>>> Europe : Brokers Upgrades & Downgrades - 28th of June 2022

>>> Up
* Dino Polska Raised to Overweight at Morgan Stanley; PT 342 zloty
* Legal & General Raised to Market Perform at KBW; PT 250 pence
* Molson Coors Raised to Neutral at Goldman; PT $54
* Saipem Raised to Buy at AlphaValue/Baader

>>> Down
* Aena Cut to Neutral at Oddo BHF; PT 130 euros
* Belimo Cut to Hold at Berenberg; PT 357 Swiss francs
* Boston Beer Cut to Sell at Goldman; PT $318
* Danske Bank Cut to Underweight at JPMorgan; PT 95 kroner
* Everfuel Cut to Neutral at SpareBank; PT 60 kroner
* Henkel Cut to Underweight at Morgan Stanley; PT 56 euros
* Nestle Cut to Equal-Weight at Morgan Stanley
* Nestle ADRs Cut to Equal-Weight at Morgan Stanley; PT $128
* Prosus Cut to Hold at Investec; PT 66 euros
* Severn Trent Cut to Underweight at JPMorgan; PT 2,700 pence
* Stillfront Cut to Sell at SEB Equities; PT 20 kronor
* VAT Cut to Hold at Berenberg; PT 286 Swiss francs

>>> Initiation
* Celanese Rated New Underperform at Credit Suisse; PT $105
* EDP Renovaveis Reinstated Buy at Jefferies; PT 27.50 euros
* EDP Rated New Buy at Jefferies; PT 5.70 euros
* GN Store Nord Reinstated Buy at Nordea; PT 450 kroner
* Marks Electrical Group Rated New Buy at Berenberg; PT 120 pence
* Softcat Rated New Buy at Shore Capital
* ZEN LN Rated New Corporate at Alternative Resource Capital

>>> Call
* Citi Cuts S&P 500 Target for Recession, Soft Landing Scenarios
* EDP, EDP Renovaveis Both Started With Buy Ratings at Jefferies
* Hugo Boss Upgraded at Jefferies, Sees Guidance as Conservative
* Nestle, Henkel Cut at MS With Defensive Qualities to Be Tested
* Softcat New Buy at Shore on ‘Robust’ Competitive Positioning
* VAT, Belimo Downgraded as Berenberg Slashes Swiss Industrial PTs

>>> US After Hours Summary: NKE -2.6% falls on earnings/guidance; FTX CEO pours

After Hours Summary: Lots of comments from banks on stress test, many plan to raise dividends; NKE -2.6% falls on earnings/guidance; FTX CEO pours cold water on HOOD -5% M&A talk, according to MarketWatch

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: None

Companies trading higher in after hours in reaction to news: KZR +104.7% (announces positive topline results from the MISSION Phase 2 trial), CRNT +24.4% (AVNW to acquire all shares of CRNT that it does not already own for $2.80/sh), SAVE +5.4% (JBLU increases offer to acquire SAVE), IVR +4.9% (reduces leverage and rotates Agency RMBS portfolio into higher coupons), MS +3.4% (discusses stress test results, to increase dividend and announces $20 bln share buyback plan), EPIX +3% (presents clinical update on EPI-7386), LOVE +2.6% (Lovesac and Joybird resolve patent litigation), GFF +2.5% (declares special cash dividend of $2/sh), GS +1.7% (discusses stress test results, to increase dividend by 25%), HPE +1.2% (announces a new partner program), HBAN +1% (discusses stress test results, exceeded all minimum capital levels), ULCC +1% (JBLU increases offer to acquire SAVE), PH +0.8% (awarded a max $444.4 mln DLA contract for actuators), ONB +0.7% (UMBF to acquire the health savings account business of ONB), C +0.3% (discusses stress test results, intends to maintain current dividend), LMT +0.2% (Sikorsky Aircraft awarded $2.28 bln Army contract; also reduces gross pension obligation by $4.3 bln), COF +0.2% (discusses stress test results, SCB is 3.1%), GILD +0.1% (resubmits NDA to FDA for lenacapavir), JPM +0.1% (discusses stress test results, intends to maintain current dividend)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: JEF -4.5% (also authorizes new $250 mln share repurchase program), CNXC -4.3%, NKE -2.6% (also authorizes new $18 bln share repurchase program), TCOM -0.3%

