Market Update
China's Bubble Tea Chain Mixue Group's IPO Attracted Huge Interest from Retail Investors
Scott Peters
03 Mar, 2025
New York City
Investors in Hong Kong bid up stock price of the rapidly expanding beverage chain across Asia.
Mixue Group, China’s largest fresh-drink company, raised HK$3.45 billion ($444 million) in a Hong Kong initial public offering, aiming to expand its business amid heightened competition.
The company’s stock jumped in its Hong Kong trading debut on March 3, marking it the city’s most ever popular initial public offering.
Shares of the Zhengzhou-based company changed hands at HK$262 each when trading began in Hong Kong, 29.3% higher than the offer price of HK$202.50.
The opening price valued the company’s Hong Kong-listed equity base at HK$99 billion or $12.7 billion.
Offering Details
Mixue sold 17.1 million shares at HK$202.50 each, and the company's public offering's retail tranche was oversubscribed by 6,000 times.
Bank of America Securities, Goldman Sachs, and UBS are the joint sponsors of Mixue’s public offering.
The company plans to use the proceeds for production facilities, enhancing its brand and marketing, working capital, and general corporate purposes.
The offering attracted five cornerstone investors, who agreed to buy $200 million worth of the shares.
They were British asset manager M&G Investments, HongShan Capital’s growth fund, a unit of Boyu Capital, a Hillhouse Group fund, and Meituan’s Long-Z Fund.
Mixue began its book-building process on February 21, with a minimum investment requirement of HK$20,454.22 for a lot of 100 shares.
A base case valuation for Mixue suggested a market capitalization of HK$96 billion or a target price of HK$254, which was 26% higher than the IPO price.
Mixue’s subscription level is comparable to that of Chinese toymaker Bloks Group, which completed its HK$1.6 billion IPO last month, with retail investors subscribing for 6,000 times the shares that were allocated to them.
Hong Kong has successfully attracted several high profile companies to list their shares, and raise billions of dollars from investors.
The share offering follows peers Guming Holdings Ltd.’s HK$1.81 billion listing earlier in February and Sichuan Baicha Baidao Industrial Co. Ltd.’s HK$2.6 billion IPO in April 2024.
Company History
For the nine months ended in September, Mixue said revenue increased 21.2% to 18.66 billion yuan from 15.39 billion yuan, and profit rose 45.2% to 3.49 billion yuan from 2.45 billion yuan a year ago.
The company served up around 7.1 billion drinks in the period.
Founder and chairman Zhang Hongchao began the business in 1997 in Zhengzhou, the capital of the inland province Henan, with a homemade shaved ice machine.
In 2018, the firm launched Snow King as its company logo and brand ambassador.
Today, Mixue has 45,302 stores in 300 cities and 4,900 towns in mainland China and 11 overseas markets in Southeast Asia, Australia, Japan, and South Korea.
The beverage chain is well-known for its affordable prices of freshly made fruit and tea drinks, ice cream, and coffee, selling for about $1.
The company may have reached the growth ceiling in the China market based on its current expansion speed, analysts said.
In 2023, Mixue created or supported approximately 785,000 job opportunities, with 68% of store employees being female.
Mixue’s individual store performance experienced fluctuations in 2022, primarily due to the disruptions caused by the COVID-19 pandemic.
But while the company continued to scale its store network, the individual store performance has largely recovered post-pandemic since 2023.
The company’s agricultural procurement initiatives helped improve the livelihoods of approximately 167,000 farming households nationwide, and the efforts in green packaging upgrades led to a substantial reduction in the consumption of PE plastics by over 12,700 tons.
Mixue has two major brands: the freshly made tea drinks brand Mixue and the freshly made coffee brand Lucky Cup.
Gross profit from Mixue consistently accounted for over 95% of total revenue and gross profit, while Lucky Cup had been an immaterial contributor to the revenue and gross profit.
As of September 30, 2024, more than 99% of the company’s stores were franchised stores. Its global procurement network spans 38 countries across six continents.
Through its in-house R&D and production capabilities, the company offers a one-stop ingredients solution with full categories including products of syrups, milk, tea, coffee, fruit, grains, and condiments.
Mixue has five production bases in Henan, Hainan, Guangxi, Chongqing, and Anhui, occupying a total of approximately 0.79 million square meters and having a total annual production capacity of approximately 1.65 million tons.
The company’s self-operated warehouse system and dedicated delivery network are able to support the most extensive store network in China’s freshly made drinks industry.
The warehouse system, which is the largest in the industry, comprises 27 warehouses nationwide, totaling approximately 350,000 square meters.
Market Opportunities
China’s freshly made drinks market is projected to grow at a compounded annual growth rate of 17.6% from 2023 to 2028 to reach 1,163.4 billion yuan in 2028, according to the company's projection released in the offering document.
Within this market, mass-market, freshly made drinks, with a price per item not higher than 10 yuan, not only address growing consumer demands for value-for-money products but also offer fresher products and an engaging consumer experience compared to other mass-market drink products in the similar price range.
Consequently, the mass-market freshly made drinks segment exhibits the highest growth rate among all segments by price range within China’s freshly made drinks market, growing at a compounded annual growth rate of 22.2% from 2023 to 2028.
