>>> What to look at today - 18th of February 2021

Asian stocks retreated with U.S. futures and Chinese sharespared return-from-holiday gains as traders weighed the implications of the recent jump in Treasury yields. Crude oil extended its advance amid the cold blast disrupting U.S. output.
Stocks in South Korea and Hong Kong underperformed, while those in China, reopening after the Lunar New Year break, gave up earlier gains. S&P 500 futures retreated after the index closed flat and European contracts were little changed. The Nasdaq ended lower Wednesday amid concern about the impact of higher yields on tech share valuations. The dollar was little changed.
Benchmark Treasury yields were steady after climbing as high as 1.33% Wednesday and then retreating. Crude oil touched $62 a barrel. Bitcoin held above $52,000 a day after vaulting past that level for the first time.
US After Hours SNBR +12.5%, WK +11%, TWLO +10.6%, MANT +10.1% up big on earnings; STMP -9.2%, SAM -8%, IQ -6.8%, SPWR -4.8%, FSLY -3.8%, HLF -3.7% trade lower on earnings

Nikkei -0.19% Hang Seng -1.20% CSI -0.72% Shanghai +0.51% Shenzen -0.49%

Eur$ 1.2043 CNH 6.4496 CNY 6.4585 JPY 105.92 GBP 1.3847 CHF 0.8991 RUB 73.7120 TRY 6.9839 WTI$ 61.58 +0.72% GOLD $1,782.23 +0.34% BTC 51,9010 +525

S&P -0.30% Nasdaq -0.53% Eurostoxx -0.08% FTSE +0.19% Dax -0.06% SMI +0.16%

Macro :
- Goldman Overtakes Citi as SPACs’ Favorite Bank: ECM Watch
- Butantan Says Sinovac Jab Works on UK, S.African Strain: Reuters
- Warburg Pincus Files Two SPACs Seeking Combined $750 Million

Keep an eye on :
- AIR FP : Airbus 4Q Adj. FCF EU4.9B vs Target of ‘At Least’ Break Even
- AF FP : Air France-KLM Expects Bailout Within Weeks as Cash Burn Mounts
- ANA SM : Acciona’s Board to Discuss Potential IPO of Renewables Unit
- ADAPT SS : Adapteo 4Q Comparable Ebitda Beats Estimates
- ADP FP : Paris Airports Operator ADP Expects Traffic Rebound in 2024-27
- ARCAD NA : Arcadis FY Dividend Per Share EU0.60
- ASRNL NA : ASR Nederland FY Operating Profit Beats Estimates
- ATO FP : Atos Sees 2021 Organic Revenue +3.5% to +4%
- BCVN SW : BC Vaudoise FY Net Income CHF330.8M Vs. CHF362.9M Y/y
- BAMNB NA : BAM Sets New Targets as Dutch Builder Shrinks to Improve Profit
- EN FP : Bouygues FY Current Operating Income Beats Estimates
- CAP GY : Capgemini Sees 2021 Revenue In Constant Currency +7.0% to +9%
- COV FP : Covivio Targets 2021 EPRA Earnings of EU380M-EU395M
- CSGN SW : Credit Suisse Posts Lower Than Expected Loss in Relief for CEO
- DAI GY : Daimler Gives Bullish Outlook For Year of Historic Truck Spinoff
- DAI GY : Daimler CEO Sees Upside for Mercedes E-Auto Goals: Handelsblatt
- EDF FP : EDF Pays Dividend on Forecast for Earnings Recovery After Crisis
- GAM SW : GAM Holding FY IFRS Loss CHF388.4M Vs. Loss CHF3.50M Y/y
- GOGL NO : Golden Ocean Share Sale Likely to Price at NOK53 Each: Terms
- ALHRS FP : Hydrogen Refueling Says Over-Allotment Option Exercised in Full
- NK FP :Imerys FY Current Ebitda EU631M, Est. EU604M
- SDF GY : K+S: BaFin Orders Probe of Accounting of Non-Current Assets
- LI FP : Klepierre Sees 2021 Group Net Current Cash Flow Per Share EU1.90
- LRE LN : Lancashire Falls as Numis Downgrades; Winter Storm in Focus
- MTX GY :@ MTU Aero Sees 2021 Adjusted Ebit Margin 9.5% to 10.5%
- NESN SW : Nestle FY Organic Revenue Beats Estimates
- NEXT NO : Next Biometrics Offering of 14.8m Shares Prices at NOK6/Share
- ORA FP : Orange 4Q Ebitda After Leases Meets Estimates,
- ORA FP : Orange May List Or Sell Stakes in New European Tower Company
- POM FP : Plastic Omnium FY Revenue Meets Estimates
- REP SM : Repsol to Start Buy-Back Program As Much As 2.58% of Shares
- RWAY IM : RAI Way Holder Offers 10m Shares via Goldman Sachs: Terms
- SAN FP : Sanofi: Efanesoctocog Alfa Gets FDA Fast-Track Designation
- SCST SS : Scandi Standard Holders Offer 6m Shares via Danske Bank
- SINCH SS : Sinch 4Q Adjusted Ebitda Beats Estimates
- TEMN SW : Temenos Sees 2021 Non-IFRS Ebit +12% to +14%
- TKA GY : Thyssenkrupp Ends Talks With Liberty on Steel Unit Sale
- VK FP : Vallourec 4Q Ebitda EU76M, Est. EU80M
- VAR1 GY : Varta Sees 2021 Revenue About EU940M

