DAX:
- E.On (EOAN TH) -0.9%
- Covestro (1COV TH) -0.9%
- Vonovia (VNA TH) -0.9%
- Allianz (ALV TH) -0.9%
- Brenntag (BNR TH) -1%
- BlackRock, Inc. Raised Brenntag Voting Rights to 5.51%
- Infineon (IFX TH) -2.3%
- Daimler Truck (DTG TH) -2.3%
- Puma (PUM TH) -2.3%
- Bayer (BAYN TH) -2.7%
- HelloFresh (HFG TH) -3.3%
- Watch European Tech as US Futures Signal Nasdaq Rally to Falter
MDAX:
- Hugo Boss (BOSS TH) +1.4%
- *FRASERS GROUP INCREASES STRATEGIC INVESTMENT IN HUGO BOSS
- TeamViewer (TMV TH) -2%
- Thyssenkrupp (TKA TH) -2.1%
- Jungheinrich (JUN3 TH) -2.5%
- Delivery Hero (DHER TH) -2.9%
- German Holdings Round-Up: Leoni, MTU Aero, Delivery Hero
- Varta (VAR1 TH) -4%
SDAX:
- Schaeffler (SHA TH) -1.7%
- Jenoptik (JEN TH) -2.2%
- SMA Solar (S92 TH) -3%
- flatexDEGIRO (FTK TH) -3.1%
- Salzgitter (SZG TH) -3.3%
- Salzgitter Cut to Underweight at JPMorgan; PT 31.60 euros
- Hugo Boss (BOSS TH) +1.7%
- Frasers Group Increases Strategic Investment in Hugo Boss
- TotalEnergies (TOTB TH) -2.6%
- Watch Europe Energy Stocks as Oil Sinks Amid Recession Worries
- Iberdrola (IBE1 TH) -2.6%
- Bayer (BAYN TH) -2.7%
- Adyen (1N8 TH) -2.9%
- Delivery Hero (DHER TH) -3.2%
- Watch European Tech as US Futures Signal Nasdaq Rally to Falter
- Carrefour (CAR TH) -3.2%
- Carrefour Cut at Bernstein on Price War, Reduced Chance of M&A
- HelloFresh (HFG TH) -3.3%
- Repsol (REP TH) -3.3%
- Watch Europe Energy Stocks as Oil Sinks Amid Recession Worries
- Santander (BSD2 TH) -3.4%
- Mowi (PND TH) -6.1%
- Mowi Secondary Abo Priced at NOK222 per Share, Terms Show
- Mowi Holder GBL Offers Up to 18.1m Shares via Goldman Sachs
>>> Up
* Admicom Raised to Buy at Inderes; PT 63 euros
* Ceres Power Raised to Buy at Goldman; PT 700 pence
* Elkem Raised to Neutral at Citi; PT 35 kroner
* NatWest Raised to Buy at Jefferies; PT 359 pence
* Smurfit Kappa Raised to Buy at Jefferies; PT 3,700 pence
>>> Down
* ArcelorMittal Cut to Neutral at JPMorgan; PT 32.50 euros
* Carrefour Cut to Underperform at Bernstein; PT 16.50 euros
* Grifols Cut to Neutral at Alantra Equities; PT 20.39 euros
* Grifols ADRs Cut to Neutral at Alantra Equities; PT $21.44
* Kone Cut to Hold at Berenberg; PT 50 euros
* Kone Cut to Sell at Goldman; PT 44 euros
* Mips Cut to Hold at Berenberg; PT 600 kronor
* Stendorren Fastigheter Cut to Hold at Handelsbanken
* Verkkokauppa.com Cut to Hold at Nordea
* Voestalpine Cut to Underweight at JPMorgan; PT 27.50 euros
>>> Initiation
* Believe Rated New Neutral at Oddo BHF; PT 11.50 euros
* Sartorius Stedim Biotech Rated New Buy at HSBC; PT 410 euros
* Stora Enso Re-Initiated Buy at Handelsbanken
* Zordix Rated New Buy at Pareto Securities; PT 35 kronor
>>> Call
* Carrefour Cut at Bernstein on Price War, Reduced Chance of M&A
* Elkem Loses Last Sell Rating as Citi Cites Rising Silicon Prices
* Mips Cut to Hold at Berenberg on Lack of Near-Term Triggers
* NatWest Upgraded to Buy at Jefferies on More Obvious Upside
* Structural Growth Shines Among Industrials When IP Growth Erodes
A stock bounce reversed in Asia on Wednesday and the dollar climbed amid ever-louder warnings about the risk of an economic downturn. An Asia-Pacific share index shed almost 1%, with Chinese technology equities among the worst performers. US and European futuresdeclined as brief optimism from a Tuesday jump in the S&P 500 and Nasdaq 100 petered out. Treasuries and the yen -- traditional havens along with the greenback -- edged up. The Federal Reserve’s aggressive monetary tightening to tame inflation, and the attendant risk of recession, continue to unsettle investors. Oil sank to roughly $105 a barrel and iron ore slid. Bitcoin fell toward $20,000, though conditions