Companies trading lower in after hours in reaction to news: HOOD -5% (FTX CEO says co not having any active M&A conversations with HOOD, according to MarketWatch), LZB -3.1% (Lovesac and Joybird resolve patent litigation), RF -0.9% (discusses stress test results, to consider increasing dividend), F -0.2% (to recall of about 2,900 F-150 Lightning trucks due to a software issue, according to Reuters), GES -0.2% (completes previously disclosed $175 mln ASR program), STT -0.2% (discusses stress test results, to increase dividend by 10%, to begin its existing share repurchase program in Q4), BAC -0.1% (discusses stress test results, to increase dividend by 5%), BK -0.1% (discusses stress test results, to increase dividend by 9%), JBLU -0.1% (JBLU increases offer to acquire SAVE), CFG -0.1% (discusses stress test results, increases share repurchase authorization to $1 bln; will consider dividend increase)

>>> US Close Dow -0,20% S&P -0,30% Nasdaq -0,72% Russell +0,34%

Closing Stock Market Summary

The major indices did not move a whole lot in either direction today which is not necessarily a bad thing for sentiment after last week's rally. Similar rally efforts this year have been met with a tendency to sell into the strength.

A general lack of conviction on both sides of the tape could be seen in the advance-decline line. Market breadth at both the NYSE and Nasdaq was roughly flat today.

The major indices were pulled down by the mega caps. The Vanguard Mega Cap Growth ETF (MGK) closed down 1.0%. Relative weakness here is not completely surprising as the mega caps outperformed last week with a gain of 8.0%.

The broader market held up better on the day, evidenced by the more modest 0.1% decline in the Invesco S&P 500 Equal Weight ETF (RSP). Most mega cap constituents closed in the red with Amazon.com (AMZN 113.22, -3.24, -2.8%) exhibiting the largest loss. Apple (AAPL 141.66, +0.00, +0.0%), the best performing mega cap, closed flat after Reuters reported today that Supreme Court decided not to hear Apple's patent challenge with Qualcomm (QCOM 127.18, +2.08, +1.7%).

Further showing that the mega caps pulled down the broader market is the outperformance seen in small and mid cap stocks. The Russell 2000 (+0.3%) and S&P Mid Cap 400 (+0.3%) both closed with modest gains.

Of the 11 S&P 500 sectors, three closed in the green. Energy (+2.8%) was the leader by a decent margin followed by the defensive-oriented utilities (+0.8%) and health care (+0.4%) sectors. 

The top laggards were the consumer discretionary (-1.1%), communication services (-1.1%), materials (-0.8%), and information technology (-0.6%) sectors.

Separately, Treasury note yields settled the session near their highs of the day after some relatively soft auction results for the 2-yr and 5-yr note yields. The 2-yr note yield rose six basis points to 3.12% while the 10-yr note yield rose seven basis points to 3.19%.

Reviewing today's economic data:

  • Total durable goods orders increased 0.7% month-over-month (consensus +0.1%) following an unrevised 0.4% increase in April. Excluding transportation, durable goods orders also increased 0.7% ( consensus +0.4%) following a downwardly revised 0.2% increase (from 0.3%) in April.
    • The key takeaway from the report is that business spending held up quite well in May, evidenced by the 0.5% increase in nondefense capital goods orders excluding aircraft.
  • May Pending Home Sales 0.7% (consensus -3.5%); Prior was revised to -4.0% from -3.9%

Looking ahead to Tuesday, market participants will receive the following economic data: May advance goods trade deficit (prior -$105.90 bln), May advance Retail Inventories (prior 0.7%), and May advance Wholesale Inventories (prior 2.1%) at 8:30 a.m. ET. April FHFA Housing Price Index (prior 1.5%) and April S&P Case-Shiller Home Price Index (Briefing.com consensus 21.1%; prior 21.2%) at 9:00 a.m. ET.