>>> Europe : Brokers Upgrades & Downgrades - 18th of February 2021

>>> Up
* Aviva Raised on Buyback Potential, Risks Skewed to Upside: Citi
* Beiersdorf Raised to Buy at LBBW; PT 98 euros
* Credit Agricole Raised to Add at AlphaValue
* Dermapharm PT Raised to 72 euros from 53 euros at Berenberg
* Derwent London Raised to Buy at Liberum
* Infineon PT Raised to 45 euros from 17 euros at Berenberg
* Klovern Raised to Buy at SEB Equities; PT 15 kronor
* NRC Raised to Hold at DNB Markets; PT 16 kroner
* Sage PT Raised to 830 pence from 780 pence at Jefferies
* SSP Raised to Overweight at Morgan Stanley; PT 350 pence
* STMicroelectronics Raised to Hold at Berenberg; PT 39 euros

>>> Down
* K+S Cut to Hold at Commerzbank; PT 10 euros
* Lancashire Cut to Add at Numis
* Stora Enso Cut to Neutral at Citi; PT 17.10 euros
* Subsea 7 Cut to Hold at Jefferies; PT 90 kroner
* Telia Cut to Underweight at JPMorgan; PT 33 kronor

>>> Initiation
* Genel Rated New Hold at Renaissance Capital; PT 170 pence
* Gulf Keystone Petroleum Reinstated Buy at Renaissance Capital
* DNO Rated New Hold at Renaissance Capital; PT 8 kroner

>>> Call
* Airbus 4Q Beat Across the Board, Guidance Looks Light: Bernstein
* Auto Chip Shortage Positive for Infineon, STMicro: Berenberg
* Liberum Sees 2021 Gains in U.K. Property Stocks; Derwent Raised
* Subsea 7, Saipem 4Q’s to Disappoint on Limited Awards: Jefferies
* Temenos 2021 Guidance ‘Reassuring,’ Focus Now on Mid Term: Citi

>>> US After Hours Summary: SNBR +12.5%, WK +11%, TWLO +10.6%, MANT +10.1% up bi

After Hours Summary: SNBR +12.5%, WK +11%, TWLO +10.6%, MANT +10.1% up big on earnings; STMP -9.2%, SAM -8%, IQ -6.8%, SPWR -4.8%, FSLY -3.8%, HLF -3.7% trade lower on earnings

