>>> Europe : Brokers Upgrades & Donwgrades - 8th of March 2018

>>> Up
* AB Foods Upgraded to Buy at Goldman; PT 31 Pounds
* Awilco Drilling Raised to Buy at Kepler Cheuvreux; PT 41 Kroner
* Barclays Upgraded to Neutral at Goldman; PT 2.10 Pounds
* Britvic Upgraded to Overweight at Morgan Stanley; PT 8.70 Pounds
* DiaSorin Upgraded to Buy at Kempen & Co; Price Target 85 Euros
* Glencore Upgraded to Buy at AlphaValue
* Husqvarna Upgraded to Add at AlphaValue
* ING Upgraded to Buy at Kempen & Co; Price Target 16.50 Euros
* Mediobanca Upgraded to Add at AlphaValue
* Parker-Hannifin Raised to Outperform at Baird; Price Target $203
* Premier Oil Upgraded to Outperform at RBC; Price Target 1 Pound
* SDL Upgraded to Buy at Citi
* Sonova Upgraded to Neutral at UBS
* Swiss Re Upgraded to Buy at SocGen; PT 106 Francs
* Wirecard Upgraded to Buy at Bankhaus Lampe

>>> Down
* Biffa Downgraded to Hold at HSBC; PT 2.50 Pounds
* Deutsche Pfandbriefbank Downgraded to Hold at Bankhaus Lampe
* RTL Downgraded to Hold at Kepler Cheuvreux; PT 72 Euros
* Swedbank Downgraded to Neutral at Goldman; PT 229 Kronor
* Veon ADRs Downgraded to Hold at HSBC; PT $3.30
* William Demant Downgraded to Neutral at UBS

>>> Initiation
* Aveva Rated New Hold at Stifel; PT 22.50 Pounds
* Petro Matad Rated New Buy at Stifel; PT 32 Pence
* Saab Rated New Buy at SEB Equities; PT 465 Kronor
* Weir Rated New Buy at Liberum; PT 24 Pounds
* Wood Group Reinstated at Goldman With Neutral

>>> Call

>>> Asian Update

Asia Market Update: China reports unexpected trade surplus in Feb; Japan Q4 GDP revised higher amid rise in Capex

***Headlines/Economic Data***
-Asian equity markets trade generally higher
-Wynn Macau rises after release of Jan-Feb results
-China reports unexpected Feb trade surplus amid higher than expected exports and lower imports
-China Jan-Feb steel products exports -27.1% y/y
-Japan Jan Trade deficit beats expectations
- In Feb, Japanese sold a net of ¥2.73T in foreign bonds.

Australia/New Zealand
-ASX 200 opened +0.3%; closed: +0.7%%
-ASX 200 Utilities Index +1.9%, Consumer Discretionary +1.3%, Telecom +1.1%, Financials +0.8%; Resources -0.5%
-(AU) AUSTRALIA JAN TRADE BALANCE: A$1.06B V A$160ME
- (AU) Australia Feb Port Hedland Iron Ore Shipments to China: 31.3M tons v 34.7M m/m
-(NZ) New Zealand Q4 Manufacturing Activity Volume Q/Q: 1.0% v 0.3% prior; Manufacturing Activity Q/Q: 2.8% v 0.5% prior

China/Hong Kong
-Shanghai Composite opened -0.1%, Hang Seng +1.1%
Hang Seng Services Index +2.3% (gaming companies rise), Consumer Goods +1.9%, Info Tech +1.7%, Telecom +1.5%, Energy +1.4%, Financials +1.3%, Property/Construction +1.2%
Wynn Macau [1128.HK]: Rises over 5% after reporting Jan-Feb Rev +19%
- (CN) CHINA FEB TRADE BALANCE (USD): +$33.7B V -$5.7BE; Exports Y/Y: 44.5% v 11.0%e; Imports Y/Y: 6.3% v 8.0%e
- (CN) CHINA FEB FOREIGN RESERVES: $3.135T V $3.155TE (1st MoM decline in 13 months; released on March 7th)
- (CN) China PBoC Open Market Operations (OMO): Skips OMO (4th straight session): Net: CNY100B drain
- (CN) PBOC SETS YUAN REFERENCE RATE AT 6.3239 V 6.3294 PRIOR