The freshly made drinks market in Southeast Asia, as measured by gross merchandise value, is projected to grow at a CAGR of 19.8% from $20.1 billion in 2023 to $49.5 billion in 2028, marking the fastest growth among major markets worldwide.
Retail Investors
The retail portion of Mixue’s IPO attracted more than HK$1.6 trillion ($205.9 billion) in subscriptions, and the original size of the retail tranche was increased to 50% of the total offering size.
Retail investors borrowed nearly HK$1.83 trillion via brokerages to subscribe to the stock, oversubscribing the offering by 5,295 times.
Thus, Mixue surpassed a record set by Ant Group’s IPO in 2020 and Kuaishou Technology’s share sale in 2021, which both attracted around HK$1.3 trillion in margin loans from retail investors.
Some investors would bet that the share price would go up in the improved market environment, as the city’s Hang Seng Index has risen more than 20% from a January low.
Futu Securities lent as much as HK$1.07 trillion, followed by Phillip Securities with HK$333 billion, and some brokers offered zero-interest and highly leveraged loans to attract clients so they could buy shares.
Analysts said that individual investors benefited from the flexible financing that came out of changes introduced by the Fast Interface for New Issuance (FINI) platform.
The FINI platform allows brokers to prepay only for the maximum number of shares allotted in a public offering, avoiding the need to lock in funds for the entire excess amount.
The lower cost for brokers to offer margin loans had made the IPO multiples higher.
Japan Indexes Advance 1% After a Week of Turbulent Trading
Akira Ito
14 Mar, 2025
Tokyo
Stock market indexes in Tokyo rebounded in Friday's trading as bargain hunters returned despite escalating global trade tensions.
The Nikkei 225 stock average gained 0.9% and extended the weekly rise to 1.0%; the TOPIX advanced 0.9% and extended the weekly gain to 0.95%.
Despite the market rebound, sentiment remained fragile as investors feared a new round of U.S. tariffs could target Japan's exports.
The Trump administration announced 200% tariffs on alcoholic beverages from the European Union after the region of 27 nations retaliated with its own tariffs of 50% on U.S. whiskey.
The it-for-tat tariffs could spiral out of control and drag down global goods trade, shrink global economic growth, and reorder supply chains away from the U.S.
Closer to home, investors reviewed the latest comments from Bank of Japan Governor Kazuo Ueda targeting the need to shrink the central bank's balance sheet.
The Bank of Japan is likely to announce its rate hike decision at the end of two-day policy meeting on March 19, amid rising wages and inflation above 2%.
Japan Indexes and Stocks
The Nikkei 225 Stock Average increased 0.9% to 37,095.73 and TOPIX gained 0.8% to 2,718.86.
Advantest Corp. gained 5.3% to ¥8,245.0, Keyence Corp. advanced 2.2% to ¥61,400.0, Disco Corp. increased 3.7% to ¥35,700.0.
Seven & Holdings Co. Ltd. decreased 1.8% to ¥2,168.0, and the Canada-based Couche Tard ramped up its campaign to convince shareholders to accept its hostile deal.
Defense related stocks advanced for the second week in a row amid expectations that Japanese government will ramp up its arms purchases.
Kawasaki Heavy Industries jumped 3.3% to ¥9,166.0, IHI Corp. gained 1.6% to ¥10,775.0, and Mitsubishi Heavy Industries increased 2.5% to ¥2,556.0.
Japan Indexes Advance 1% After a Week of Turbulent Trading
Akira Ito
14 Mar, 2025
Tokyo
Stock market indexes in Tokyo rebounded in Friday's trading as bargain hunters returned despite escalating global trade tensions.
The Nikkei 225 stock average gained 0.9% and extended the weekly rise to 1.0%; the TOPIX advanced 0.9% and extended the weekly gain to 0.95%.
Despite the market rebound, sentiment remained fragile as investors feared a new round of U.S. tariffs could target Japan's exports.
The Trump administration announced 200% tariffs on alcoholic beverages from the European Union after the region of 27 nations retaliated with its own tariffs of 50% on U.S. whiskey.
The it-for-tat tariffs could spiral out of control and drag down global goods trade, shrink global economic growth, and reorder supply chains away from the U.S.
Closer to home, investors reviewed the latest comments from Bank of Japan Governor Kazuo Ueda targeting the need to shrink the central bank's balance sheet.
The Bank of Japan is likely to announce its rate hike decision at the end of two-day policy meeting on March 19, amid rising wages and inflation above 2%.
Japan Indexes and Stocks
The Nikkei 225 Stock Average increased 0.9% to 37,095.73 and TOPIX gained 0.8% to 2,718.86.
Advantest Corp. gained 5.3% to ¥8,245.0, Keyence Corp. advanced 2.2% to ¥61,400.0, Disco Corp. increased 3.7% to ¥35,700.0.
Seven & Holdings Co. Ltd. decreased 1.8% to ¥2,168.0, and the Canada-based Couche Tard ramped up its campaign to convince shareholders to accept its hostile deal.
Defense related stocks advanced for the second week in a row amid expectations that Japanese government will ramp up its arms purchases.