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: SNBR +12.5%, WK +11% (also CFO to retire), BCOV +10.6%, TWLO +10.6%, MANT +10.1% (also increases dividend), TLRY +8.6%, CYH +6.4%, MX +5.4%, TSLX +5.3%, EIG +5%, SKT +5%, NTR +3.9% (also increases dividend slightly, approves repurchase of 5% of shares), AXTA +3.8%, CAKE +3%, BIDU +2.7%, PAAS +2.3%, RGR +2.2%, MOS +2%, CF +1.8%, LOPE +1.7%, JACK +1.6%, LASR +1.2%, AR +0.7% (also forms drilling partnership with QL Capital), FCPT +0.6%, VMI +0.5%, PEGA +0.2%

Companies trading higher in after hours in reaction to news: CBLI +28.5% (files Form S-4 in connection with its previously announced merger agreement with Cytocom), CPG +24.5% (to acquire Shell's Kaybob Duvernay assets in Alberta for $900 mln), VTVT +4.9% (initiates phase 1 study for HPP737), CGNT +4.7% (move attributed to positive Whitney Tilson mention), CSV +3.9% (extends term of employment agreement for CEO), FTI +3.3% (awarded significant contract), MYOV +1.5% (MYOV and PFE announce journal publication for Phase 3 LIBERTY studies), EQH +1.3% (authorizes $1 bln share repurchase program), UGI +1% (to bring significant RNG supplies into its system), PRVB +0.8% (announces collaboration to commercialize PRV-3279 in Greater China), KAR +0.8% (to combine TradeRev and BacklotCars into single marketplace), HPQ +0.8% (names Marie Myers as CFO), WY +0.4% (names new CFO), NPO +0.2% (increases dividend), JNJ +0.1% (Biden admin believes a "few million" JNJ vaccine doses will be available when approved, according to NYT)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: STMP -9.2%, AM -8.7%, SAM -8%, IQ -6.8%, SM -6.3%, SPWR -4.8%, FSLY -3.8%, HLF -3.7% (also announces new $1.5 bln share repurchase program), UCTT -3.3%, AEL -3%, CDE -2.6%, RPT -1.9% (also reinstates dividend), NVTA -1.8%, ALB -1.6%, H -1.5%, SNPS -1.3%, TXG -1.3%, RBBN -1.3%, SUN -0.7%, KAI -0.6%, ALSN -0.1%, BFAM -0.1%, ET -0.1%, GMED -0.1%, HPP -0.1%, OIS -0.1%, TROX -0.1% (also increases dividend by 14%)

Companies trading lower in after hours in reaction to news: MTEM -9% (stock offering), VERU -4.4% (stock offering), BRP -1.4% (to acquire Medicare Help Now), MTDR -1.3% (reports 7% yr/yr increase in total proved reserves), BNTX -1.3% (BNTX and PFE publish results for BNT162b2 ), STC -0.2% (increases dividend), ARMK -0.2% (stock offering), FL -0.1% (announces 2021 capital allocation plans; increases dividend)

>>> US Close Dow +0.29% S&P -0.03% Nasdaq -0.58% Russell -0.74%

Closing Stock Market Summary

The S&P 500 (-0.03%) finished flat on Wednesday, battling back from an early 0.8% decline after finding support at the 3900 level. The Dow Jones Industrial Average (+0.3%) eked out a closing record high, while the Nasdaq Composite (-0.6%) and Russell 2000 (-0.7%) closed lower amid profit-taking pressure. 

Prior to the open, investors received retail sales and producer inflation data for January that easily topped expectations and supported the economic recovery thesis. Specifically, retail sales surged 5.3% m/m (Briefing.com consensus +0.8%), and the Producer Price Index jumped 1.3% m/m (Briefing.com consensus +0.5%) -- the largest increase since the index began in December 2009. 

