TheChek News Flow

>>> US Gapping down

Gapping down
In reaction to earnings/guidance:

SAM -8.3% (lowers EPS guidance for 2021; shipment growth and gross margins will be below guidance), SHW -3.6%, JPM -2.1%, BLK -1.6%

Other news:

CSTL -5.3% (data confirms DecisionDx-SCC as a significant and independent risk-stratification tool)

SRC -3.9% (prices offering of 8.2 mln shares of common stock at $47.60 per share)

PWP -3.1% (stock offering)

ASPN -2% (CFO to retire)

MNTV -1.1% (ZEN issues letter re proposed acquisition of MNTV)

FB -0.9% (House Select Committee subpoenas social media cos)

GOOG -0.7% (House Select Committee subpoenas social media cos)

TWTR -0.6% (House Select Committee subpoenas social media cos)

Analyst comments:

BJ -3.7% (downgraded to Underweight from Overweight at JP Morgan)

MOR -3.7% (downgraded to Equal-Weight from Overweight at Morgan Stanley)

GLW -2.6% (downgraded to Hold from Buy at Deutsche Bank)

CRNC -2.1% (downgraded to Sector Perform from Outperform at RBC Capital Mkts)

DIS -1.5% (downgraded to Neutral from Buy at Guggenheim)

EAT -1.4% (downgraded to Hold from Buy at Gordon Haskett)

CTSH -1.4% (downgraded to Neutral from Buy at Citigroup)

DPZ -1.3% (downgraded to Equal-Weight from Overweight at Morgan Stanley)

F -1.1% (downgraded to Sector Perform from Outperform at RBC Capital Mkts)

>>> US Gapping up

Gapping up
In reaction to earnings/guidance:

WFC +2.1%, WAFD +0.8%

Other news:

MNRL +4.2% (files mixed securities shelf offering)

LMDX +4% (analysis confirms its COVID-19 antigen test detects the omicron variant)

HYZN +3.5% (CEO gave an interview with Bloomberg News in which he stated that the Company expects to deliver between 500 and 700 commercial vehicles in the 2022 fiscal year)

PL +3.2% (reports successful launch of its 4x Flock, consisting of 44 SuperDove satellites, into orbit on a SpaceX Falcon 9 rocket)

RRD +2.7% (believes systems intrusion incident has been contained)

BHC +2.3% (Bausch + Lomb unit files IPO registration)

EGO +1.2% (announces Q4 preliminary gold production)

OSUR +1% (its InteliSwab tests detect Omicron as effectively as previous variants)

Analyst comments:

ATIP +4.9% (upgraded to Buy from Hold at Jefferies)

MOS +2.5% (upgraded to Outperform from Market Perform at BMO Capital Markets)

CHKP +1.8% (upgraded to Outperform from Mkt Perform at Raymond James)

CMG +1.2% (upgraded to Overweight from Equal-Weight at Morgan Stanley)

FIVE +0.9% (upgraded to Overweight from Sector Weight at KeyBanc Capital Markets)

>>> US Early premarket gappers

Early premarket gappers

Gapping up:
MNRL +4.2%, PL +3.6%, HYZN +2.6%, PRO +1.3%, RRD +1.2%, SPCE +1.2%, OSUR +1%, BHC +0.9%, C +0.9%, EGO +0.8%, SAP +0.8%, WAFD +0.8%, WGO +0.7%, TWTR +0.5%

Gapping down:
SAM -6.9%, PWP -5.4%, CSTL -5.3%, SRC -4.3%, ASPN -2%, MNTV -1.1%, BIIB -0.5%

FT : Asset manager Pimco joins song copyright investment frenzy

Asset manager Pimco joins song copyright investment frenzy

US fund group with $2.2tn under management teams up with BMG to acquire music catalogues

The US asset manager Pimco has teamed up with BMG to acquire music catalogues, according to people familiar with the matter, the latest large investor to wade into the frenzy for song copyrights.

BMG, one of the world’s largest music companies, last year agreed a partnership with the private equity group KKR, allocating $1bn to buy music rights. The amount that Pimco has committed could not be determined, but the fund manager is looking to do smaller deals than those of KKR, one person familiar with the situation said.

The advent of streaming on platforms such as Spotify has transformed the scale of the music business, boosting the appeal of music rights as an investment in an era of ultra-low interest rates.

Large institutional investors are treating music copyrights like bonds that offer a predictable yield. Copyrights generate consistent cash flows and are relatively uncorrelated to financial markets or the global economy.

The largest private equity groups, KKR, Blackstone and Apollo Global Management, have poured billions of dollars into song copyrights in the past year as streaming, which relies on monthly subscription fees, offers steadier revenue than sales in the age of compact discs.

