>>> What to look at today - 31st of July 2024

Japanese stocks reversed losses and the yen fluctuated as traders digested the Bank of Japan’s interest-rate increase and reduction in bond purchases.  The BOJ raised rates to around 0.25%, flagged as a possibility in a report by broadcaster NHK, and said it would reduce its monthly pace of bond buying to around ¥3 trillion ($19.6 billion) in the first quarter of 2026. Japanese government bonds trimmed losses as analysts had expected a more aggressive reduction. The Nikkei 225 index was up 0.2% while the yen swung between gains and losses.  The decision will send ripples across global financial markets given the yen’s status as a major carry trade currency. As traders await BOJ Governor Kazuo Ueda’s press briefing in the afternoon for details, the rest of Asia is seeing big moves given a slew of economic data, key earnings, and positioning ahead of the Federal Reserve’s decision due later Wednesday.  Elsewhere, the Australian dollar fell and short-term bonds rallied after core inflation unexpectedly decelerated last quarter, prompting traders to boost bets on an interest-rate cut by the Reserve Bank. Chinese stocks jumped as anticipation grew for Beijing to enhance support for its struggling economy. US equity futures advanced with expectations that Chair Jerome Powell may signal a potential rate cut in September.   Yields on Australia’s policy sensitive three-year government bonds declined as much as 25 basis points.  South Korea’s Kospi Index climbed, buoyed by gains in Samsung Electronics Co. after the chipmaker reported its fastest pace of profit growth since 2010. Shares in mainland China and Hong Kong rallied as more signs of slowing growth spurred bet on stronger support measures from Beijing.  Treasury yields stabilized after falling in the previous four sessions. A Bloomberg gauge of dollar strength edged lower.  In commodities, oil extended gains after Hamas said Israel killed its political leader, stoking tensions in a region that produces around a third of the world’s crude. Overnight in the US, the world’s largest technology companies extended losses in US late hours as Microsoft Corp.’s results fueled concern the artificial-intelligence frenzy might have gone too far. A rotation out of big tech has dragged the Nasdaq 100 down 9% from its all-time high — leaving it on the cusp of a correction. The S&P 500 fell to around 5,435 on Tuesday. The Nasdaq 100 slid 1.4%. A gauge of the “Magnificent Seven” megacaps sank 2%. The Russell 2000 of small firms rose 0.3%. Nvidia Corp. tumbled 7%, wiping $193 billion from its market value.  If the Fed is about to begin a rate cutting cycle, stock bulls have history on their side. In the six prior hiking cycles, the S&P 500 has risen an average 5% a year after the first cut, according to calculations by the financial research firm CFRA. What’s more, the gains also broadened, with the small-cap Russell 2000 Index climbing 3.2% 12 months later, the data show. US After Hours AMD +7.4%, FRSH +5.4%, SBUX +5.3%, ANET +2.3%, FSLR +2.2% higher on earnings; LMND -16.8%, OI -15.2%, PINS -11.6%, MSFT -3.1% lower on earnings

Nikkei +0.14% Hang Seng +2.01% CSI +1.97% Shanghai +1.79% Shenzen +2.89%

Eur$ 1.0850 CNH 7.2413 CNY 7.2366 JPY 152.95 GBP 1.2843 CHF 0.8823 RUB 86.0589 TRY 33.1374 WTI$76.15 Gold 2,419 BTC 66,110 ETH 3,302

S&P +0.54% Nasdaq +1.10% EuroStoxx +0.92% FTSE +0.46% Dax +0.54% SMI +0.27%

Macro :
- Israel Strikes Beirut in Attack Against Hezbollah Commander
- Hamas Says Israel Killed Political Leader Haniyeh in Iran (2)
- US to Exclude Japan, S.Korea in New China Chip Exports Rule:Rtrs
- Hamas Says Israel Killed Political Leader Haniyeh in Iran (2)