The initial equity reaction was negative, partly because long-term interest rates resumed their quick ascent, which weighed on the valuations of growth stocks, and partly due to a view that the recovery news might have been priced in during the month's rally. The 10-yr yield, which rose ten basis points yesterday, touched 1.33% immediately after the data but finished flat at 1.30%. 

The temperance in the Treasury market likely contributed to a buy-the-dip mindset, which carried eight of the 11 S&P 500 sectors into positive territory after each started the session in the red. The energy sector (+1.5%) followed oil prices higher ($61.12/bbl, +1.03, +1.7%), and the consumer discretionary (+0.7%) and communication services (+0.5%) sectors follows behind. 

Unsurprisingly, the top-weighted information technology sector (-1.0%) held back the S&P 500 amid relative weakness in its growth-stock components, including the semiconductor stocks. The Philadelphia Semiconductor Index declined 1.9%, trimming its monthly gain to 10.1%. 

Shares of Verizon (VZ 56.99, +2.84, +5.2%) and Chevron (CVX 95.92, +2.79, +3.0%) were boosted by news that Berkshire Hathaway (BRK.B 245.21, -0.07, unch) disclosed new positions in the stocks last quarter. Shopify (SHOP 1425.00, -49.00, -3.3%) shares pulled back modestly despite reporting better-than-expected earnings results. 

Separately, the Fed-sensitive 2-yr yield decreased two basis points to 0.10%, as the FOMC Minutes from the January meeting corroborated the central bank's dovish monetary policy stance. The U.S. Dollar Index advanced 0.5% to 90.92. 

Reviewing Wednesday's economic data:

  • January retail sales surged 5.3% month-month (consensus +0.8%), aided by the receipt of stimulus checks and pent-up spending activity, and more than neutralized the downward revision for December to -1.0% from -0.7%. Excluding autos, retail sales soared 5.9% month-over-month (consensus +0.7%) and more than neutralized any disappointment that might have been attached to the downward revision for December to -1.8% from -1.4%.
    • The key takeaway from the report is that sales were up solidly across every retail category, offering an early sign of the added spending -- and economic recovery -- potential that is wrapped up in another round of proposed stimulus checks.
  • The Producer Price Index for final demand jumped 1.3% month-over-month in January (consensus +0.5%) -- the largest increase since the index began in December 2009 -- while the index for final demand, less foods and energy, rose 1.2% month-over-month (consensus +0.2%).
    • The key takeaway from this report is that producers clearly incurred higher prices in January; however, last week's Consumer Price Index showed that there wasn't any meaningful pass through to consumers. Nonetheless, there could be some angst about rising consumer prices in coming months given that the index for processed goods for intermediate demand was up 1.7% in January while the index for unprocessed goods for intermediate demand advanced 3.8%.
  • Industrial production increased 0.9% m/m in January (consensus 0.6%) following a downwardly revised 1.3% increase (from 1.6%) in December. The capacity utilization rate jumped to 75.6% (consensus 74.9%) from an upwardly revised 74.9% (from 74.5%) in December.
    • The key takeaway from the report is the continued strength in manufacturing output, which occurred despite a decline in the index for motor vehicles and parts attributed to a shortage in semiconductors used in vehicle components.
  • The NAHB Housing Market Index increased to 84 in February (consensus 86.0) from 83 in January.
  • Business inventories increased 0.6% in December (consensus 0.5%) following an unrevised 0.5% increase in November.
  • The weekly MBA Mortgage Applications Index fell 5.1% following a 4.1% decline in the prior week.

Looking ahead, investors will receive Housing Starts and Building Permits for January, the weekly Initial and Continuing Claims report, the Philadelphia Fed Index for February, and Import and Export Prices for January on Thursday.

