>>> Stoxx 600 Pre-Market Indications

  • Nel (D7G TH) +1.7%
  • BP (BPE5 TH) +1.3%
    • OPEC+, Saudi Output Cuts Offer 2H Oil-Price Relief: Chart Pack
  • Scout24 SE (G24 TH) +1.2%
    • Scout24 SE Rated New Buy at Citi; PT 70.50 euros
  • Fuchs Petrolub (FPE3 TH) +1.1%
    • Fuchs Petrolub Rated New Overweight at Barclays; PT 45 euros
  • Adyen (1N8 TH) +1%
  • Hermes (HMI TH) +0.7%
  • TUI (TUI1 TH) +0.7%
    • Watch Europe Travel Stocks on Air Traffic Control Strike Report
  • Prosus (1TY TH) +0.7%
  • Thyssenkrupp (TKA TH) +0.7%
  • Kering (PPX TH) +0.7%
  • Engie (GZF TH) -0.6%
  • Alfa Laval (AA9 TH) -1.1%
  • Kion (KGX TH) -1.9%
  • Delivery Hero (DHER TH) -2.2%
    • Delivery Hero Cut to Underperform at BNPP Exane; PT 35 euros
  • Just Eat Takeaway (T5W TH) -2.4%
    • Just Eat Takeaway Cut to Underperform at BNPP Exane

>>> TradeGate Pre-Market Indications

DAX:
  • Vonovia (VNA TH) +1.1%
  • Bayer (BAYN TH) +0.5%
    • EU Body Sees No Critical Concern With Contentious Pesticide (1)
MDAX:
  • Fuchs Petrolub (FPE3 TH) +1.9%
    • Fuchs Petrolub Rated New Overweight at Barclays; PT 45 euros
  • Scout24 SE (G24 TH) +1.7%
    • Scout24 SE Rated New Buy at Citi; PT 70.50 euros
  • Nordex (NDX1 TH) +1%
  • Kion (KGX TH) -1%
    • Kion Names Christian Harm as CFO, Replacing Marcus Wassenberg
  • Delivery Hero (DHER TH) -1.7%
    • Delivery Hero Cut to Underperform at BNPP Exane; PT 35 euros
  • SMA Solar (S92 TH) -3%
    • SMA Solar Cut to Neutral at BNPP Exane; PT 115 euros
SDAX:
  • MorphoSys (MOR TH) +1.7%
  • Ceconomy (CEC TH) +1.2%
  • PVA TePla (TPE TH) +1.1%
  • United Internet (UTDI TH) -2.4%
    • United Internet Cut to Hold at HSBC; PT 15 euros

>>> Europe : Brokers Upgrades & Downgrades - 7th of July 2023

>>> Up
* Antin Raised to Overweight at Morgan Stanley; PT 20 euros
* ConvaTec Raised to Hold at HSBC; PT 200 pence
* Duell Raised to Buy at Inderes; PT 1.60 euros
* Elementis Raised to Overweight at JPMorgan; PT 144 pence
* Newmont Corp Raised to Overweight at Barclays; PT $61
* Rotork Raised to Buy at Jefferies; PT 370 pence
* Saint-Gobain Raised to Buy at Stifel; PT 68 euros
* Scatec Raised to Overweight at Barclays; PT 115 kroner
* Wienerberger Raised to Buy at Stifel; PT 37.50 euros

>>> Down
* Atrium Ljungberg Cut to Sell at ABG; PT 170 kronor
* Avance Gas Cut to Hold at Arctic Securities; PT 100 kroner
* BHP Cut to Hold at Berenberg; PT 2,400 pence
* BW LPG Cut to Hold at Arctic Securities; PT 100 kroner
* Dorian LPG Cut to Hold at Arctic Securities; PT $25
* Getinge Cut to Equal-Weight at Morgan Stanley; PT 210 kronor
* United Internet Cut to Hold at HSBC; PT 15 euros
* Vincit Cut to Accumulate at Inderes; PT 4.80 euros
* Zurich Ins. Cut to Neutral at Citi; PT 445 Swiss francs

>>> Initiation
* Fuchs Petrolub Rated New Overweight at Barclays; PT 45 euros
* IBM Rated New Neutral at JPMorgan; PT $145

>>> Call
* Elementis Upgraded at JPMorgan on Better Earnings Backdrop
* GTCR’s Worldpay Takeover; Jefferies Turnaround: Financials Wrap
* Rotork Upgraded to Buy at Jefferies on Healthy Balance Sheet
* Swedish Banks Can Withstand Real Estate Collapse, SEB Says