Kawasaki Heavy Industries jumped 3.3% to ¥9,166.0, IHI Corp. gained 1.6% to ¥10,775.0, and Mitsubishi Heavy Industries increased 2.5% to ¥2,556.0.
Bargain Hunters Lift China and Hong Kong Stocks, AIA Reports Record Earnings In 2024
Li Chen
14 Mar, 2025
Hong Kong
Stock market indexes rebounded in China and Hong Kong as investors searched for bargains and overlooked another round of fresh tariffs announced by the U.S.
The Hang Seng index soared nearly 3%, and the mainland-focused CSI 300 index advanced nearly 2.5%, and benchmark indexes halted a five-day decline.
Stock market volatility reached a new high this week amid escalating trade tensions between the U.S. and Europe, and the U.S. announced its plans to expand its tariffs to shipments from Japan.
Moreover, Russia rejected a peace plan proposed by the U.S. for a 30-day ceasefire with Ukraine, as the war continues into the fourth year with no end in sight.
After today's rally, the Hang Seng index erased weekly losses of more than 3%, and the CSI 300 index gained 1.7% in the period.
The Friday's market surge was partly driven by the expectations of a policy shift announcement scheduled on Monday, and investors are hoping that policymakers will provide detailed implementation plans for the previously announced stimulus measures.
In overnight trading in New York, the S&P 500 index closed down 1.4% and the Nasdaq Composite plunged 2%, and benchmark indexes extended losses to more than 10% from the peak in mid-February.
China Indexes and Stocks
The Hang Seng index soared 2.5% to 24,047.46, and the mainland-focused CSI 300 index advanced 2.4% to 4,004.21.
Alibaba Group Holding jumped 3.3% to HK $135.80, Tencent Holdings advanced 3.7% to HK $526.0, Baidu Inc. increased 2.2% to HK $91.45, and JD.com Inc. added 4.5% to HK $164.40.
Electric vehicle makers advanced in Friday's trading, as investors anticipated additional support by the government to lift domestic sales.
Li Auto advanced 1% to HK $111.60, BYD jumped 4.9% to HK $378.60, and Xpeng Inc. decreased 4.3% to HK $91.35.
AIA Group Ltd. decreased 2.8% to HK $61.05 despite the insurance company reporting a surge in 2024 profit.
The insurance company said net income in 2024 advanced 82% to $6.4 billion, driven by an 18% increase in new business value to $4.71 billion.
Mainland customers continued to buy Hong Kong dollar-denominated health and life insurance policies to hedge against the potential future decline in the yuan.
New business revenue in Hong Kong advanced 23% to $1.8 billion, in mainland China soared 20% to $1.2 billion, and in Thailand and Singapore advanced 15%, followed by 10% gains in Malaysia.
The insurance company announced a final dividend of HK $1.3098, increasing the total dividend by 9% from a year ago to HK $1.7548.
As a part of the company's goal to return capital to shareholders, the insurance company announced a $1.6 billion stock repurchase plan.
Bargain Hunters Lift China and Hong Kong Stocks, AIA Reports Record Earnings In 2024
Li Chen
14 Mar, 2025
Hong Kong
Stock market indexes rebounded in China and Hong Kong as investors searched for bargains and overlooked another round of fresh tariffs announced by the U.S.
The Hang Seng index soared nearly 3%, and the mainland-focused CSI 300 index advanced nearly 2.5%, and benchmark indexes halted a five-day decline.
Stock market volatility reached a new high this week amid escalating trade tensions between the U.S. and Europe, and the U.S. announced its plans to expand its tariffs to shipments from Japan.
Moreover, Russia rejected a peace plan proposed by the U.S. for a 30-day ceasefire with Ukraine, as the war continues into the fourth year with no end in sight.
After today's rally, the Hang Seng index erased weekly losses of more than 3%, and the CSI 300 index gained 1.7% in the period.
The Friday's market surge was partly driven by the expectations of a policy shift announcement scheduled on Monday, and investors are hoping that policymakers will provide detailed implementation plans for the previously announced stimulus measures.
In overnight trading in New York, the S&P 500 index closed down 1.4% and the Nasdaq Composite plunged 2%, and benchmark indexes extended losses to more than 10% from the peak in mid-February.
China Indexes and Stocks
The Hang Seng index soared 2.5% to 24,047.46, and the mainland-focused CSI 300 index advanced 2.4% to 4,004.21.
Alibaba Group Holding jumped 3.3% to HK $135.80, Tencent Holdings advanced 3.7% to HK $526.0, Baidu Inc. increased 2.2% to HK $91.45, and JD.com Inc. added 4.5% to HK $164.40.
Electric vehicle makers advanced in Friday's trading, as investors anticipated additional support by the government to lift domestic sales.
Li Auto advanced 1% to HK $111.60, BYD jumped 4.9% to HK $378.60, and Xpeng Inc. decreased 4.3% to HK $91.35.
AIA Group Ltd. decreased 2.8% to HK $61.05 despite the insurance company reporting a surge in 2024 profit.
The insurance company said net income in 2024 advanced 82% to $6.4 billion, driven by an 18% increase in new business value to $4.71 billion.
Mainland customers continued to buy Hong Kong dollar-denominated health and life insurance policies to hedge against the potential future decline in the yuan.