  • Russell 2000 +14.2% YTD
  • Nasdaq Composite +8.4% YTD
  • S&P 500 +4.7% YTD
  • Dow Jones Industrial Average +3.3% YTD

WSJ : Hyundai’s New Chairman Charts High-Tech Future—Without Apple, for Now

Hyundai’s New Chairman Charts High-Tech Future—Without Apple, for Now
Groomed for the job his entire life, the 50-year-old grandson of Hyundai’s founder plans for future beyond gas-guzzling cars

When Hyundai Motor Group’s new chairman Chung Eui-sun took over last fall, he outlined a bold road map for a future where flying vehicles and robots make up as much business as typical gas-guzzling cars.

A few months later, he would get a big opportunity to reshape the company along his stated design: a potential deal with Apple Inc. to build driverless cars.

Investors cheered a promising union between Apple, the world’s most valuable company, and a new Hyundai with Mr. Chung at the helm. Groomed his entire life to run the auto empire, Mr. Chung, the 50-year-old grandson of Hyundai’s founder, has shirked convention, down to often changing the color on his company car—occasionally opting for gold or navy blue—instead of keeping the standard-issue black. He earned his M.B.A. in San Francisco during the 1990s dot-com boom and has become one of the auto industry’s most outspoken technologists.

But negotiations between the iPhone maker and Hyundai and its subsidiary Kia Corp. broke down, according to South Korean regulatory filings last week. Hyundai’s discussions for self-driving cars continue with unspecified others, according to the filings.

The failure to seal a deal shows how challenging the terrain is for Mr. Chung and Hyundai, if not the broader auto industry itself, struggling to partner up or home-brew solutions for future technologies outside the traditional lines of business.

“Usually the auto maker is the one who decides everything and is in control,” said James Hong, head of mobility research at Macquarie Capital, in Seoul. “Here, Apple’s the one making the call.”

Global tech giants and the auto industry have been on a collision course for years. Both sides need each other, with factory-floor basics on one side and software wizardry on the other. But divvying up the spoils from potentially lucrative vehicle data has in some cases proven a sticking point, industry analysts say.

Mr. Chung’s quest to transform Hyundai, the world’s fourth-largest auto maker by sales, is both professional and personal. His father, who led Hyundai for two decades, became the first South Korean named to the Automotive Hall of Fame in Michigan. But to carve out his own legacy, the younger Mr. Chung aims to turn Hyundai into more than just a car maker—a challenge the whole auto industry faces.

“He knows the rules, so he knows how to be creative and where and when to push,” said Frank Ahrens, a former vice president at Hyundai’s Korean headquarters.

Mr. Chung, through a spokeswoman, declined an interview request. Hyundai and Kia declined to comment. Apple didn’t respond to a request for comment.

Even without a deal, the Hyundai-Apple discussions planted the flag for Mr. Chung’s future ambitions. Hyundai has earmarked at least $30 billion for future technology. The company has recently forged a joint venture with Aptiv PLC on autonomous vehicles, and gained controlling interest of U.S. robotics company Boston Dynamics. Kia plans to boost electric vehicles to 40% of total production by 2030, nearly quadrupling from its current levels.

Mr. Chung, a basketball junkie and “Top Gear” fan, has focused on improving the company’s image, rather than obsessing over wringing out costs, according to former Hyundai executives and employees. He oversaw the rollout of Hyundai’s new Genesis brand, a premium rival to BMW AG and others. The conglomerate hired key talent away from Audi AG and Volkswagen AG . As president of Kia in the mid-2000s, he led an effort to inject a hip image for its fleet—and the company even enlisted basketball star Blake Griffin to jump over one of its cars at a slam-dunk contest in 2011.

The company modernized internally, too, swapping out cubicles for more open-office designs. Younger employees have been known to take selfies with the third-generation Chung leader.

Neither Hyundai or Apple has specified why negotiations broke down, but the potential deal had progressed far enough in the South Korean firm’s eyes that Kia representatives had reached out to partners in recent weeks about a plan to assemble electric cars for Apple in Georgia, The Wall Street Journal reported earlier this month.

