2023-11-24 07:03:00
Last session of the week, a session which promises to be calm since Wall Street was closed yesterday and will only open for half a session today (the closing will take place at 1:00 p.m. local time, i.e. 7:00 p.m. Central European Time). The stock markets remain well oriented so barring any accident, they will close a new bullish weekly sequence, especially since this time of year which separates Thanksgiving from Christmas is traditionally favorable for stock indices.
Even if it is difficult to admit, we must face the facts, without Wall Street, stock market sessions are not very captivating. The European markets continued yesterday to retrace the path lost since August, but the progressions remained modest, ranging between +0.18% for the Swiss SMI and +0.63% for the OMX Nordic. Between these two limits, our national CAC40 increased by 0.24%, a bit like the German DAX (+0.23%). I’m talking about a lost path but let’s still note that the Paris stock market has increased by 12.50% since January 1, +15.50% for its dividends reinvested version (you will find it on zonebourse by typing the code PX1GR in our search engine ). This is also much better than the broad Stoxx Europe 600 Net Return index, which still increased by around 11% over the same period of time.
This good run of the stock markets is fueled by a renewed appetite for risk among investors, who believe that the Federal Reserve will exchange its disguise of whipping father for that of Santa Claus by exchanging rate increases for rate cuts, the first of which should arrive somewhere in 2024, all this without having completely ruined the economic dynamic. I won’t repeat the whole story here, but I would like to point out that a rate cut is synonymous with more money in circulation, synonymous with more investment, synonymous with an increase in risky assets, synonymous with an upturn. actions. In any case, this is part of the blue sky scenario of a soft landing so hoped for by financiers.
And the European Central Bank in all this? It’s pretty much the same, minus the growth. The ECB’s latest minutes, revealed yesterday, reinforce the feeling of financiers that the current phase of monetary tightening will soon end. The ECB has in fact given some signals suggesting that it is concerned about growth prospects, which are clearly oriented downwards while at the same time, the transmission belt of its policy seems to be bearing fruit since disinflation is taking hold. in place. In other words, even if the ECB wishes to anchor investors’ expectations towards a monetary policy that will remain restrictive, its hands are tied to justify further rate increases.
This serves as a transition for me to move on to the macro level, which is entirely organized around the flash PMIs for the month of November. Unsurprisingly, the latter continue to deteriorate but in a less pronounced manner than in October. We remain in the contraction zone but a contraction that doesn’t get worse is better than nothing. To use the words of ING economists, the euro zone is facing a “shallow technical recession” and this is totally in line with investors’ “soft landing” scenario.
In the rest of the news, the OPEC+ soap opera continues. After postponing the next meeting for 4 days, it will not take place physically in Vienna as planned, but online, virtually. Should we conclude that differences are increasing? I don’t think so but in any case oil is taking the hit and losing ground. The news of the day is also the start of the truce between Israel and Hamas in the Gaza Strip. On a completely different note, Binance, the largest cryptocurrency platform in the world, was ordered to pay a total of $4.3 billion in fines for violating American anti-money laundering laws. His boss is forced to resign. You will find more information on this affair here from the writing of my colleague Laurent Pignot.
For their last session of the week, the Asia Pacific markets are on course to end in disorganized order. The increase prevails in Japan (+0.52%) and Australia (+0.17%), while China returns to the path of decline, whether in Hong Kong (-1.70%) or in Shanghai (-0.58%). The Sensex is moving around equilibrium as I write these lines. In Europe, leading indicators are moving slightly downward, unable to adjust to Wall Street’s close.
Today’s economic highlights
After the flash PMIs for the month of November in Europe, it’s time for the United States with the manufacturing and services PMIs which are on the program at 3:45 p.m. Before that, we will read the German Ifo in the morning, at 10:00 precisely. The whole agenda here.
The euro stands still at 1.0909 USD. The ounce of gold is close to the 2000 USD line. Oil is stabilizing, with North Sea Brent at USD 81 per barrel and American WTI light crude at USD 76.30. The performance of the American debt over 10 years reaches 4.478%. Bitcoin is trading around $37,400.