The arrival of Pimco, with $2.2tn under management and known for its bond investments, presents an escalation. The group co-founded by Bill Gross and based in Newport Beach, California has until now stayed on the sidelines.

As more buyers enter the market, song valuations have soared, spurring musicians and songwriters to become “willing sellers” of their catalogues, particularly with touring income on hold during the pandemic.

Earlier this month, the estate of David Bowie agreed to sell his catalogue to Warner Music for more than $250m. Bruce Springsteen last month sold his catalogue to Sony Music for more than $500m. A KKR-led group in October agreed to buy a catalogue which included hits from The Weeknd for $1.1bn.

Revenue in the recorded music sector has grown for six consecutive years with a 7.4 per cent rise in 2020 to $21.6bn, according to the IFPI, an industry trade group.

Download Asset_manager_Pimco_joins_song_copyright_investment_frenzy___Financial_Times.pdf

FT : Jack Ma’s Ant faces restructuring obstacle as state investor withdraws

Jack Ma’s Ant faces restructuring obstacle as state investor withdraws

Government asset manager’s capital was needed to help fintech group meet new financial risk rules

Jack Ma’s Ant Group has suffered a setback to its government-led restructuring efforts after a state-owned asset manager unexpectedly pulled out of a deal to invest in the fintech’s lending arm.

China Cinda Asset Management, controlled by the country’s finance ministry, was set to invest Rmb6bn ($946m) in exchange for 20 per cent of Ant’s loans business, but said late on Thursday that it was withdrawing from the deal after “prudent commercial consideration and negotiation with the Target Company”.

Ant, which is controlled by the billionaire tech entrepreneur Ma, has been restructuring its business since Chinese regulators pulled the plug on its blockbuster $37bn initial public offering just days before it was set to debut in November 2020.

Ma has largely disappeared from public view as Ant and his ecommerce group Alibaba have come under severe government pressure. Financial authorities have focused on shrinking Ant’s business and limiting financial risk as part of a “rectification” campaign for the fintech company, which was China’s largest issuer of consumer credit.

The rectification plan includes winding down Ant’s biggest self-run fund and forcing it to spin off two of its most prized businesses into new companies, which have in turn accepted state-owned shareholders.

Ant’s lending business, which accounted for 39 per cent of its revenue in the first half of 2020, is being transferred to Chongqing Ant Consumer Finance, in which it holds a 50 per cent stake. Its vast horde of user data will support a new credit scoring company being set up with state-owned shareholders, in which Ant holds a 35 per cent stake.

Cinda’s planned investment was part of a capital raising for Chongqing Ant to bolster its coffers and continue lending to millions of users on Ant’s Alipay app.

Analysts at Fitch Ratings had projected the enlarged capital base would enable Ant to support a large portion of its online lending activities within new government rules to rein in financial risk.

Chongqing Ant said it “fully respects the business decision” made by Cinda and will work to bring in new investors to “ensure the rectification work on the consumer finance business is effectively carried out”.

Other minority shareholders in the venture include Cinda’s subsidiary Nanyang Commercial Bank, battery maker Contemporary Amperex Technology, state-owned distressed-debt investor China Huarong Asset Management and Jiangsu Yuyue Medical Equipment & Supply.

Jiangsu Yuyue said it was also putting off its plan to invest more in Chongqing Ant.

Dong Ximiao, chief analyst at the Zhongguancun Internet Finance Institute, said it would not be easy for Ant to find an investor to replace Cinda.

“Not many firms have Rmb6bn in cash on hand . . . and just having cash is not enough, the qualifications for investors to hold shares in these financial institutions are very high.”

Chinese regulators have continued to scrutinise Ant and its superapp, Alipay. Ant this week also scrapped an experimental investment tool it had recently begun offering to users.

Chinese business news website Caixin said the feature was forced offline because of regulatory violations. Ant said third-party fund advisers had offered the tool “as part of a trial period that has [been] completed”.

Ant has also continued to shrink its flagship money market fund Tianhong Yu’e Bao to comply with the government’s rectification plan. The fund quickly became the world’s biggest money market fund after its launch in 2013 by drawing in leftover cash that users stored in Alipay’s payments app.

But at the end of the third quarter, Yu’e Bao’s assets under management had fallen to Rmb765bn, or about half of its peak in 2018.