New business revenue in Hong Kong advanced 23% to $1.8 billion, in mainland China soared 20% to $1.2 billion, and in Thailand and Singapore advanced 15%, followed by 10% gains in Malaysia.
The insurance company announced a final dividend of HK $1.3098, increasing the total dividend by 9% from a year ago to HK $1.7548.
Growing Worries of U.S. Economic Recession Drag Down Wall Street Indexes
Barry Adams
13 Mar, 2025
New York City
Stocks struggled in New York amid growing worries about the health of the U.S. economy and future rate path.
The S&P 500 index declined 0.4%, and the Nasdaq Composite fell as much as 0.9% and extended weekly losses to 3%.
Benchmark indexes are likely to close down for the fourth week in a row, as the Trump administration doubles down on global tariff trade policy despite its impact on consumers and the broader economy.
The European Union slapped tariffs on American products, including whiskey and motorcycles, in retaliation to the U.S. tariff on steel and other manufactured products.
Investors are concerned that the constantly changing Trump administration's tariff wars are adding another layer to the market volatility, economic uncertainty, and turmoil in the world trade.
However, the latest producer price inflation report showed that those tariff wars, so far, have not fueled inflation.
Producer price inflation was 3.2% in February, slower than the revised 3.7% in January, the U.S. Bureau of Labor Statistics reported Thursday.
Core inflation, which excludes volatile energy, food prices, and services, slowed to a ten-month low of 3.3% in February.
Despite the slowdown in consumer and producer price inflation, both measures are still higher than 2%, suggesting that elevated levels are here to stay for several months or longer.
Weekly jobless claims in the first week in March edged down 2,000 to 220,000, and continuing claims which lag by a week dropped 27,000 to 1.87 million, the U.S. Bureau of Labor Statistics reported Thursday.
Commodities, Currencies, Indexes, Yields
The S&P 500 index decreased 0.4% to 5,577.78, the Nasdaq Composite edged down 0.7% to 17,525.10, and the Russell 2000 index was up 0.05% to 2,027.50.
The yield on 2-year Treasury notes edged higher to 4.01%, 10-year Treasury notes increased to 4.34%, and 30-year Treasury bonds advanced to 4.65%.
WTI crude oil decreased $0.66 to $67.02 a barrel, and natural gas prices edged lower by $0.10 to $3.98 a therm. unit.
Gold increased by $6.15 to $2,944.12 an ounce, and silver edged down by $0.17 to $33.10.
The dollar index, which weighs the US currency against a basket of foreign currencies, increased 0.44 to 104.06 and traded at a two-year high.
U.S. Stock Movers
Adobe Inc. dropped 10.9% to $391.38 after the graphic design software developer reported strong results for the fiscal first quarter of 2025 ending in February, but the company's weak sales outlook failed to impress investors.
The company guided second quarter revenue to range between $5.77 billion and $5.82 billion, up from $5.31 billion a year ago, and earnings per share between $3.80 and $3.85, up from $3.49 in the same period in 2024.
American Eagle Outfitters Inc. dropped 5.1% to $10.86 after the specialty apparel retailer reported comparable sales growth of 3% in the fiscal fourth quarter of 2024.
However, the specialty apparel retailer estimated current quarter sales growth in the "mid-single-digit," lower than the market expectation of at least a 1% increase.
SentinelOne declined 3% to $18.68, and the cybersecurity company's quarterly results surpassed market expectations, but the current quarter sales outlook of $228 million fell short of market expectations.
Intel Corp. jumped 16% to $24.08 after the company appointed a new chief executive to lead its turnaround efforts.
Lip-Bu Tan, former chief executive of Cadence Design Systems, will assume the top position and lead the company's effort in setting up its foundry operation and accelerate its new chip designs.
Growing Worries of U.S. Economic Recession Drag Down Wall Street Indexes
Barry Adams
13 Mar, 2025
New York City
Stocks struggled in New York amid growing worries about the health of the U.S. economy and future rate path.
The S&P 500 index declined 0.4%, and the Nasdaq Composite fell as much as 0.9% and extended weekly losses to 3%.
Benchmark indexes are likely to close down for the fourth week in a row, as the Trump administration doubles down on global tariff trade policy despite its impact on consumers and the broader economy.
The European Union slapped tariffs on American products, including whiskey and motorcycles, in retaliation to the U.S. tariff on steel and other manufactured products.
Investors are concerned that the constantly changing Trump administration's tariff wars are adding another layer to the market volatility, economic uncertainty, and turmoil in the world trade.
However, the latest producer price inflation report showed that those tariff wars, so far, have not fueled inflation.
Producer price inflation was 3.2% in February, slower than the revised 3.7% in January, the U.S. Bureau of Labor Statistics reported Thursday.
Core inflation, which excludes volatile energy, food prices, and services, slowed to a ten-month low of 3.3% in February.
Despite the slowdown in consumer and producer price inflation, both measures are still higher than 2%, suggesting that elevated levels are here to stay for several months or longer.
Weekly jobless claims in the first week in March edged down 2,000 to 220,000, and continuing claims which lag by a week dropped 27,000 to 1.87 million, the U.S. Bureau of Labor Statistics reported Thursday.