Investors sold the South Korean auto makers’ shares after they disclosed the halt in talks with Apple. But Hyundai’s stock remains up 27% this year, while Kia’s has soared by roughly a third. In contrast, South Korea’s benchmark Kospi index has increased 9% in 2021.

Hyundai’s planned corporate metamorphosis expands what the current chairman’s father, Chung Mong-koo, staked out for the formerly downtrodden South Korean auto maker two decades ago.

Once known as unreliable and cheap, Hyundai leapfrogged rivals by doubling down on the traditional car-maker playbook. Others offered warranties spanning three years or 36,000 miles. Hyundai and Kia—which set up massive plants in nonunionized Alabama and Georgia—reached for 10 years and 100,000 miles. Lower labor costs helped the South Koreans undercut competitors on price.

The company’s aggressive targets for improvement stood out in the industry and gave the company a higher tolerance for risk, said Vanessa Ton, an analyst at industry firm Cox Automotive and former Kia executive. “They’re very ambitious, and they tend to pull the trigger faster,” Ms. Ton said.

When he took over the chairmanship in October, Mr. Chung signaled further plans to update the culture of the company away from the hierarchical structure that his father had promoted.

“If each and every employee thinks of oneself as a pioneer, and channel that positive energy into our growth and that of our future generations,” Mr. Chung said in a video to employees, “I am certain we will seize fresh opportunities out of crises.”

>>> US Gapping down

Gapping down
In reaction to earnings/guidance:

  • KAR -20.7%, MERC -7.9%, LZB -5.2% (also CEO to retire), BTI -4.9%, FUN -4.8%, CRSP -3.3%, RNG -2.7%, SHOP -2.4%, HSIC -2.2%, EXAS -1.9% (also to acquire Ashion Analytics), ATH -1.9%, ACCO -1.8%, HLT -1.6%, AIG -1.5%, COMM -1.3%, SFL -1.2%, LSCC -1.1%, INVH -0.9%, DNOW -0.9%

Other news:

  • SHIP -23% (prices offering of 44.15 mln shares of common stock at $1.70 per share)
  • IMUX -17.8% (announces that oral treatment IMU-838 shows evidence of clinical activity in moderate COVID-19 in Phase 2 CALVID-1 trial)
  • CTXR -15.4% (prices $76.5 mln Registered Direct Offering priced At-the-Market)
  • AEZS -14.4% (upsizes and prices offering of 20,509,746 common shares at $1.45 per share)
  • SNDL -13.5% (files for $1 bln mixed securities shelf offering)
  • AGFY -12.2% (prices offering of 5,555,555 shares of its common stock at $13.50 per share)
  • MVIS -7.3% (enters into $50 mln at-the-market equity offering agreement; also files for mixed securities shelf offering; also guides FY20 revs in-line)
  • HQY -6.9% (prices offering of 5 mln shares of common stock for gross proceeds of $401.5 mln)
  • ENBL -4.6% (Enable Midstream Partners to be acquired by Energy Transfer LP (ET) in an all-equity transaction valued at ~$7.2 billion)
  • CHGG -3.6% (stock offering)
  • GNMK -3.5% (announces publication of study highlighting potential of ePlex Blood Culture ID Panels)
  • OZON -2.5% (announces the launch of an offering of ~$ 650 mln in aggregate principal amount of senior unsecured convertible bonds due 2026)
  • YMAB -2.2% (stock offering)
  • GPRE -1.5% (files for mixed securities shelf offering)
  • NOVA -1.2% (entered into a definitive agreement under which Sunnova will acquire Lennar's residential solar platform)
  • MORN -1% (SEC filed a civil action alleging that former credit ratings agency Morningstar Credit Ratings LLC violated disclosure and internal controls provisions of the federal securities laws)

Analyst comments:

  • USAC -1.2% (downgraded to Sector Perform from Outperform at RBC Capital Mkts)
  • NEXA -1% (downgraded to Neutral from Buy at Citigroup)
  • UAA -1% (downgraded to Hold from Buy at Argus)