were calmer than recent cryptocurrency turmoil. Skepticism abounds about the outlook for risk assets in a year of steep drops across markets. Prognosticators from Morgan Stanley to Goldman Sachs Group Inc. warned stocks may face more losses amid dimming economic prospects. Fed Bank of Richmond President Thomas Barkin said the central bank should raise rates as fast as it can without causing undue harm to financial markets or the economy. Chair Jerome Powell is expected to reinforce the commitment to fighting price pressures when he speaks in front of lawmakers Wednesday. A backdrop of tightening financial conditions led delegates including Tesla Inc. Chief Executive Officer Elon Musk to warn the US is heading toward a recession. President Joe Biden plans call on Congress to enact a gasoline tax holiday to cool soaring pump prices and alleviate the pressure on consumers. Officials in China intensified calls for economic support. The nation’s finance minister said more pro-growth policies are being studied, and a newspaper affiliated with the Cabinet urged banks to step up infrastructure lending.
Nikkei -0.14% Hang Seng -1.23% CSI -0.32% Shanghai -0.24% Shenzen -0.15%
Eur$ 1.0496 CNH 6.7226 CNY 6.7205 JPY 136.25 GBP 1.2236 CHF 0.9680 RUB 55.0341 TRY 17.3463 WTI$ 105.97 -3.25% Gold 1,826.10 -0.37% BTC 20,538 -1.45% ETH 1,101 -1.95%
S&P -1.15% Nasdaq -1.24% EuroStoxx -1.52% FTSE -0.96% Dax -1.52% SMI -0.83%
Macro :
- Ray Dalio Says Reducing Inflation Will Come at Great Cost
- Italy Readies New EU3B Aid to Curb Energy Bills: Repubblica
- Bitcoin Sinks Again as Risk-Off Mood Returns on Recession Fears
Keep an eye on :
- ABBN SW : Structural Growth Shines Among Industrials When IP Growth Erodes
- AC FP : Accor in Talks to Sell 10.8% Stake of Ennismore for EU185m
- AURA NO : Aurora Eiendom Offers Up to NOK650m Shares at NOK93/Share
- BATS LN : Watch BAT, Imperial Brands on US Plans to Cut Nicotine Levels
- BCART BB : Biocartis Expands Astra Pact to Develop Tagrisso Diagnostic Test
- BNP FP : BNP, Peers' $20 Billion Cost Hike Forgotten as Revenue Surges
- BT/ LN : UK Culture Secretary Invites Telecoms Executives for Talks: Sky
- CLN SW : Clariant to Simplify Organizational, Leadership Structure
- ACA FP : Credit Agricole Targets Profit Above $6.3 Billion in 2025
- ENI IM : ENI’s Gas Supply From Russia for June 22 Partially Confirmed
- FME GY : DaVita Drops as Potential Profit Hit From Court Ruling Debated
- GLPG NA : Galapagos Acquires CellPoint for EU125m in Cash Upfront
- HUR LN : speculation that an unidentified potential buyer is preparing a bid - Daily Mail
- INRN SW : Interroll Lowering Outlook for 1H Operating Profit
- IPO LN : UK’s IP Group Sets Up New Cleantech Venture-Capital Investor
- LISN SW : Lindt & Spruengli Total Buyback Volume Aggregated to ~CHF748M
- NOVN SW : Novartis Gets European Okay for Tabrecta Use in METex14 skipping
- OCDO LN : Ocado Loads Up on Growth Capital as Impatience Builds: ECM Watch
- SU FP : Structural Growth Shines Among Industrials When IP Growth Erodes
- SPM IM : Saipem Board Exercises Authorization to Start EU2b Capital Hike
- SRG IM : Italy to Mandate Snam to Boost Gas Purchases to Fill Storages
- G5EN SS : Swedish Gaming Firm Upended by War Opens New Hubs Across Europe
- TOIVO FH : Toivo Group Offering of 1.9m Shares Prices at EU1.95/Share
- UMI BB : Umicore Sees Potential to More Than Double Revenue by 2030
- VOW GY : VW Picks Deutsche Bank, Morgan Stanley for Porsche IPO: Sky
After Hours Summary: Quiet after hours, LZB +11.9% up nicely on earnings; ENTA +10.3% higher on lawsuit against PFE; ORA -4.6% falls on convertible notes offeringAfter Hours Gainers:
Companies trading higher in after hours in reaction to earnings/guidance: LZB +11.9%
Companies trading higher in after hours in reaction to news: PRTK +10.6% (Nuzyra receives FDA Fast Track Designation), ENTA +10.3% (ENTA files patent infringement lawsuit against PFE), BMRN +4.6% (Japan grants approval for VOXZOGO for Injection for children with Achondroplasia), AVT +4.6% (forms strategic collaboration with Amazon Web Services), SB +1.5% (authorizes new 5 mln share repurchase program), PAYA +0.3% (selected by Promise as an integrated payments partner)
After Hours Losers:
Companies trading lower in after hours in reaction to earnings/guidance: None
Companies trading lower in after hours in reaction to news: ORA -4.6% ($350 mln convertible notes offering), BBAI -1.3% (stock offering)
Scholz aide’s comments on future links with Russia trigger dismay
German foreign policy adviser Jens Plötner said relations with Moscow as big an issue as arms to Kyiv
Politicians and commentators in Berlin have reacted with dismay to remarks by chancellor Olaf Scholz’s foreign policy adviser, who said the media should focus more on Germany’s future relationship with Russia than on supplying Ukraine with heavy weapons.
Jens Plötner was addressing accusations levelled at the German government by large parts of the media and opposition that it has been hesitant in its support for Ukraine, and much slower to supply it with heavy weapons than the US, UK and France.
Speaking at a debate at the German Council on Foreign Relations (DGAP), he said the discussion about helping Ukraine was driven by a “feverishness that misses the big issues”.
“You can fill a lot of newspaper pages with 20 Marders [a kind of infantry fighting vehicle that Kyiv has requested from Germany], but there are somehow fewer articles about what our relationship with Russia should be like in future,” he said.
“And that is at least as exciting and relevant an issue, and one we could be discussing,” he added.
The remarks prompted an angry response from Marie-Agnes Strack-Zimmermann, a prominent MP from the liberal Free Democrats, one of the three parties in Scholz’s governing coalition.
Strack-Zimmermann, chair of the Bundestag’s defence committee, said Plötner’s comments “reveal the way of thinking of the last few decades that brought us into this terrible situation”. “It’s not the time to think affectionately about Russia but to help Ukraine,” she added.
The remarks by Plötner, who rarely speaks in public, shed a rare spotlight on to the way Scholz and his team view the war in Ukraine. Scholz has come under attack from allies in eastern Europe for maintaining telephone contact with Russian president Vladimir Putin, despite the atrocities Russian troops are alleged to have committed in towns like Bucha and the devastation wrought by Russian planes and artillery on Ukrainian cities.
At the DGAP event, Plötner insisted that Germany was supporting Ukraine “politically, economically and militarily” “to a massive degree”. He was speaking just hours before Ukraine announced it had taken delivery of a number of PzH 2000 armoured howitzers — the first heavy weapons that Germany has supplied to Kyiv in the conflict. The PzH is the Bundeswehr’s most modern piece of artillery and can strike targets 40km away.
But Plötner also spoke of Ukraine’s possible membership of the EU, which will be discussed at an EU summit later this week, in terms the government in Kyiv might find unpalatable.
“Just because you’re attacked doesn’t automatically mean your rule of law improves,” he said. “The problems Ukrainians have suffered from are structural, they’re still there and they must be dealt with.”