>>> Europe : Brokers Upgrades & Downgrades - 14th of January 2022 V2(+)

>>> Up

* Addlife Raised to Buy at Handelsbanken; PT 375 kronor

* Ascential Raised to Buy at Peel Hunt; PT 470 pence

* Aixtron Raised to Hold at Stifel; PT 19 euros

* Berkeley Raised to Buy at Deutsche Bank; PT 5,429 pence

* Castellum Raised to Buy at SEB Equities; PT 260 kronor

* Crest Nicholson Raised to Buy at Deutsche Bank; PT 438 pence

* Chr. Hansen Raised to Buy at DNB Markets; PT 620 kroner (+)

* EN+ Group GDRs Raised to Outperform at Credit Suisse; PT $22

* Mosaic Raised to Outperform at BMO; PT $50

* Kid ASA Raised to Buy at Arctic Securities; PT 120 kroner

* K+S Raised to Outperform at BMO; PT 21 euros

* LondonMetric Raised to Outperform at RBC; PT 325 pence

* Philips Raised to Buy at HSBC; PT 38 euros

* Santander Brasil ADRs Raised to Neutral at Goldman; PT $6

* Sobi Raised to Buy at SEB Equities; PT 240 kronor

* Sparebanken Sor Raised to Hold at Nordea (+)

* Truecaller Raised to Buy at Carnegie; PT 120 kronor

>>> Down

* Boliden Cut to Sell at Pareto Securities; PT 310 kronor (+)

* CIE Automotive Cut to Neutral at Mirabaud Securities (+)

* Countryside Cut to Hold at Deutsche Bank; PT 342 pence

* Equinor Cut to Hold at Berenberg; PT 245 kroner

* Fiserv Cut to Sector Weight at KeyBanc

* Ford Cut to Sector Perform at RBC; PT $26

* Gestamp Cut to Neutral at Mirabaud Securities; PT 4.70 euros (+)

* Holcim Cut to Neutral at Davy

* Jyske Cut to Sell at SEB Equities; PT 404 kroner

* MorphoSys Cut to Equal-Weight at Morgan Stanley; PT 50 euros

* MorphoSys ADRs Cut to Equal-Weight at Morgan Stanley; PT $14

* Novartis Cut to Equal-Weight at Morgan Stanley

* PagSeguro Cut to Sector Weight at KeyBanc

* Persimmon Cut to Hold at Deutsche Bank; PT 2,897 pence

* Rightmove Cut to Underweight at Morgan Stanley; PT 692 pence

* SCA Cut to Hold at Jefferies; PT 164 kronor

* Software AG Cut to Neutral at Goldman; PT 39 euros

* Spar Nord Cut to Hold at SEB Equities; PT 106 kroner

* Topdanmark Cut to Hold at Carnegie; PT 385 kroner

* Warehouse Cut to Sector Perform at RBC; PT 180 pence

>>> Initiation

* Appreciate Group PLC Rated New Buy at Panmure Gordon

* Interroll Rated New Neutral at Exane; PT 3,900 Swiss francs

* Jungheinrich Reinstated Outperform at Exane; PT 54 euros

* Kion Reinstated Outperform at Exane; PT 126 euros

* Klarabo Sverige Rated New Hold at Handelsbanken; PT 48 kronor

* Reach Rated New Buy at Investec; PT 345 pence

* Vitesco Rated New Underweight at Morgan Stanley; PT 40 euros

>>> Call

* ABI Re-Rating Possible as Investor Confidence Grows: Jefferies (+)

* Novartis Cut at Morgan Stanley on ‘Execution Concerns’

* Profit Warning, Extended Outages ‘Worst Case’ for EDF: Bernstein (+)

* Senior Trading Update ‘Very Solid;’ Debt Better, Jefferies Says (+)

(BFW) Equities Get Further Inflows as Investors Exit Cash, BofA Says

>>> Stoxx 600 Pre-Market Indications

Philips (PHI1 TH) +1.1%
- Stock fell 15% on Wednesday
SAP (SAP TH) +0.8%
- SAP Sees 2022 Non-IFRS Cloud Revenue EU11.55B to EU11.85B
- SAP Announces Up to EUR 1 Billion Share Buyback Program
Nokia (NOA3 TH) -1.5%
Infineon (IFX TH) -1.9%
Kion (KGX TH) -2.1%
BE Semiconductor (BSI TH) -2.3%
STMicroelectronics (SGM TH) -2.4%
TUI (TUI1 TH) -2.5%
ArcelorMittal (ARRD TH) -2.5%
ASMI (AVS TH) -2.7%
ASML (ASME TH) -3.7%
- Watch European Tech Stocks After Nasdaq Selloff on Fed Speakers
EDF (E2F TH) -5.8%
- EDF Trims Nuclear Power-Output Forecast 8%, Citing Repairs (1)