Commodities, Currencies, Indexes, Yields
The S&P 500 index decreased 0.4% to 5,577.78, the Nasdaq Composite edged down 0.7% to 17,525.10, and the Russell 2000 index was up 0.05% to 2,027.50.
The yield on 2-year Treasury notes edged higher to 4.01%, 10-year Treasury notes increased to 4.34%, and 30-year Treasury bonds advanced to 4.65%.
WTI crude oil decreased $0.66 to $67.02 a barrel, and natural gas prices edged lower by $0.10 to $3.98 a therm. unit.
Gold increased by $6.15 to $2,944.12 an ounce, and silver edged down by $0.17 to $33.10.
The dollar index, which weighs the US currency against a basket of foreign currencies, increased 0.44 to 104.06 and traded at a two-year high.
U.S. Stock Movers
Adobe Inc. dropped 10.9% to $391.38 after the graphic design software developer reported strong results for the fiscal first quarter of 2025 ending in February, but the company's weak sales outlook failed to impress investors.
The company guided second quarter revenue to range between $5.77 billion and $5.82 billion, up from $5.31 billion a year ago, and earnings per share between $3.80 and $3.85, up from $3.49 in the same period in 2024.
American Eagle Outfitters Inc. dropped 5.1% to $10.86 after the specialty apparel retailer reported comparable sales growth of 3% in the fiscal fourth quarter of 2024.
However, the specialty apparel retailer estimated current quarter sales growth in the "mid-single-digit," lower than the market expectation of at least a 1% increase.
SentinelOne declined 3% to $18.68, and the cybersecurity company's quarterly results surpassed market expectations, but the current quarter sales outlook of $228 million fell short of market expectations.
Intel Corp. jumped 16% to $24.08 after the company appointed a new chief executive to lead its turnaround efforts.
Lip-Bu Tan, former chief executive of Cadence Design Systems, will assume the top position and lead the company's effort in setting up its foundry operation and accelerate its new chip designs.
German and French Bond Yields Near 16-Year Highs Amid New Borrowing Plans and Tariff Worries
Bridgette Randall
13 Mar, 2025
London
European markets lacked direction amid escalating trade tensions with the U.S. and geopolitical uncertainties.
Benchmark indexes in Frankfurt and Paris turned lower as investors reviewed the latest political development in Germany.
The two leading German parties, CDU and SPD, lacking a clear majority, are struggling to form a coalition with the Green Party and prepare a plan to increase the federal government debt limit to finance infrastructure spending.
So far, the Green Party has rejected the government's proposal to raise the debt limit to finance the 500 billion infrastructure spending plan proposed by the CDU leader Friedrich Merz.
Market sentiment was also cautious amid escalating trade tensions with the U.S., and the Trump administration said it plans to slap additional tariffs on European steel, automobiles, and other manufactured products.
The tit-for-tat tariffs are likely to provide additional headwinds for eurozone economic growth, and the currency union is already struggling under high cost of living and weak exports growth.
On the economic front, industrial output in the eurozone in January was stable compared to a year ago, according to data released by Eurostat.
Europe Indexes and Yields
The DAX index decreased by 0.5% to 22,561.20, the CAC-40 index edged lower 0.3% to 7,963.96, and the FTSE 100 index advanced by 0.03% to 8,542.94.
The yield on 10-year German bonds inched lower to 2.88%, French bonds increased to 3.56%, the UK gilts moved up to 4.68%, and Italian bonds edged higher to 3.94%.
The euro decreased to $1.09; the British pound was lower at $1.29; and the U.S. dollar was lower and traded at 88.20 Swiss cents.
Brent crude increased $0.11 to $71.05 a barrel, and the Dutch TTF natural gas was higher by €0.58 to €42.41 per MWh.
Europe Stock Movers
Deliveroo PLC plunged 6% to 117.0 pence after the food delivery company pushed back its key financial metric timeline by a year to 2026.
The company delivered its first annual profit after gross sales, annual revenue, and average transaction size increased in 2024.
Hugo Boss AG declined 5% to €36.13, and the German fashion company reported a decline in annual net income in 2024.
The company also said sales growth in the year so far has been muted amid cautious consumer sentiment and challenging macroeconomic conditions in the U.S. and China.
Telefonica jumped 1.8% to €4.30 after the Spanish telecommunications company said it has agreed to sell its business in Colombia for $400 million to Millicom Spain.
Hannover Re jumped 1.4% to €276.10, and the reinsurance company reported a significant improvement in its property & casualty insurance portfolio.
IG Group Holding increased 2% to 944.0 pence after the financial derivative trading platform operator reported a 12% increase in revenue in the fiscal third quarter of 2025.
German and French Bond Yields Near 16-Year Highs Amid Spending Plans and Tariff Wars
Bridgette Randall
13 Mar, 2025
London
European markets lacked direction amid escalating trade tensions with the U.S. and geopolitical uncertainties.
Benchmark indexes in Frankfurt and Paris turned lower as investors reviewed the latest political development in Germany.
The two leading German parties, CDU and SPD, lacking a clear majority, are struggling to form a coalition with the Green Party and prepare a plan to increase the federal government debt limit to finance infrastructure spending.
So far, the Green Party has rejected the government's proposal to raise the debt limit to finance the 500 billion infrastructure spending plan proposed by the CDU leader Friedrich Merz.