Keep an eye on :
- ADS GY : Adidas 2Q Gross Profit Meets Estimates
- AED BB : Aedifica Boosts FY EPRA EPS Forecast, Beats Estimates
- AENA SM : Aena 1H Net Income Beats Estimates
- AIR FP : Airbus profits more than halve on extra charges in space business
- AMS SM : Amadeus 2Q Revenue Matches Estimates
- AMD US : AMD Shares Rise After 2Q Adj EPS, Revenue Beat Estimates
- AG1 GY : AUTO1 Boosts FY Adjusted Ebitda Forecast, Beats Estimates
- BBVA SM : BBVA Creates Three New Units Under CEO Genc
- BBVA SM :BBVA 2Q Net Income Beats Estimates (1)
- BOL SM : Bollore 1H Ebita EU619M Vs. EU462M Y/y
- ALBIO FP : AMF Fines Biosynex, CEO and Several Directors €930,000
- BMW GY : Aisin, BMW Agree on E-Axle Production Partnership
- CABK SM : CaixaBank Boosts FY Return on Tangible Equity Forecast (1)
- CO FP : Casino 1H Neg Adj Free Cash Flow €413M Vs. Neg €735M Y/y
- CCR LN : Engine Capital Nominates Two Candidates to C&C Group’s Board
- COL SM : Inmobiliaria Colonial 1H Recurring Net Income Beats Estimates
- COTN SW : Comet 1H Sales CHF189.3M Vs. CHF207.0M Y/y
- BN FP : *DANONE 2Q LIKE-FOR-LIKE SALES +4%, EST. +3.8%
- DBV FP : DBV Tech 2Q Revenue Misses Estimates
- DEEZR FP : Deezer 1H Net Loss EU19.4M Vs. Loss EU38.4M Y/y
- EDP PL : EDP SA 1H Net Income EU762M Vs. EU437M Y/y, EDP Reaffirms It Expects ~€300m of Asset Rotation Gains/Year
- E2N GY : GSK 2Q Adjusted EPS Beats Estimates
- EAPI FP : EuroAPI 1H Core Ebitda Beats Estimates
- FRE GY : Fresenius SE 2Q Ebit Before Special Items Beats Estimates
- GLEN LN : Ex-Glencore Oil Boss Exits Board of Investment Firm He Founded
- GSK LN :
- HSBA LN : HSBC 2Q Pretax Profit Beats Estimates (2)
- IFCN SW : Inficon Narrows FY Sales Forecast, Misses Estimates
- INTC US : Intel to Cut Thousands of Jobs to Reduce Costs, Fund Turnaround
- INW IM : INWIT 2Q Revenue Meets Estimates
- JDEP NA : JDE Peet's 1H Organic Revenue Beats Estimates
- TKWY NA : Just Eat Takeaway Earnings Beat Estimates After Cost Controls
- KGX GY : Kion Narrows FY Adjusted Ebit Forecast
- LI FP : Klepierre Boosts FY Group NCCF/Shr Forecast
- KRN GY : Krones 2Q Ebitda Meets Estimates
- OR FP : L'Oreal 2Q North Asia Comparable Sales Misses Estimates
- LR FP : Legrand 1H Adjusted Operating Profit Meets Estimates
- LMND US : Lemonade 3Q Revenue Forecast Misses Estimates
- LDO IM : Leonardo Electronics Prospects Rise on Military Spending: React
- LHA GY : Lufthansa 2Q Adjusted Ebit Margin Beats Estimates
- MWB LN : Takeover Panel Bans 10 From London Mergers in Rare Cold Shoulder
- MELE BB : Melexis 2Q Gross Margin Matches Estimates
- MSFT US : Microsoft Slips After 4Q Cloud Revenue Falls Short: Street Wrap
- NEM GY : Nemetschek 2Q Ebitda Misses Estimates
- NOKIA FH : Amazon Sues Nokia Alleging Patent Infringement: Reuters
- NDX1 GY : Nordex Gets Follow-Up Order in Spain From Aquila Clean Energy
- OMV AV : OMV 2Q Net Misses Estimates, Books New Pipeline Capacity (1)
- ONTEX BB : Ontex Boosts FY Adjusted Ebitda Margin Forecast (2)
- PHM SM : Pharma Mar 1H Net Income EU3.54M Vs. EU6.44M Y/y
- 1913 HK : Prada Shares Jump in Hong Kong; Sales Beat Estimate: Street Wrap
- RIO LN : Rio Tinto’s Half-Year Profit Edges Higher Despite China Woes (2)
- ROVI SM : Rovi 1H Net Income EU44.3M Vs. EU66.6M Y/y
- SAF FP : Safran 1H Adj Recurring Oper Margin Beats Estimates
- SU FP : Schneider Electric Boosts FY Adj. Ebita Organic Growth Forecast
- SHL GY : Siemens Healthineers 3Q Adjusted Ebit Misses Estimates
- SOLB BB : Solvay 2Q Underlying Ebitda Beats Estimates
- SON PL : Sonae 1H Net Income EU75M Vs. EU66M Y/y
- STLA US : Stellantis Offers US Employees Buyouts in New Round of Job Cuts
- STLA US : Stellantis ‘Restates Unwavering Commitment’ to Maserati
- SCMN SW : Swisscom 2Q Ebitda Matches Estimates
- SNBM SW : SNB Reports Half-Year Profit as Strong Stocks Offset Franc Gains
- TLGO SM : Talgo Rejects Skoda’s Proposal to Combine Companies
- TMV GY : TeamViewer 2Q Adjusted Ebitda Beats Estimates
- TEF SM : Telefonica 2Q Revenue Beats Estimates
- TEF SM : Telefonica is In Talks With Millicom Over Colombian Business
- TEP FP : Teleperformance 1H Adjusted Ebita Meets Estimates
- TEL NO : Telenor Picks Torbjorn Wist of Wallenius Wilhelmsen as New CFO
- TENB US : Cybersecurity Firm Tenable Is Said to Explore Potential Sale
- TGS NO : TGS Launches New Seismic Survey in Seram Basin, Indonesia
- VIRI FP : Viridien 2Q Segment Ebitdas $91M Vs. $104M Y/y
- VIS SM : Viscofan 2Q Net Income Beats Estimates
- VOS GY : Vossloh to Acquire Sateba From TowerBrook for €450m