>>> What to look at today - 14th of January 2022

Asian stocks declined Friday after a slew of Federal Reserve officials signaled they will combat inflation aggressively and the Nasdaq 100 fell to its lowest level since October. Equities tumbled across the region, with indexes in Japan and Korea down more than 1%. U.S. futures fluctuated after American stocks tumbled Thursday, led by technology companies, which are seen as most sensitive to higher rates. Treasury yields rose, while Japan’s five-year yields climbed to their highest level since 2016. In addition, earnings may come into play: the valuation gap between Big Tech and the rest of the market is likely to narrow as the pace of earnings-per-share growth remains below that of the S&P 500 into the fourth quarter. In Asia, the Bank of Korea raised interest rates on Friday for the third time since the summer. The rare back-to-back hike likely indicates that Governor Lee Ju-yeol had become increasingly uncomfortable about waiting to move again, following recent signs that the Fed will probably raise borrowing costs earlier and more aggressively. Oil headed for a fourth weekly advance, the longest streak since October, amid signs the market is tightening.

US After Hours SAM -7.9% falls on lowered guidance; SAP +3% and PRO +1.3% higher on upside guidance

Nikkei -1.28% Hang Seng -0.39% CSI -0.82% Shanghai -0.96% Shenzen +0.02%

Eur$ 1.1480 CNH 6.3546 CNY 6.3542 JPY 113.72 GBP 1.3733 CHF 0.9098 RUB 76.1213 TRY 13.5347 WTI$ 81.94 -0.22% Gold 1,827.81 +0.29% BTC 42,890 +.12% ETH 3300 +0.25%

S&P +0.24% Nasdaq +0.31% EuroStoxx -0.85% FTSE -0.39% Dax -0.57% SMI -0.47%

Macro :

- *CHINA DEC. TRADE BALANCE 604.7B YUAN; EST. 453.7B YUAN

- Strategist Forecasts for Germany’s DAX in 2022 ( Average 16,850 implied 5.2%)

- Strategist Forecasts for U.K’s FTSE 100 Index in 2022 ( Average 7623 implied3.2%)

Keep an eye on :

- AIR FP : Airbus Deliveries Challenged as 737 Resumes China Flights: React

- AIR FP : Helicopter Operations May Be Grounded By New 5G Towers: Group

- AF FP : Air France Says KLM CEO Elbers Won’t Seek Third Term

- BME LN : B&M European Holder SSA Investments Offers About 40m Shares

- BBVA SM : BBVA Shifts $573 Million of Credit Risk to Swedish, Dutch Funds

- CAST SS : Castellum Says Ylva Sarby Westman to Leave as Deputy CEO & CFO

- DWS GY : DWS Prelim 4Q Adjusted Pretax Profit Beats Estimates

- EDF FP : EDF Cuts 2022 Nuclear Output Estimate on Outage Extensions

- EDF FP : EDF Withdraws 2022 Net Financial Debt/Ebitda Guidance

- EDF FP : EDF Finds Corrosion Cracks at its Penly-1 Nuclear Reactor: AFP

- RF FP : Eurazeo Buys Majority Stake in Ikaros Solar

- F US : Ford at $100 Billion Joins Rare Club With Market Cap Below Sales

- G IM : Generali Vice Chairman Resigns, Criticizes Board Procedures

- GSK LN : Glaxo, Lilly Medicines Get WHO’s Endorsement to Treat Covid

- GSF NO : Grieg Seafood Prelim 4Q Harvest About 23,700 Metric Tons

- NOD NO : Nordic Semiconductor Prelim 4Q Revenue Beats Estimates

- PGHN SW : Partners Group Assets Under Management $127B

- PAH3 GY : Porsche to Invest Over EU1b in Sustainable Energy Sources: HB

- SAP GY : SAP's Early 4Q Results Bode Well for Cloud Providers: React

- SAP GY : SAP Announces Up to EUR 1 Billion Share Buyback Program

- SLBEN PL : Benfica SAD Says Investor Textor Aims to Buy 16% Stake

- SOON SW : Sonova Holding to Buy Alpaca Audiology for $310 Million in Cash

- TM17 LN : TEAM17 to Buy Astragon for Up to EU100m; Starts Placing

- UMG NA : Pimco, BMG to Partner to Buy Music Catalogues: FT

- WCH GY : Wacker Chemie Prelim FY Ebitda About EU1.5B, Est. EU1.41B

- WDI GY : Prosecutors File First Charges in Wirecard Case: FT

- WDI GY : Wirecard Administrator Seeks EU140m Damages From Ex-Managers: SZ

>>> Europe : Brokers Upgrades & Downgrades - 14th of January 2022