Market sentiment was also cautious amid escalating trade tensions with the U.S., and the Trump administration said it plans to slap additional tariffs on European steel, automobiles, and other manufactured products.
The tit-for-tat tariffs are likely to provide additional headwinds for eurozone economic growth, and the currency union is already struggling under high cost of living and weak exports growth.
On the economic front, industrial output in the eurozone in January was stable compared to a year ago, according to data released by Eurostat.
Europe Indexes and Yields
The DAX index decreased by 0.5% to 22,561.20, the CAC-40 index edged lower 0.3% to 7,963.96, and the FTSE 100 index advanced by 0.03% to 8,542.94.
The yield on 10-year German bonds inched lower to 2.88%, French bonds increased to 3.56%, the UK gilts moved up to 4.68%, and Italian bonds edged higher to 3.94%.
The euro decreased to $1.09; the British pound was lower at $1.29; and the U.S. dollar was lower and traded at 88.20 Swiss cents.
Brent crude increased $0.11 to $71.05 a barrel, and the Dutch TTF natural gas was higher by €0.58 to €42.41 per MWh.
Europe Stock Movers
Deliveroo PLC plunged 6% to 117.0 pence after the food delivery company pushed back its key financial metric timeline by a year to 2026.
The company delivered its first annual profit after gross sales, annual revenue, and average transaction size increased in 2024.
Hugo Boss AG declined 5% to €36.13, and the German fashion company reported a decline in annual net income in 2024.
The company also said sales growth in the year so far has been muted amid cautious consumer sentiment and challenging macroeconomic conditions in the U.S. and China.
Telefonica jumped 1.8% to €4.30 after the Spanish telecommunications company said it has agreed to sell its business in Colombia for $400 million to Millicom Spain.
Hannover Re jumped 1.4% to €276.10, and the reinsurance company reported a significant improvement in its property & casualty insurance portfolio.
IG Group Holding increased 2% to 944.0 pence after the financial derivative trading platform operator reported a 12% increase in revenue in the fiscal third quarter of 2025.
U.S. Movers: Adobe, American Eagle Outfitters
Scott Peters
13 Mar, 2025
New York City
Adobe Inc. dropped 4% to $420.98 after the graphic design software developer reported results for the fiscal first quarter of 2025 ending in February.
Revenue increased to $5.71 billion from $5.18 billion, net income surged to $1.81 billion from $620 million, and diluted earnings per share rose to $4.14 from $1.36 a year ago.
The company repurchased approximately 7.0 million shares during the quarter.
“Adobe is well-positioned to capitalize on the acceleration of the creative economy driven by artificial intelligence, and we are reaffirming our fiscal 2025 financial targets,” said Shantanu Narayen, chair and CEO.
The company guided second quarter revenue to be between $5.77 billion and $5.82 billion, up from $5.31 billion a year ago, and earnings per share between $3.80 and $3.85, up from $3.49 in the same period in 2024.
For the full year, Adobe estimated revenue to be between $23.30 billion and $23.55 billion, up from $21.51 billion in 2024, and GAAP earnings per share between $15.80 and $16.10, compared to $12.36 a year ago.
American Eagle Outfitters Inc. dropped 5.1% to $10.86 after the specialty apparel retailer reported comparable sales growth in the fiscal fourth quarter of 2024.
Revenue declined to $1.60 billion from $1.68 billion, net income surged to $104.35 million from $6.32 million, and diluted earnings per share jumped to 54 cents from 3 cents a year ago.
Comparable sales advanced 3% in the quarter, with record Aerie comparable growth of 6% and American Eagle comparative growth of 1%.
The company guided for the first quarter of 2025 a revenue decline of “mid-single digits” and operating income to be between $20 million and $25 million, compared to $78 million in the same period last year.
For the full year, the company expects revenue to decline at “low single digits” and operating income to be between $360 million and $375 million, compared to $142 million in 2024.
The apparel retailer repurchased 3.5 million shares for $60 million in the fourth quarter, bringing full-year repurchases to 9.5 million shares for $191 million, and authorized an additional 50 million shares for repurchase.
In addition, the company returned approximately $24 million in cash to shareholders through its quarterly dividend of $0.125 per share, bringing year-to-date cash dividends to $96 million.
Europe Movers: Costain, Deliveroo, Hill & Smith, Hugo Boss, Rheinmetall
Bridgette Randall
13 Mar, 2025
Frankfurt
Costain Group Plc. dropped 4.1% to 106.90 pence after the UK-based provider of infrastructure solutions reported lower revenue in fiscal 2024.
Revenue declined to £1.25 billion from £1.33 billion, profit jumped to £30.6 million from £22.1 million, and diluted earnings per share edged up to 11.1 pence from 7.8 pence a year ago.
The company proposed a final dividend of 2.0 pence per share for 2024, up from 0.8 pence in 2023, payable on May 29 to shareholders on record as of April 22.
The total dividend per share for the year after the final dividend will increase to 2.4 pence, compared to 1.2 pence in 2023.
Hill & Smith Plc. surged 8.9% to 1,884 pence after the UK-based provider of sustainable infrastructure and transport reported increased revenue in 2024.