>>> What to look at today - 7th of July 2023

Shares fell across Asia on Friday after stronger-than-expected private hiring data in the US roiled equities on Wall Street and pushed up Treasury yields. A region-wide stock gauge slid for a third day, with large declines in Australia and in Hong Kong-listed technology firms. US equity futures extended on losses seen Thursday in the S&P 500 and Nasdaq 100 benchmarks as investors turned their focus to the release of critical nonfarm payrolls numbers later in the day. ADP Research Institute data showed US companies added the most jobs in more than a year in June, underscoring the inflationary threat from the resilient labor market. Samsung Electronics Co. dropped in Seoul after reporting its biggest decline in quarterly revenue since at least 2009. Japanese drug maker Eisai Co. was among the biggest contributors to losses in the Topix index on concern over adoption risks for its Alzheimer’s drug, even after the medication received full approval from the Food and Drug Administration.  Treasuries extended losses in Asia with the policy sensitive two-year yield at 5%, while that on the 10-year note hovered near the highest since March. The two-year yield jumped as much as 17 basis points Thursday following the ADP report and data showing the service sector expanded in June at the fastest pace in four months. The slide in Treasuries reverberated across Asia, with Australia’s 10-year yield climbing to the highest level since 2014, before paring the advance. New Zealand’s bond yields also jumped. Currencies were mixed in Asia after the Bloomberg Dollar Spot Index rose to the highest level in about four weeks Thursday. The yen was marginally stronger after rising against all its Group-of-10 peers in the prior session, supported by comments from the Bank of Japan about a “balanced” approach toward yield-curve control. 
The offshore yuan traded in a narrow range after the People’s Bank of China ramped up support for the currency again through its daily fixing. Swap contracts linked to the Federal Reserve’s future policy decisions almost fully price in a quarter-point interest-rate hike by July 26 and show a growing likelihood of an additional move by year-end. This expectation for higher rates is reinforcing bets on tighter monetary policy globally as central banks struggle to rein in inflation. Traders will be on tenterhooks for Friday’s US nonfarm payrolls and unemployment reports to see if they reinforce or reduce pressure on the Fed to raise rates soon. Economists surveyed by Bloomberg are expecting figures to moderate.  In Asia, investors were on the lookout for any stimulus decision by the Chinese government. The country is at a critical stage of economic recovery and industrial upgrading, Premier Li said during an event on Thursday. He pledged to “spare no time” in implementing a batch of targeted policies to strengthen the country’s economic recovery. Traders in Chinese assets were also watching the meeting of US Treasury Secretary Janet Yellen and Premier Li Qiang in Beijing for any signs of improvement in the frayed trade ties of the two superpowers. Oil headed for a second weekly gain after OPEC+ leaders Saudi Arabia and Russia tightened supplies and US crude stockpiles fell. Gold steadied Friday, but remained on track for a fourth consecutive weekly loss. US After Hours BIIB is the big news as FDA converted Leqembi to traditional approval, stock remains halted; LEVI -5.9% lower on earnings; ABBV -0.1% ticks lower on reduced guidance.

Nikkei -0.77% Hang Seng -0,28% CSI -0.03% Shanghai +0.13% Shenzen -0.20%

Eur$ 1.0895 CNH 7.2519 CNY 7.2434 JPY 143.83 GBP 1.2743 CHF 0.8957 RUB 91.0842 TRY 26.1223 WTI$ 72.07 +0.38% Gold 1,912 +0.06% BTC 30,100 -0.71% ETH 1,855 -1.50%

S&P -0.08% Nasdaq -0.11% EuroStoxx +0.28% Ftse +0.02% Dax +0.22% SMI +0.04%

Macro :
- EU paves way to quit international accord on energy investments
- UK Plans to Reverse MiFID II Ban on Free Research for Clients
- EU Is Pushing China to Narrow the Scope of Metal Export Controls
- BlackRock’s Nearly Perfect ETF Record Spurs Hope of Bitcoin Fund
- Hedge Fund Dymon Hires Yu From Goldman, Aims to Raise $1 Billion
- Broadcom to Build Chip Plant in Spain, Economy Minister Says