Japan
-Nikkei 225 opened +1.1%; closed +0.5%
- TOPIX Electric Appliances Index +0.9%, Real Estate +0.6%
- (JP) JAPAN Q4 FINAL GDP SA Q/Q: 0.4% V 0.2%E; ANNUALIZED Q/Q: 1.6% V 1.0%E; Business spending Q/Q: 1.0% v 1.3%e; Deflator Y/Y: +0.1% v 0.0%e
- (JP) Japan Jan Trade Balance (BoP Basis): -¥666.6B v -¥695.5Be
- (JP) Japan Jan Current Account Balance: ¥607.4B v ¥437.4Be
- (JP) Japan FSA: Orders suspension of business at cryptocurrency exchanges including Bit Station and FSHO for 1-month beginning on March 8th
Looking Ahead: BoJ policy statement due for release on Friday

Korea
-Kospi opened +0.8%
-Samsung Electronics [005930.KR]: Could report Q1 operating profit around KRW14T v KRW9.9T y/y; The profit is seen declining q/q (from KRW15.2T) amid declining demand for displays, says the report. – Yonhap
- (NK) North Korea govt reportedly has offered a conditional halt to its ICBM program - Korean press
- (KR) South Korea Finance Min Kim: Expects South Korea will not be labelled FX manipulator by the US Treasury

Other Asia
-Singapore Exchange [SGX.SG]: Reports Feb total securities market turnover value S$32.8B, +12% m/m and +16% y/y (highest since May 2013); Feb total derivatives volume +45% y/y

North America
-US equity markets ended mixed: Dow -0.3%, S&P500 -0.1%, Nasdaq +0.3%, Russell 2000 +0.8%
-S&P500 Technology +0.6%; Consumer Staples -0.9%
- (US) White House spokesperson Sanders: there could be potential carve outs for Canada and Mexico, and could extend to other countries as determined on a national security basis
- (US) US steel and aluminum tariffs said to temporarily exempt Canada and Mexico for 30-days with extensions possible depending on NAFTA talks - Washington Post
-(US) Separately, White House reportedly could have tariff signing ceremony at noon tomorrow – NYT
- (US) CNBC's Javers: there could be more conversations in the White House on Thurs or Fri about further trade actions, including possibly against China
(US) White House floats possible successors for Gary Cohn's position; Some of the names being floated: Shahira Knight, Jim Donovan, Kevin Hassett, Larry Kudlow, Chris Liddell, Mick Mulvaney, Peter Navarro, Mark Calabria, Bob Steel. - press
-(US) White House Trade Adviser Navarro: I'm not on the list to replace economic adviser Gary Cohn
-(US) Fed's Bostic (2018 voter, dove): Trade wars are not winnable; Have to see details on the final tariff plan to estimate the economic impact; December I was forecasting two rate hikes; has adjusted that to three now; Everything is on the table in regards to two, three or four rate hikes in 2018 - comments from Florida
-(US) DOE CRUDE: +2.4M V +2.5ME;
-Express Scripts [ESRX]: Cigna said to be near deal to acquire the company - US financial press

Europe
-(EU) ECB Governing Council: ECB has no objections to Spain's de Guindos taking vice presidency
-(TR) Moody's cuts Turkey sovereign rating one notch to Ba2 from Ba1; outlook to Stable from Negative
-(UK) UK FEB RICS HOUSE PRICE BALANCE: 0% V 7%E (lowest since March 2013)
Looking Ahead: ECB rate decision expected later today


***Levels as of 01:00ET***
- Hang Seng +1.3%; Shanghai Composite +0.3%; Kospi +0.6%
- Equity Futures: S&P500 flat; Nasdaq100 flat, Dax flat; FTSE100 +0.2%
- EUR 1.2396-1.2416 ; JPY 105.92-106.22; AUD 0.7814-0.7841 ;NZD 0.7272-0.7298
- Feb Gold flat at $1,327/oz; Feb Crude Oil flat at $61.17/brl; Copper -0.4% at $3.120/lb