Revenue jumped 3% to £855.1 million from £829.8 million, profit rose to £84.3 million from £68.8 million, and diluted earnings per share rose to 93.9 pence from 85.0 pence a year ago.
The company proposed a 14% increase in the final dividend to 32.5 pence per share, payable on July 4 to shareholders on the register as of May 30.
After the final dividend, the total dividend for the year is 49 pence per share, up from 43 cents per share in 2023.
The company paid a total of £34.5 million in dividends during 2024, up from £28 million in 2023.
Hill & Smith said that it is “confident of another year of good progress in 2025,” driven by its proven M&A strategy, and seeing attractive growth opportunities in its business in India.
“Our US businesses delivered around 76% of group underlying operating profit in 2024 and we expect the strong trading momentum to continue in 2025,” as the overall market’s trade tensions do not pose any significant threats, the company said in a release to investors.
Rheinmetall AG surged 9.6% to €1,265 after the German armored vehicle, weapon, and ammunition maker reported increased revenue in fiscal 2024.
Revenue jumped 36% to €9.75 billion from €7.18 billion, operating income climbed 61% to €1.48 billion from €918 million, and earnings per share rose to €16.51 from €12.32 a year ago.
Sales in the defense business, which accounts for around 80% of group sales, increased by 50% during the year.
The company proposed a dividend of €8.10 per share, compared to €5.70 per share in 2023.
Rheinmetall guided for fiscal 2025 group sales to grow between 25% and 30% and the operating margin to be approximately 15.5%, compared to 15.2% in 2024.
In the defense business, the company estimated sales growth between 35% and 40% in 2025.
“This outlook does not yet take into account the improvement in market potential that is expected to arise in the markets that are particularly relevant for Rheinmetall in Europe, Germany, and Ukraine as a result of the geopolitical developments in recent weeks,” the company said in a release to investors.
Deliveroo Plc. dropped 7.1% to 115.74 pence despite the food and retail products delivery platform operator reporting sales growth in fiscal 2024.
Revenue increased to £2.07 billion from £2.03 billion, profit edged up to £2.9 million from a loss of £31.8 million, and diluted earnings per share were zero compared to a loss of 1 cent a year ago.
Sales in the U.K. and Ireland rose to £1.25 billion from £1.21 billion, and international sales declined to £817.5 million from £821.0 million a year earlier.
Total orders increased 2% to 296 million from 290 million, and average order size rose 3% £25.1 from £24.30 a year ago, respectively.
During the year, the company purchased 22.6 million shares for a total of £30 million, including transaction costs of £0.2 million, and held by the earnings before tax.
The company announced a new stock repurchase commenced in August 2024 to purchase for a maximum of £150 million.
During the year, 61.1 million shares were purchased for £90.0 million, including transaction costs of £0.6 million, and 60 million of these shares were cancelled at a cost of £88.5 million and a nominal value of £0.3 million.
Deliveroo guided fiscal 2025 adjusted EBITDA to be between £170 million and £190 million, compared to £130 million in 2024, as the company makes targeted investments to capture future growth opportunities.
The growth in transaction value is expected to increase at “a high single digit” in 2025.
Hugo Boss AG dropped 2.2% to €37.16 despite the German clothing, leather goods, and accessories retailer reporting higher sales in fiscal 2024.
Sales increased to €4.31 billion from €4.20 billion, net income edged down to €225.95 million from €242.53 million, and earnings per share fell to €3.09 from €3.74 a year ago.
The company paid a dividend of €1.40 per share, up from €1.35 per share in 2023.
Hugo Boss guided for fiscal 2025 sales to range between €4.2 billion and €4.4 billion, a 2% increase or decrease said from last year, and EBIT is expected to reach €380 to €440 million euros, up 5% to 22% from €360.82 million in 2024.
Europe Movers: Costain, Deliveroo, Hill & Smith, Hugo Boss, Rheinmetall
Bridgette Randall
13 Mar, 2025
Frankfurt
Costain Group Plc. dropped 4.1% to 106.90 pence after the UK-based provider of infrastructure solutions reported lower revenue in fiscal 2024.
Revenue declined to £1.25 billion from £1.33 billion, profit jumped to £30.6 million from £22.1 million, and diluted earnings per share edged up to 11.1 pence from 7.8 pence a year ago.
The company proposed a final dividend of 2.0 pence per share for 2024, up from 0.8 pence in 2023, payable on May 29 to shareholders on record as of April 22.
The total dividend per share for the year after the final dividend will increase to 2.4 pence, compared to 1.2 pence in 2023.
Hill & Smith Plc. surged 8.9% to 1,884 pence after the UK-based provider of sustainable infrastructure and transport reported increased revenue in 2024.
Revenue jumped 3% to £855.1 million from £829.8 million, profit rose to £84.3 million from £68.8 million, and diluted earnings per share rose to 93.9 pence from 85.0 pence a year ago.
The company proposed a 14% increase in the final dividend to 32.5 pence per share, payable on July 4 to shareholders on the register as of May 30.
After the final dividend, the total dividend for the year is 49 pence per share, up from 43 cents per share in 2023.
The company paid a total of £34.5 million in dividends during 2024, up from £28 million in 2023.