Keep an eye on :
- BABA US : China Will Wrap Ant Probe With $1.1 Billion Fine, Reuters Says -->
- AZE BB : Azelis Holder PSP Investments Holding Europe Offers Shares
- BIIB US : Biogen, Eisai Alzheimer’s Drug Gets Full Approval
- CABP LN : CAB Payments London Debut Highlights IPO Doldrums: ECM Watch
- CO FP : Casino Groupe Posts Full Text of Rival Offers Online
- CLN SW : Clariant Lowers FY Sales Forecast
- CLASB SS : Clas Ohlson June Sales +5%
- ENEL IM : KKR, Entel to Buy Stake in Telefonica’s Peru Fiber Wholesale
- FABG SS : Fabege 1H Rental Income SEK1.69B Vs. SEK1.48B Y/y
- GRF SM : China Resources Said to Weigh Deal for Grifols Stake in Raas
- LAZ US : Lazard Dismissed Snellenbarger for Alleged Misconduct at Party
- MC FP : L Catterton Said to Tap Banks for US IPO of Birkenstock
- OR FP : Coty Sinks Most in 2 Months Despite Higher Estimates
- MYTIL GA : Mytilineos Raises €500m From New 7-Year Bond Issue
- NETW LN : Brookfield Offers Share Alternative in Network International Bid
- NTEL NO : Nortel Holders Agree With Unifon on Sale of 70% of Company
- NOVOB DC : Novo Nordisk Sues to Block Pharmacy-Made Wegovy Knock-Offs
- ORA FP : E&, Orange Said to Weigh Bids For 45% Stake in Ethio Telecom
- PIRC IM : Sinochem to Nominate Jian for Pirelli Chair Seat: Ansa (July 6)
- PRS SM : Berlusconi’s MFE Signals Interest in Growing in Spanish Market
- REP SM : Repsol 2Q Refining Margin $6.4/Bbl Vs $23.3/Bbl a Year Earlier
- REP SM : Repsol Taps Lazard to Find Methanol Plant Investor: Expansion
- ROTH FP : Concordia Bought All Rothschild Shares Permitted Prior to Offer
- SGO FP : Saint-Gobain to Invest $235M to Expand Florida Gypsum Site
- SWTQ SW : Schweiter Technologies Names Urs Scheidegger as Group CFO Sept.1
- ENR GY : Siemens Energy Sets Up Twin Taskforces to Investigate Wind Unit
- GLE FP : SocGen’s €9 Billion CIB Losing Growth, Share as ROE Prioritized
- SUN SW : Sulzer Boosts FY Net Orders Forecast
- TSLA US : Tesla Starts to Lay Off Some Battery Workers at China Factory
- YOU LN : YouGov to Buy GfK’s Consumer Panel Business for €315m in Cash

>>> US After Hours Summary: BIIB is the big news as FDA converted Leqembi to tra

After Hours Summary: BIIB is the big news as FDA converted Leqembi to traditional approval, stock remains halted; LEVI -5.9% lower on earnings; ABBV -0.1% ticks lower on reduced guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: SAND +1.8%

Companies trading higher in after hours in reaction to news: GRRR +36.4% (signs contract worth more than $270 mln with Government of Egypt), CRON +4.3% (receives unsolicited indications of interest from third parties), CZR +0.4% (Caesars Sportsbook mobile sports betting app expands into Puerto Rico), ZLAB +0.1% (names new CFO)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: LEVI -5.9%, KRUS -1.8%, ABBV -0.1% (guides Q2 and FY23 EPS below consensus)

Companies trading lower in after hours in reaction to news: BLZE -5.6% (eliminates dual-class share structure), MRNS -3.7% (Adage Capital discloses 5.45% stake), KTB -2% (in sympathy with LEVI earnings), SRPT -0.9% (selects AcariaHealth as part of the limited distribution network for ELEVIDYS), RIOT -0.8% (provides June production and operations updates), COST -0.7% (reports June comps of +3.0%), PLTR -0.7% (Director sold 37076 shares), LL -0.3% (names new CFO), QTRX -0.2% (launches LucentAD), CBOE -0.1% (names new CFO; also reports June trading volume), ABNB -0.1% (CEO sold 30000 shares)

>>> US Close Dow -1,07% S&P -0,79% Nasdaq -0,82% Russell -1,64%

Closing Stock Market Summary

The major indices all registered losses on this downbeat session, yet they were able to rebound from intraday lows around mid-morning with no specific news to account for the move, although the rebound coincided with market rates sliding back from peak intraday levels. The S&P 500, Nasdaq Composite, and Dow Jones Industrial Average had been down as much as 1.4%, 1.6%, and 1.5%, respectively. By the close, their losses ranged from 0.8% to 1.1%.  

Even the Russell 2000, which lagged its larger peers with a 1.6% decline, bounced back from an earlier loss of 2.6%. 