>>> US After Hours Summary: AMD +7.4%, FRSH +5.4%, SBUX +5.3%, ANET +2.3%, FSLR

After Hours Summary: AMD +7.4%, FRSH +5.4%, SBUX +5.3%, ANET +2.3%, FSLR +2.2% higher on earnings; LMND -16.8%, OI -15.2%, PINS -11.6%, MSFT -3.1% lower on earnings

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: POWL +23.5%, ACEL +17.2%, WGS +12.5% (also announces Whole Genome Sequencing product enhancements), MTCH +7.9%, PCRX +7.5%, AMD +7.4%, FRSH +5.4%, SBUX +5.3%, PRO +4.7%, CZR +4.3%, TFSL +3.6%, NOG +2.7%, PDS +2.6%, ANET +2.3%, FSLR +2.2%, QUAD +2%, NMIH +1.5%, QRVO +1.3%, NWE +1.1%, CP +1.1%, LC +1%, MOD +1%, ACGL +0.8%, MDLZ +0.7%, UNM +0.4% (also authorizes new $1 bln share repurchase program), EA +0.3%, WERN +0.3%, OVV +0.2%, UMBF +0.2%, AXS +0.1%, ZWS +0.1%

Companies trading higher in after hours in reaction to news: VST +13.1% (N.R.C. approves request to extend the operation of Comanche Peak), NVDA +3.9% (in sympathy with strong AMD earnings), PSN +2.1% (to acquire BlackSignal Tech for $200 mln), TECX +1.9% (FDA clears IND application for TX45), VVV +1.9% (authorizes new $400 mln share repurchase program), BIIB +1.2% (BIIB and ESAIY announce latest findings for lecanemab-irmb), CYH +0.9% (to sell three Pennsylvania hospitals), INTC +0.9% (planning to cut thousands of jobs, according to Bloomberg; also in sympathy with AMD earnings), UNM +0.4% (authorizes new $1 bln share repurchase program), FICO +0.3% (authorizes new $1 bln share repurchase program)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: ESS -24.5%, GRPN -17.3%, LMND -16.8%, OI -15.2%, NARI -13.6% (also CFO to retire, names new CFO), PEN -13.2%, PINS -11.6%, AX -9.1%, BXP -8.6%, DH -8.5%, VOYA -7.4%, WTTR -7.1%, ATEN -7%, TEX -6.8%, TX -6.7%, CRK -6.5%, ATRC -5.4%, AROC -4.9%, STAG -4.4%, INFA -4.2%, PSA -4.1%, WU -4%, SWKS -3.9% (also increases dividend), SYK -3.7%, LYV -3.5%, KAI -3.2%, MSFT -3.1%, FE -3%, DENN -2.6%, DV -1.8%, MEOH -1.7%, SW -1.6%, EQH -1.5%, UDR -1.4%, WPC -1.4%, HA -0.8%, EXR -0.7%, EQC -0.4%, CCCS -0.3%