>>> US Close Dow -0.33% S&P -0.05% Nasdaq +0.33% Russell +0.79%


Closing Market Summary: Afternoon Rally Leaves Stocks Little Changed

An afternoon rally left the U.S. equity market little changed on Wednesday as investors contemplated the resignation of White House Chief Economic Advisor Gary Cohn. The S&P 500 finished a tick below its flat line (-0.1%), breaking a three-session winning streak, while the Nasdaq did a little better (+0.3%) and the Dow did a little worse (-0.3%). 

President Trump's proposed tariffs, which include a 25% duty on steel imports and a 10% duty on imports of aluminum, were reportedly the rift that caused Mr. Cohn's departure, which, in turn, underlined the seriousness of the White House on the matter. Mr. Trump indeed looks poised to push the tariffs forward, despite fears that they could lead to a trade war, with reports indicating that he would like to sign a presidential proclamation as early as Thursday.

It's worth noting, however, that White House Press Secretary Sarah Huckabee Sanders said there could be carve outs for NAFTA partners Mexico and Canada. The suggestion that the tariffs may not be applied in a universal fashion helped dial back the bearish sentiment on Wall Street.

The equity market looked as if it might give back all of its weekly gain immediately following news of Mr. Cohn's resignation, with the S&P 500 futures losing as much as 1.7% overnight. However, stocks quickly made a rebound attempt after opening lower. That attempt failed, but a second attempt in the afternoon proved successful, bringing the S&P 500 all the way back from a loss of 1.0%. The benchmark index touched positive territory for the first time with less than 30 minutes left in the session, but ticked back into the red in the final minutes.

Only three of eleven S&P 500 sectors finished in the green, but two of those three--technology (+0.6%) and health care (+0.5%)--are heavily-weighted, comprising around 40% of the broader market combined. Autodesk (ADSK 137.70, +17.83) was the tech sector's top-performing component, rallying 14.9%, after reporting better-than-expected earnings and revenues for the fourth quarter.

In other earnings news, Dollar Tree (DLTR 89.25, -15.11) and Ross Stores (ROST 75.40, -5.11) dropped sharply after both companies issued disappointing profit guidance; Dollar Tree also missed earnings estimates for the fourth quarter. The two retailers lost 14.5% and 6.4%, respectively.

Small caps outperformed in the midweek session, pushing the Russell 2000 higher by 0.8%, likely due to the fact that a trade war wouldn't have as harsh of an impact on smaller companies, which rely more on domestic consumers. Likewise, the S&P Mid Cap 400 added 0.2%.

Overseas, Asian equities sold off on Wednesday, but European shares advanced, with Germany's DAX (+1.1%) setting the pace. All eyes will be on the ECB's Governing Council meeting on Thursday, especially ECB President Mario Draghi's post-decision press conference. Any sense that the central bank might dial back its ultra-accommodative policy measures could lead to a knee-jerk reaction in the financial markets.

Investors received a big batch of economic data on Wednesday, highlighted by a higher-than-expected trade deficit for January (-$56.6 billion actual vs -$55.0 billion consensus), which marked the biggest deficit since October 2008. The key takeaway from the report is that trade will again be a drag on first quarter GDP growth.

The ADP National Employment Report for February, which is a prelude to Friday's Employment Situation Report, was also released, showing a larger-than-expected increase in nonfarm payrolls (235K actual vs 193K consensus). However, the ADP reading has proven unreliable in predicting the BLS nonfarm payrolls figure.

Elsewhere, U.S. Treasuries alternated between gains and losses on Wednesday, finishing little changed; the benchmark 10-yr yield climbed one basis point to 2.88%. Meanwhile, West Texas Intermediate crude futures dove 2.2% to $61.63 per barrel after the EIA reported U.S. crude inventories increased 2.4 million barrels last week. Estimates called for a build of around 2.7 million barrels.