Rising market rates, the biggest factor driving today's retreat, created a reason to take more money off the table following the market's strong start to the year. The 2-yr note yield rose seven basis points to 5.01% and the 10-yr note yield rose 10 basis points to 4.04%. Those moves were in response to this morning's strong labor data and the stronger-than-expected ISM Non-Manufacturing Index for June. 

Briefly, ADP estimated that 497,000 jobs were added to private sector payrolls in June (Briefing.com consensus 245,000). That news preceded a report that weekly initial jobless claims for the week ending July 1 were 248,000 (Briefing.com consensus 250,000), which is well below recession-like levels. The Employment Situation Report for June will be released before the open on Friday.

The bump in rates stoked valuation concerns in the stock market as participants considered the possibility of the Fed being more aggressive than expected with its tightening action. A 25 basis points rate hike in July has been solidified while expectations for rate hikes at future meetings increased. 

According to the CME FedWatch Tool, the probability of a second rate hike in September jumped to 27.7% from 18.1% yesterday; however, the probability of a rate hike in November jumped to 46.7% from 35.9%.

All 11 S&P 500 sectors and 28 of the 30 Dow components closed with losses. Apple (AAPL 191.81, +0.48, +0.3%) and Microsoft (MSFT 341.27, +3.12, +0.9%) were the lone outperformers to close with a gain from the DJIA. Those stocks also offered some support to the information technology sector (-0.2%), which saw the slimmest decline today.

Other sectors that outperformed the broader market included consumer staples (-0.3%) and real estate (-0.6%). Meanwhile, the energy (-2.5%) and consumer discretionary (-1.7%) sectors logged the largest declines.

  • Nasdaq Composite: +30.7% YTD
  • S&P 500: +14.9% YTD
  • S&P Midcap 400: +6.1% YTD
  • Russell 2000: +4.6% YTD
  • Dow Jones Industrial Average: +2.3% YTD

Reviewing today's economic data:

  • The weekly MBA Mortgage Applications Index fell 4.4% with purchase applications dropping 5.0% and refinance applications falling 4.0%.
  • According to ADP, private sector hiring increased by 497,000 in June (consensus 245,000) following a downwardly revised 267,000 (from 278,000) in May. Jobs in the goods-producing sector increased by 124,000 while jobs in the service-providing sector surged by 373,000. Small and medium businesses led the hiring, registering gains of 299,000 and 183,000, respectively, versus a decline of 8,000 positions at large establishments.
  • Separately, initial jobless claims for the week ending July 1 increased by 12,000 to 248,000 (Briefing.com consensus 245,000). Continuing jobless claims for the week ending June 24 decreased by 13,000 to 1.720 million.
    • The key takeaway from the report is much the same: initial jobless claims -- a leading indicator -- continue to run well below recession-like levels.
  • The May Trade Balance Report showed a narrowing in the trade deficit to $69.0 billion ( consensus -$69.0 billion) from an upwardly revised $74.4 billion (from -$74.6 billion) in April. The deficit moved in a positive direction, but not because of any overwhelming strength in exports. On the contrary, exports were $2.1 billion less than April exports. The swing factor was that imports were $7.5 billion less than April imports.
    • The key takeaway from the report is that the decline in exports and imports is emblematic of a softening in global demand that one would expect to see in an environment where many of the world's leading central banks are raising rates.
  • The final IHS Markit Services PMI reading for June fell to 54.4 from 54.9. 
  • JOLTS - Job Openings totaled 9.824 million in May following a revised count of 10.320 million in April (from 10.103 million).
  • The ISM Non-Manufacturing Index for June checked in at 53.9% (consensus 51.1%), increasing from 50.3% in May. The dividing line between expansion and contraction is 50.0%. The increase from May suggests activity in the services sector picked up steam in June.
    • The key takeaway from the report is the understanding that services sector activity expanded at a faster pace in June, a trend that will temper hard-landing concerns and presumably contribute to the Fed's inclination to implement additional tightening.
  • Weekly EIA Crude Oil Inventories showed a draw of 1.51 million barrels after last week's draw of 9.60 million barrels.

Market participants will receive the June Employment Report tomorrow at 8:30 a.m. ET that will include:

  • Nonfarm Payrolls ( consensus 220,000; prior 339,000) 
  • Nonfarm Private Payrolls ( consensus 210,000; prior 283,000)
  • Average Hourly Earnings ( consensus 0.3%; prior 0.3%)
  • Unemployment Rate ( consensus 3.6%; prior 3.7%)
  • Average Workweek ( consensus 34.3; prior 34.3)

Weekly EIA Natural Gas Inventories (prior +76 bcf) will be released at 10:30 a.m. ET.