The June Consumer Confidence reading (consensus 101.0; prior 106.4), released at 10:00 a.m. ET, will be watched closely after the June Consumer Sentiment Index was the lowest result on record.

  • Dow Jones Industrial Average: -13.5% YTD
  • S&P 500: -18.2% YTD
  • S&P 400: -17.7% YTD
  • Russell 2000: -21.1% YTD
  • Nasdaq Composite: -26.3% YTD

FT : ExxonMobil chief predicts continuing surge in oil markets

ExxonMobil chief predicts continuing surge in oil markets
‘It’s a question of how high prices eventually rise’ to spur investment, says Darren Woods

ExxonMobil’s chief executive predicted a resurgence of investment in fossil fuel production as he blamed soaring oil and gas prices on an “optimistic view” about how quickly the energy transition can happen.

Darren Woods, the head of the biggest western oil and gas supermajor, said pressure to reduce emissions by cutting production before addressing demand had left the world struggling to meet energy needs.

Governments had not only failed to deal “with the demand side of the equation” but also did not recognise “that you need a fairly robust set of alternative solutions if you’re going to reliably and affordably meet the needs of people”, Woods told the Financial Times.

Global crude prices have surged this year to well more than $100 a barrel as Russia’s invasion of Ukraine has tightened oil markets, fuelling decades-high inflation around the world. Brent crude was trading at about $116 a barrel on Monday.

Speaking to the FT on stage at a conference in Brussels organised by the German Marshall Fund, Woods said he expected the oil price to continue to climb until it spurs renewed investment in output.

“They always say that the cure to high prices is high prices. And that’s exactly what I think we’ll see. So it’s a question of how high prices eventually rise.”

Unlike its European rivals BP and Shell, which have committed to reduce oil and gas production over time to help lower emissions, Exxon has steadfastly resisted pressure to cut its production plans, and has large oil investments planned in the US, Brazil and Guyana.

Exxon came under pressure during the Covid-19 pandemic from activist investors who pushed the company to outline an energy transition strategy and successfully installed new directors to its board. The company has since announced a goal to reduce emissions from its own operations to net zero by 2050, but has resisted calls from to commit to reducing emissions created when its products are burnt.

Woods hit out at so-called “scope 3” targets for fuel consumption as “a crude approach” that would have unintended consequences.

“You’re going to drive the production and the growth in oil and gas out of the most visible . . . most responsible companies, into less visible, less transparent and potentially less responsible companies,” he said.

Still, even Exxon has pulled back its annual capital expenditure plans on oil and gas developments from before the pandemic. It now plans to spend $20bn to $25bn a year through 2027, compared to plans in 2019 to spend $30bn or more a year.

Woods said the world’s “pipeline” of new oil and gas projects was “thinner than it was in the past”, and that even with high prices, oil companies worried about the long-term demand for their product. Supply from US shale rock formations was also “not as productive as it was in the past”, exacerbating the supply shortfall, he said.

“These are multibillion-dollars investments with long time horizons,” he said. “How do you think about that with the uncertainty associated with the transition? That is a difficult balance to strike.”

(Makor) VIV buy back update

 

Guys,

 

As of June 24th, VIV still had 18m shares to buy back or 1.6% of its capital

VIV did buy back 10/14.5% of the daily volume on from June 20th to June 22ndbut none on June 23rd and June 24th which is surprising

As Henry mentioned, VIV could still be buying despite the quiet period which may have already started (1 month prior to Q2 results on 28/07)