Hill & Smith said that it is “confident of another year of good progress in 2025,” driven by its proven M&A strategy, and seeing attractive growth opportunities in its business in India.
“Our US businesses delivered around 76% of group underlying operating profit in 2024 and we expect the strong trading momentum to continue in 2025,” as the overall market’s trade tensions do not pose any significant threats, the company said in a release to investors.
Rheinmetall AG surged 9.6% to €1,265 after the German armored vehicle, weapon, and ammunition maker reported increased revenue in fiscal 2024.
Revenue jumped 36% to €9.75 billion from €7.18 billion, operating income climbed 61% to €1.48 billion from €918 million, and earnings per share rose to €16.51 from €12.32 a year ago.
Sales in the defense business, which accounts for around 80% of group sales, increased by 50% during the year.
The company proposed a dividend of €8.10 per share, compared to €5.70 per share in 2023.
Rheinmetall guided for fiscal 2025 group sales to grow between 25% and 30% and the operating margin to be approximately 15.5%, compared to 15.2% in 2024.
In the defense business, the company estimated sales growth between 35% and 40% in 2025.
“This outlook does not yet take into account the improvement in market potential that is expected to arise in the markets that are particularly relevant for Rheinmetall in Europe, Germany, and Ukraine as a result of the geopolitical developments in recent weeks,” the company said in a release to investors.
Deliveroo Plc. dropped 7.1% to 115.74 pence despite the food and retail products delivery platform operator reporting sales growth in fiscal 2024.
Revenue increased to £2.07 billion from £2.03 billion, profit edged up to £2.9 million from a loss of £31.8 million, and diluted earnings per share were zero compared to a loss of 1 cent a year ago.
Sales in the U.K. and Ireland rose to £1.25 billion from £1.21 billion, and international sales declined to £817.5 million from £821.0 million a year earlier.
Total orders increased 2% to 296 million from 290 million, and average order size rose 3% £25.1 from £24.30 a year ago, respectively.
During the year, the company purchased 22.6 million shares for a total of £30 million, including transaction costs of £0.2 million, and held by the earnings before tax.
The company announced a new stock repurchase commenced in August 2024 to purchase for a maximum of £150 million.
During the year, 61.1 million shares were purchased for £90.0 million, including transaction costs of £0.6 million, and 60 million of these shares were cancelled at a cost of £88.5 million and a nominal value of £0.3 million.
Deliveroo guided fiscal 2025 adjusted EBITDA to be between £170 million and £190 million, compared to £130 million in 2024, as the company makes targeted investments to capture future growth opportunities.
The growth in transaction value is expected to increase at “a high single digit” in 2025.
Hugo Boss AG dropped 2.2% to €37.16 despite the German clothing, leather goods, and accessories retailer reporting higher sales in fiscal 2024.
Sales increased to €4.31 billion from €4.20 billion, net income edged down to €225.95 million from €242.53 million, and earnings per share fell to €3.09 from €3.74 a year ago.
The company paid a dividend of €1.40 per share, up from €1.35 per share in 2023.
Hugo Boss guided for fiscal 2025 sales to range between €4.2 billion and €4.4 billion, a 2% increase or decrease said from last year, and EBIT is expected to reach €380 to €440 million euros, up 5% to 22% from €360.82 million in 2024.
Expectations of Higher Rates In Japan Kept Tokyo Market Sentiment In Check
Akira Ito
13 Mar, 2025
Tokyo
Market sentiment in Tokyo dampened amid rapidly escalating trade tensions with the U.S., and the yen continued its advance.
The Nikkei 225 Stock Average edged down a fraction, and the broader TOPIX advanced 0.1% as investors worried about the looming U.S. trade tariffs.
The yen closed at 147.5 against the U.S. dollar after Bank of Japan Governor Kazuo Ueda reaffirmed the central bank's plans to shrink its balance sheet.
The central bank is prepared to raise rates following strong wage growth and rising consumption, permitting policymakers to end long-overdue ultra-loose monetary policy.
Japanese exporters are bracing for higher U.S. tariffs on electrical and electronic goods, vehicles, and semiconductor equipment as the Trump administration expands the list of countries and industries.
Japan Indexes and Stocks
The Nikkei 225 Stock Average closed down 0.1% to 36,790.03, and the broader TOPIX edged up 0.1% to 2,698.36, and both indexes erased the session's gains.
Mitsubishi Electric Corp. increased 1.3% to ¥2,757.0, and the company said it plans to expand its missile and cross-domain operations as Japan expands its arms production and defense capabilities.
Semiconductor equipment makers were in focus in Tokyo's trading, following a rebound in advanced chipmaker stocks in New York in overnight trading.
Tokyo Electron decreased 0.1% to ¥21,320.0, Disco Corp. soared 5.2% to ¥34,430.0, and Advantest Corp. jumped 3.7% to ¥7,830.0.
Japan Steel Works soared 6.2% to ¥5,933.0, despite the looming U.S. tariffs on Japanese exports.
Kawasaki Heavy Industries gained 1.9% to ¥8,870.0, and IHI Corp. increased 2.9% to ¥10,605.0 amid expectations of rising orders from the defense ministry as the Japanese government plans to spend about 44 trillion yen on modernizing its military.