Companies trading lower in after hours in reaction to news: FGEN -46.6% (announces topline results from two late-stage trials), PEPG -25.1% (data from CONNECT1-EDO51 Phase 2 clinical trial), MGNX -21.7% (MGNX achieves $100 mln in milestones from INCY related to progress of ZYNYZ; also provides Vobramitamab Duocarmazine update), FNA -5.4% (select financial statements should no longer be relied upon), SNAP -4.4% (in sympathy with weak PINS earnings), AWK -2.4% (to acquire Yerba Buena's water distribution system), TRVG -1.9% (acquires 30% equity interest in Holisto), META -1.8% (in sympathy with weak PINS earnings), DDOG -1.4% (in sympathy with weak MSFT results), SNOW -1.4% (in sympathy with weak MSFT results), WAL -1.2% (announces exec leadership and organizational structure changes), AMZN -1.2% (in sympathy with weak MSFT results), NRDS -0.7% (commits to a restructuring plan), GOOG -0.3% (in sympathy with weak PINS earnings)

FT : Prada defies luxury slowdown with surging Miu Miu and Japan sales

Prada defies luxury slowdown with surging Miu Miu and Japan sales
Italian group reports double-digit revenue growth despite pressure elsewhere in industry

Italian luxury fashion group Prada defied a broader luxury sector slowdown as it reported double-digit revenue growth in the first half of the year, fuelled by surging sales at its Miu Miu label and a jump in sales in Japan. 

Net revenues increased 17 per cent to €2.6bn year-on year while retail sales rose 18 per cent to €2.3bn, the company said on Tuesday.

Sales at Miu Miu, the group’s brand that targets a younger generation of consumers, continued a strong run, rising 93 per cent year on year. Those at the group’s main Prada brand grew 6 per cent over the same period. 

In regional terms, Japan was the standout performer with retail sales rising 55 per cent. Sales in the wider Asia Pacific region, which includes China but excludes Japan, rose 12 per cent over the period — although the group said growth had slowed in the second quarter of the year against a “backdrop of a tougher comparison base and increasing spending outside the area”.

The Milan-based group’s earnings are a stark contrast to some other recent earnings in the global luxury industry, which is navigating a sharp downturn as consumers rein in spending.

French conglomerates LVMH and Kering last week led a sell-off in global luxury stocks after both groups reported slower than expected sales. Kering, whose flagship Gucci brand continues to struggle, warned investors to expect a weak second half of the year. 

Prada group chair Patrizio Bertelli struck a more optimistic tone, saying he was “satisfied” with the group’s above market performance and “confident” about its ability “to navigate the months ahead” through continued investments in the business. 

There has been a clutch of some positive results in the sector. Paris-based Hermès last week also defied the luxury downturn to grow sales in the double-digits across all regions, although Asia was the exception. Meanwhile Italy’s Moncler and the Zegna Group reported strong performances with revenues rising 11 per cent and 6 per cent respectively.   

Prada has announced large retail investments this year as it counts on customers returning to physical shops. Chief executive Andrea Guerra said Prada and Miu Miu were “capitalising on their unique identity, creativity, and positioning”.

“In the current macroeconomic and geopolitical context, industry dynamics have become more challenging . . . this requires us to be agile and sharp on our product range, communication and overall positioning, to continue to drive client engagement,” he added.

>>> Goldman Sachs David Solomon CNBC interview (492.72)

Goldman Sachs David Solomon CNBC interview (492.72)
Mr. Solomon said:
  • He comes to Paris regularly and France wants to engage business leaders.
  • 1 or 2 Fed rate cuts this year seems more likely.
  • There is no question inflation is having impact on consumer habits even though the rate of increase has declined.
  • M&A activity expected to pick up.
  • Regulatory issues have been a headwind.
  • Prepared to operate in any outcome of presidential election.