Noah Barkin, an expert at the German Marshall Fund of the US, a think-tank, said: “The messages that Plötner sent are worrying for the people of Ukraine, Germany’s partners in eastern Europe and many of its closest allies around the world, including the United States.”
He said the comments raised questions about whether Scholz’s team was “learning the right lessons from Putin’s war”. “Can the people who promoted close ties to Moscow and Beijing for years pivot to a foreign policy vision that is fit for the challenges of this new era of systemic rivalry?” he asked.
Georg Löfflmann, assistant professor in war studies at Warwick University, said Plötner symbolised the “establishment mindset of Ostpolitik, economic engagement and military reticence that has defined German foreign policy for decades”.
Accor and Hoxton boutique hotel venture valued at more than €2bn ahead of deal
Plans to sell stake to Qatari consortium shows confidence in high end of travel market
Accor is to sell part of its stake in a luxury hotel joint venture with the Hoxton boutique chain to a Qatari consortium, valuing the company at more than €2bn and signalling confidence in the top end of the market amid a worsening economic outlook.
Europe’s largest hotel company launched the joint venture, which operates under the name Ennismore, in October through a merger of a quarter of its brands and the Hoxton hotels. The company has doubled the number of hotels it operates since the launch to more than 130 sites and also runs 275 bars and restaurants.
As part of the deal, Accor will sell a 10.8 per cent stake in Ennismore to a group of Qatari investors for €185mn, with backing from Qatar First Bank, but will retain a majority shareholding. Sharan Pasricha, co-chief executive of Ennismore, will retain just under 30 per cent of the company.
Sébastien Bazin, Accor’s chief executive, said the deal was a testament to the “formidable success” of Ennismore, which specialises in luxury hotels that serve as a destination in their own right and can attract a local clientele to their bars and restaurants.
“The future of hospitality has to lie with servicing as much a local customer base as it is to service someone who is travelling. We have to co-mingle, it’s a must,” he said. Around half of company revenue comes from food and drink sales.
Ennismore, which operates hotels in 40 countries, plans to open around 100 extra sites as part of a rapid rollout. Last year it confirmed plans for 60 new projects.
Bazin said Ennismore had benefited from a quick recovery after the pandemic, adding that the company was also earning revenue from remote workers as part of its Working From_ co-working brand, which he said would help it weather any slowdown in consumer demand later this year.
The group is expected to achieve earnings before interest, taxes, depreciation and amortisation of more than €100mn by 2023, two years earlier than originally forecast, he added.
There are 14 hotel brands under the Ennismore umbrella, including the luxury Gleneagles estate in Scotland, former Accor prize assets the Mondrian in London’s Shoreditch and SLS hotels in North America, as well as the Hoxton chain.
The deal is expected to be completed by the close of the year subject to employee consultation and regulatory approval.
U.S., Europe Help Drive Resilience of Luxury Goods Market
According to Bain & Company and the spring update of its Luxury Goods Worldwide Market Study 2022, in collaboration with Fondazione Altagamma, the sector is expected to grow and reach revenues of between 360 billion and 380 billion euros by 2025.
Bulgari Store on Fifth Avenue.
MILAN — The luxury goods market continues to show resilience and is expected to reach revenues of between 360 billion and 380 billion euros by 2025.
Despite the challenges and disruptions that took place in early 2022, from the war in Ukraine to inflation and the zero-tolerance COVID-19 restrictions in China, the midterm direction of the luxury market remains unchanged, according to Bain & Company, which on Tuesday presented the spring update of its Luxury Goods Worldwide Market Study 2022, “Rerouting the Future” in collaboration with Fondazione Altagamma.
The study presents two scenarios. An optimistic one that sees the growth path experienced in the first half of 2022 continuing throughout the year, closing 2022 with revenues of around 320 billion to 330 billion euros, growing 10 to 15 percent over 2021. Another scenario forecasts a slower recovery of mainland China and challenged spending in mature markets caused by inflationary pressure and a macroeconomic slowdown, with sales reaching 305 billion to 320 billion euros by the end of 2022, growing 5 to 10 percent over 2021.
“Luxury goods brands started this year showing especially strong growth while also playing a leading role in the world’s ongoing sustainable and digital transformation,” said Claudia D’Arpizio, a Bain & Company partner and lead author of the study.
