among the leading gainers, with Tokyo Electron, Advantest, and Screen Holding gaining between 2% and 4%.

Mitsubishi UFJ Financial, Sumitomo Mitsui Financial, and Mizuho advanced between 0.3% and 1%.

The Bank of Japan is widely anticipated to hold its reference rate and yield curve policy intact on Tuesday.

China Stocks Extend Losses, Hang Seng Down 10% In 2024

The one-year loan prime rate was held steady for the fifth month in a row at 3.45%, and the 5-year loan prime rate used for mortgage rates was maintained for the seventh month in a row at 4.2%.

The Hang Seng index declined 2% to 14,932.18 in Monday's trading after the central bank failed to announce stimulus measures to revive the moribund property market.

The Hang Seng index is down more than 10% from the start of the year, its worst performance in January since 2016.

Baidu declined 3.5%, Tencent fell 2.5%, BYD declined 1.9%, and Li Ning dropped 6.5%.

Foreign investors continue to sell China stocks, keeping pressure on China indexes, as the government shows no sign of offering additional economic stimulus and consumer spending growth remains weak after the ending of COVID-19 restrictions.

So far in 2024, foreign investors have sold more than $4 billion of Chinese stocks, extending the total sale to $26 billion in the last six months, according to data available from Stock Connect.

India Stocks Advanced In Special Session On Saturday

Stocks in Mumbai advanced on Saturday in a special session, and financial markets are closed Monday to celebrate Ram Mahotsav.

The Sensex index gained 0.3% and the Nifty index advanced 0.5% in a shortened session on Saturday following the surge in overnight trading in New York.

The S&P 500 index jumped more than 1% and the Nasdaq Composite gained 1.7% after mega-cap tech stocks rebounded and investors overlooked rate path uncertainties.

Investors bid up stocks of banks, tech and financial services providers, and automotive sector stocks.

The Sensex index increased 236.79 points to 71,423.65, and the Nifty index rose 109.55 points to 21,571.80.

On the Mumbai stock exchange, 474 stocks traded at their 52-week highs and 9 stocks traded at their 52-week lows.

U.S. Movers: Archer Daniels-Midland, Boeing, Macy's, NuStar, Sunoco

Scott Peters
22 Jan, 2024
New York City

Sunoco declined 6.2% to $55.77 after the automotive fuel distributor agreed to acquire NuStar Energy, in an all-equity transaction valued at $7.3 billion.

NuStar soared 20% to 15.9% to $20.91.

NuStar common unitholders will receive 0.4 Sunoco common units for each NuStar common unit, implying a 24% premium based on the 30-day volume-weighted average price of both NuStar and Sunoco as of January 19, 2024.

Sunoco said it has secured a $1.6 billion one-year bridge term loan to refinance NuStar's purchase and assume its debt.

Boeing decreased 1.3% to $212.15 after the Federal Aviation Administration expanded its inspection of door plug design on the 737 900-ER.

The FAA ordered an investigation after, earlier in the month, a 737 Max 9 plane used by Alaska Air Flight blew off a door midflight.

The government agency expanded the probe from the 737 Max 9 because the same door plug design is used in the 737 900-ER model.

Macy's Inc. increased 4.3% to $18.39 after the department store chain rejected a $5.8 bid by a consortium of investors, citing the offer was not financially attractive and lacked credible financing.

Ark House and Brigade Capital Management proposed to acquire shares in the company for $21 per share.

Archer Daniels-Midland plunged 15% to $58 after the company said it placed its chief financial officer, Vikram Luthra, on administrative leave amid an accounting practices investigation.

The company also offered a weaker-than-expected fourth-quarter earnings outlook.

Tech Rally Extends to Monday On Wall Street