**EUROPEAN EQUITY COVERAGE WILL ONLY COVER COMPANIES IN THE STOXX 600 OR COMPANIES OF SYSTEMIC IMPORTANCE TO PARTICULAR SECTORS**
31st January 2018
The Daily European Equity Opening News is uploaded at 0700GMT/0100CST recapping all of the overnight equity news
From 0700GMT/0100CST all equity news will be covered in real time over the audio and headline feed and the full audio rundown will be at 0715GMT/0115CST.
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
A mixed tone was gradually seen in Asia, as equity markets somewhat recovered from the initial spill-over selling from Wall St. where the S&P 500 posted its worst 2-day performance since May last year. The overnight rebound in sentiment was alongside President Trump’s first State of the Union Address, which Trump was viewed to have delivered a composed and conventional speech, while he also refrained from any comments that would have unnerved markets. As such, ASX 200 (+0.2%) pared early losses and finished positive, although the commodity-related sectors continued their underperformance, while Nikkei 225 (-0.4%) swung between gains and losses with Japanese stock news dominated by earnings. Furthermore, the region also mulled over mixed Chinese Official PMI data in which Non-Manufacturing PMI topped estimates but Manufacturing PMI disappointed, which in turn clouded over the Shanghai Comp. (-0.6%) and Hang Seng (+0.1%), despite a brief turnaround which momentarily saw most stocks lifted with the tide.
RBS (RBS LN) – The UK FCA says it will issue a full report on RBS Global Restructuring group once consent is received from cited individuals. Co.’s restructuring business did not turn around the “vast majority” of small businesses it worked with according to CEO. (Newswires)
Royal Dutch Shell (RDSA LN) – Co. announces that it will sell its stake in the Bongkot gas field in Thailand for USD 750mln. (Newswires)
OTHER UK COMPANIES
Britain’s Automobiles – Car production fell last year for the first time since 2009. Investments also slumped by a third as the looming uncertainty over Brexit cut domestic demand and companies’ new spending plans. (Newswires)
Siemens (SIE GY) – Co. reported Q1 revenue +3% to EUR 19.82bln vs. Exp. EUR 19.9bln. Q1 orders +14% to EUR 22.5bln vs. Exp. 20.8bln. Co. also reiterates outlook expected profit margin of 11% to 12% for the industrial business, EPS of EUR 126.96.36.199. Furthermore Co. stated that the US tax reform bill results in Q1 showed a positive effect of EUR 437mln. (Newswires)
Infineon (IFX GY) – Q1 revenue EUR 1.78bln vs. Exp. EUR 1.79bln, Q1 EPS EUR 0.20 vs. Exp. EUR 0.21; cuts FY 2018 revenue and segment margin targets. (Newswires
OTHER GERMAN COMPANIES
OTHER FRENCH COMPANIES
JC Decaux (DEC FP) – Q4 Adj. revenue up 3.6% to EUR 1.018bln, while Adj. organic revenue rose 6.5%. (Newswires)
CARREFOUR (CA FP) UPGRADED TO ADD FROM REDUCE AT ALPHAVALUE
Ontex Group (ONTEX BB) – Q4 guidance like for like revenues up 7.2%. (Newswires)
Santander (SAN SM) – Co. reports Q4 Net profit at EUR 1.54bln vs. Exp. 1.46bln. FY net interest income rose 10.3% to EUR 34.30bln. Q4 net interest income EUR 8.61bln. Return on tangible equity (ROTE) 10.41% in Q4. Co. also states that it remains confident it will achieve all targets. (Newswires)
ArcelorMittal (MT NA) – Q4 2017 Revenue USD 17.7bln vs Exp. USD 17.7bln. Co. proposes dividend policy starting at USD 0.10 per share in 2018. (Newswires)
KPN (KPN NA) – Co. reports Q4 Adj. EBITDA EUR 596mln vs. Exp. EUR 610mln. Q4 Net profit EUR 70mln vs. Exp. 109mln. Q4 revenues of EUR 1.61bln vs EUR 1.65bln. Co. expects additional cashflow via dividends from stake in Telefonica for FY 2018. (Newswires)
ING (ING NA) – Q4 pre-tax profit of EUR 1.56bln vs. exp. EUR 1.67bln, total underlying income EUR 4.37bln vs. Exp. EUR 3.36bln, interest result EUR 3.5bln vs. Exp. EUR 3.39bln, CET1 ratio 14.7% vs. Exp. 14.5%. (Newswires)
Lonza (LONN SW) – Co. reported a higher-than-expected 81% rise in its core 2017 profit. Core profits printed at CHF 806mln vs Exp. 674mln. Sales rose 23.5% to CHF 5.1bln vs. Exp. CHF 5.1bln. (Newswires)
Julius Baer Gruppe AG (BAER SW) – the co. reports adjusted net profit of CHF 806mln vs. exp. CHF 810mln. Assets under management CHF 388bln vs. exp. CHF 397bln. IFRS net profit attributable to shareholders CHF 705mln and proposes dividend of CHF 1.40/shr. Separately, the bank announces Brazil acquisition. (Newswires)
AMS SW (AMS SW) UPGRADED TO BUY FROM ADD AT ALPHAVALUE
Electrolux (ELUXB SS) – The co. is to invest USD 500mln in US Production and will cease production at its Saint Cloud Minnesota Facility. (Newswires)
Volvo (VOLVB SS) – Q4 2017 revenue SEK 91.7bln vs Exp. SEK 89.7bln. Adj. operating profit SEK 7.33bln vs. Exp. 7.29bln. (Newswires)
Ericsson (ERICB SS) – Co. reports Q4 2017 revenue SEK 57.2bln vs. Exp. SEK 58.2bln. operating loss of SEK 19.8bln vs. Exp. loss of SEK 17.3bln, Adj. operating income SEK 0.4bln vs. Exp. SEK 1.68bln. (Newswires)
Telenor (TEL NO) – Q4 revenue NOK 32.1bln vs. Exp. NOK 32.1bln, adj. EBITDA NOK 11.8bln vs. Exp. NOK 11.9bln and net NOK 2.23bln vs. Exp. NOK 3.43bln. (Newswires)
Elisa (ELISA FH) – EBITDA EUR 151mln vs. EUR 148mln, Q4 revenue EUR 473mln vs. Prev. Y/Y EUR 434mln. (Newswires)
EQUITIES: S&P 500 -1.09% at 2822, Nasdaq100 -0.82% at 6931 and DJIA -1.38% at 26075
Top sectors: Utilities +0.17%, Telecoms -0.01% and Consumer Discretionary -0.54%
Bottom sectors: Healthcare -2.11%, Energy -2.02% and Financials -1.23%
Month-end equity models were said to favour equity-selling and bond-buying following the series of record gains printed in January. Additionally, analysts were noting that the recent quick rise in yields may not be playing a role in the equity weakness see over the last couple of days.
But there were stock specific stories for traders to sink their teeth into: the healthcare sector was slammed after Amazon, Berkshire Hathaway and JPMorgan announced a venture aimed at reducing healthcare costs.
Insurer MetLife took a hit from the healthcare news, but was hammered after it said it was placed under an SEC investigation to pay pensions to around 600k customers. The company also said its reserves were not as large as analysts had expected, and would raise those reserves by circa 550mln USD.
In earnings, Pfizer fell after its earnings, as did Harley Davidson. Meanwhile, in tech, continued fears that Apple would cut iPhoneX production – possibly due to its staggering price which CNBC says has scared buyers – pressured the companies shares.
After-market earnings highlights include AMD, Chubb and EA