After its worst dip in history, the personal luxury goods market in 2021 experienced a V-shaped rebound, reaching 288 billion euros in value and it registered “a remarkable performance” in the first quarter of 2022, growing by 17 to 19 percent at current exchange rates or 13 to 15 percent at constant exchange rates over the same period in 2021. The appreciation of currencies compared with the euro and a very strong Chinese New Year as well as a successful vaccination campaign also boosted the first quarter.
The U.S. and Europe led the growth in the first quarter of the year, with a surprising recovery of the latter, admitted D’Arpizio, underscoring the “enormous potential of local consumers,” which were likely neglected by luxury brands before the pandemic, and are now enticed by more marketing initiatives, events, promotions and communication.
The market benefited from a “flamboyant” 2021 holiday shopping season across the regions, said D’Arpizio, with a 7 percent increase over the same period in 2019. Additionally, China continued to see double-digit growth last year and the U.S. maintained momentum, even after the end of the federal stimulus. China’s local consumer appetite remains strong and will potentially lead the country to recover between late 2022 and early 2023, she offered.
The impact of the Russia-Ukraine conflict has so far been restricted to local markets, showing limited consequences on global luxury customer sentiment and spending. The weight of Russian and Ukrainian spending is around 2 percent so it did not really impact business, and “compared to other crises, it’s as if consumers got used to turbulence,” said D’Arpizio, although “there’s been a lot of reaction to the war, but there’s also been a strong desire to return to life,” she said characterizing this trend as YOLO — the “you only live once” effect.
While she admitted there may be a recession in the second half of the year, Europe is accelerating its recovery, despite the war. The region is on the path to recover 2019 levels of sales one year before expectations, thanks to booming local demand driven by a fierce “back to normal” attitude and a rebound in intra-regional tourism.
The U.S. is “tapping into the power of diversity and inclusion” discovering an expanded American customer base and second-tier cities.
South Korea is undergoing a profound transformation, increasing its size and cultural relevance, defined as “the new Japan,” by the study, replacing in the last two years tourist spending with local demand.
In terms of categories, iconic bags are driving the accessories segment, and high jewelry is at its peak. A recovery of social life and a return to the office are pushing new formalwear.
The virtual world is offering new opportunities for luxury brands, including the metaverse, social media and gaming. By the end of 2030, the estimated weight of digital assets and the metaverse will account for between 5 and 10 percent of the luxury market. “There are 3 billion people involved in gaming and 300 million in luxury, and the potential connection for luxury brands is huge,” D’Arpizio said.
The growing relevance of direct-to-consumer channels and responding to the call of sustainability are also key, she said.
“In the last few months, luxury brands have been forced to reroute their futures,” said Federica Levato, a Bain & Company partner and coauthor of the report. “Winners will rapidly embrace the changes, ensuring they fully understand the implications of new geopolitical dynamics and cultural trends for all of their stakeholders: consumers, investors, employees and society at large. Those that come out ahead will take advantage of the opportunities presented by the virtual world, the sustainability transformation and preferences of younger generations.”
Matteo Lunelli, president of Altagamma, and Stefania Lazzaroni, general manager of the association, also presented an update of its Consensus 2022 study. The year 2021 saw a post-COVID-19 recovery, and 2022, despite the impact of the war and the lockdowns in China, began with a very positive first quarter, showing a 17 to 19 percent growth compared with the same period in 2021.
“The confidence of American and European consumers is solid,” Lazzaroni said. As per the update, Europe is seen growing 12 percent in the year compared with a Consensus forecast of 8 percent made in November. North America is expected to grow 10 percent compared with a 7 percent growth estimated in November. Asia was expected to grow 9 percent, but the update forecasts a 5 percent gain. The Middle East is expected to grow 10 percent compared with the 7 percent gain forecast in November. Hard luxury is the category seen growing the most, up 9 percent, driven by branded jewelry, while watches have slowed down, seen growing 6.5 percent.
Lunelli said the “long-term trends remain somewhat constant” and, while admitting the existence of “strong macroeconomic uncertainties,” he said that the Consensus estimates an average 9 percent growth in earnings before interest, taxes, depreciation and amortization for the companies in the segment, driven by a strong demand of the American consumer and an acceleration of Europe.