>>> US Gapping down

Gapping down
In reaction to earnings/guidance:
  • SYM -20.6%, LSCC -15.4%, WWD -12.7%, SANM -8.6%, AGCO -8.4%, FMS -7.5%, HOLX -7%, RMBS -6.9% (also expands memory interface chip offering), AMKR -6.9%, DEO -6.4%, GLW -5.7%, HEES -5.3%, TRNS -4.6%, PG -4.2%, CECO -3.2%, WSO -2.4%, LTC -2.1%, SBAC -2%, MRK -2%, FLS -1.9%, PHIN -1.8%, CWK -1.6%, RGEN -1.4%, BRX -1.3%, AEP -1.1%, ADM -0.9%
Other news:
  • CLDX -7.1% (topline results from Barzolvolimab Phase 2 study)
  • RNST -6.8% (to acquire The First Bancshares; files $200 mln stock offering)
  • TERN -3.1% (CFO to depart)
  • GTY -2.5% (pricing of an underwritten public offering of 3,500,000 shares of its common stock at a public offering price of $30.10/share)
  • GABC -2.4% (merger agreement with Heartland BancCorp)
  • RGEN -1.4% (to acquire Tantti)
  • VAL -1% (provides fleet status update)
Analyst comments:
  • ULCC -3.9% (downgraded to Underweight from Neutral at JP Morgan)
  • IART -3.8% (downgraded to Sell from Neutral at Citigroup)
  • GNTX -1.2% (downgraded to Neutral from Outperform at Exane BNP Paribas)

>>> US Gapping up

Gapping up
In reaction to earnings/guidance:
  • SFM +17.4%, HLIT +15.7%, FFIV +13.7%, VRNS +10.6%, DAWN +9.5%, TLRY +8.7%, NMR +7.2%, HWM +7.1%, BYON +7%, PYPL +5.9%, PLOW +5.7%, SWK +5.6%, CORT +5.3%, NEOG +5.3%, LDOS +5.2%, ZBRA +4.6%, CDP +4.4%, JBLU +4.2%, PJT +3%, PSX +2.6%, SPGI +2.5%, AMT +2.4%, HAYW +1.9%, CNP +1.7%, STNG +1.6%, SOFI +1.5%, INCY +1.5%, NEO +1.4%, IT +1.4%, ST +1.3%, BP +1.3%, WELL +1.1%, PFE +1%, XYL +1%, AUDC +0.9%
Other news:
  • GUTS +10.8% (FDA breakthrough device designation for revita in weight maintenance for people with obesity who discontinue GLP-1 based drugs)
  • DRVN +5.7% (Closes $275 Million Securitization Issuance to Refinance Existing Debt)
  • FEIM +4.2% (to delay 10-K filing)
  • VSTO +3.9% (announces that its Board of Directors has commenced a review of strategic alternatives)
  • VSTM +3.6% (FDA orphan drug designation for avutometinib and defactinib)
  • NVO +2.7% (Older GLP-1 drugs might help protect brains of patients with early Alzheimer's disease, according to Stat News)
  • ALGM +2.1% (repurchases shares held by Sanken Electric)
  • BNTX +1.6% (topline data from the ongoing Phase 2 clinical trial in patients with unresectable stage III or IV melanoma whose disease had progressed following anti-PD-(L)1-containing treatment)
  • NTLA +1.5% (authorization of its Clinical Trial Application by the United Kingdom's Medicine and Healthcare products Regulatory Agency to initiate a Phase 1/2 study evaluating NTLA-3001)
  • SD +1.2% (to acquire assets in Western Anadarko basin for $144 mln)
  • AMRX +1.2% (FDA approval for potassium phosphates injection IV Bags)
Analyst comments:
  • AFRM +4.9% (upgraded to Buy from Neutral at BofA Securities)
  • ASML +2.5% (upgraded to Overweight from Equal Weight at Barclays)
  • BV +1.9% (upgraded to Outperform from Neutral at Robert Baird)
  • COLL +1.5% (upgraded to Buy from Neutral at H.C. Wainwright)