The main changes in recommendations
Adyen NV: Goldman Sachs maintains its buy recommendation and increases the price target from 1150 to 1425 EUR.Ahold Delhaize NV: Barclays maintains its market weighting recommendation and reduces the price target from 32 to 30 EUR.Bankinter , SA: Citigroup maintains its buy recommendation with a price target raised from 8.60 to 8.80 EUR.BMW Ag: Barclays maintains its recommendation to underweight with a price target reduced from 92.50 to 85 EUR.Compagnie Financiere Richemont: Barclays maintains its recommendation to overweight with a price target reduced from 172 to 161 CHF. Continental Ag: Barclays moves from market weighting to overweight with a price target raised from 70 EUR to 90 EUR. De’Longhi SPA: Oddo BHF starts monitoring at neutral with a price target of 30 EUR. Deutsche Telekom Ag: Morgan Stanley maintains its overweight recommendation and raises the price target from 27 to 27.50 EUR. Equinor Asa: ABG Sundal Collier maintains its buy recommendation and reduces the price target from 450 to 430 NOK.Evonik Industries Ag: Stifel improves its recommendation from keep to buy with a price target of 20 EUR.Ferrari NV: Barclays maintains its recommendation to overweight and raises the price target from 350 to 375 EUR.Forvia: Barclays goes from underweight to overweight with a price target raised from 20 to 24 EUR.Fresenius Medical Care Ag & Co. Kgaa: HSBC goes from reduce to hold with a price target raised from 38 EUR to 39 EUR.Galapagos Nv: Citigroup remains neutral with a price target reduced from 41 to 35 EUR.Hellofresh Se: Landesbank Baden-Wuerttemberg moves from hold to buy with a price target of 17 EUR.Indivior Plc : Jefferies remains a buy with a price target reduced from 2555 to 2165 GBX.Laboratorios Farmaceuticos Rovi, SA: Jefferies remains a buy with a price target raised from 60 to 66 EUR.Linde Plc: HSBC maintains its recommendation purchase with a price target raised from 440 to 447 USD.Mercedes-Benz Group Ag: Barclays goes from overweight to market weighting with a price target reduced from 85 to 60 EUR.Michelin: Barclays goes from overweight to underweight with a price target reduced from 36 EUR to 3Porsche Automobil Holding Se: Barclays moves from overweight to market weighting with a price target reduced from 58 EUR to 50 EUR.Siemens Ag: Citigroup maintains its outperformance recommendation and reduces the target price price from 169 to 166 EUR.Soitec: Bernstein maintains its outperformance recommendation and reduces the price target from 200 EUR to 190 EUR.Valeo: Barclays maintains its market weighting recommendation with a price target reduced from 18 to 16 EUR .Vivendi Se: Citigroup maintains its outperformance recommendation and reduces the price target from 13.50 EUR to 13 EUR.
In France
Important (and not so important) announcements
Saint-Gobain’s number two, Benoît Bazin, will take the helm of the group in June. Eiffage wins the construction of a section of motorway in Norway for 234 million euros. Stellantis will raise its revenue target for its recycling unit “circular economy” according to Carlos Tavares. Thales wins a contract to supply a public transport system in Egypt. Safran inaugurates its photovoltaic power plant in Normandy Icade finalizes the sale of the Grand Central building in Marseille. Fitch downgrades Eutelsat Communications after merger with OneWebEquasens and Arz Haan buy German pharmacy software group Apotheken Datenverarbeitung.Amplitude Surgical achieves consolidated revenue of 20.5 million euros for its 1st quarter, in growth of 7%.2CRSi signs $2 million contract with an American AI startup.
In the world
Important (and not so important) announcements
Nvidia delays launch of new AI chip for China. Amazon employees plan mobilizations in Europe for Black Friday. Eni plans a $10 billion investment in an offshore field in Ivory Coast. Glencore is examining the relocation of its battery recycling project. Barclays prepares £1 billion savings plan. Endesa to cease coal operations by 2027. Aixtron is building a €100 million research center in Germany. Juventus shareholders approve the 200 million euro capital increase and share consolidation.Nissan will manufacture electric versions of Juke and Qashqai in England according to the Financial Times.
Main publications of the day : H Wolrd GroupElia Group, Cathay Pacific Airways… All the agenda here.
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