Early premarket gappers
Gapping up: VYGR +35.5%, TLRD +24.1%, LULU +15.9%, PHMD +8.8%, HRB +7.1%, NXEO +5.6%, TGI +5.2%, EARS +4.8%, AMD +4.4%, SDRL +2.9%, NWSA +2.7%, CHK +2.1%, BBL +2%, SMG +1.9%, BHP +1.8%, GLW +1.5%, AZN +1.5%, MTL +1.5%, BBVA +1.5%, NGG +1.5%, WLL +1.4%, COST +1.4%, DB +1.3%, RIO +1.2%, NEM +1.1%, AG +1%, SAN +1%, GDX +0.9%, SBGL +0.8%, BP +0.8%, FCX +0.8%, SHLD +0.7%
Gapping down: RGSE -24.3%, OHRP -18.8%, CMTL -13.3%, VRNT -12%, JCAP -6.7%, CODI -5.4%, UNFI -4.3%, MIND -3.8%, ECC -3.4%, CIEN -2.8%, CASY -2.7%, GFI -2.6%, EZPW -2.5%, IPI -2.4%, ATKR -2.2%, HMY -1.8%, NVS -1.5%, SKX -1.2%, HSBC -1.2%, ING -1%, FIT -0.9%, TSN -0.5%
Greek Banks — Falling Political Risks, Upgrade Sector to Buy
Upgrade Greek Banks to Buy — All the four Greek banks in our coverage are now rated Buy/High Risk (1H). Positive 1) Asset Quality Clarity — BoG’s report on NPE reduction for the banking system gives more clarity. Positive 2) Falling GGB Yield — Greek banks could have €100-180m per bank capital and P&L benefit through GGB holdings and lower cost of equity. Positive 3) Crisis Valuation —The sector is trading at 0.3x 2016 P/TB. We forecast 5.4% 2019E RoE or 11.3% excluding surplus capital. Risk 1) Asset Margin Pressure — 8-20% of Greek banks’ NIIs are from NPLs. We expect muted NII growth for Greek banks. Risk 2) Medium Term High Loan Losses — Greek banks might need to take large write-offs, leading to elevated loan losses in coming years. Risk 3) Macro & Political Uncertainties — While the political risks are receding, the uncertainties remain high and economic recovery is fragile to external shocks.
Dow +1.55% S&P +1.32% Nasdaq +1.14% Russell +0.88%
US Market closed higher on new record. Healthcare started on a weak note on Trump comments. Heavy tech lead the move of the market higher.Similar to technology, four of the remaining five cyclical sectors posted gains while energy (+0.7%) lagged, but still ended in the green even though crude oil fell 2.3% to $49.77/bbl. The energy component slumped into the close after the government's inventory report confirmed last night's bearish reading from the American Petroleum Institute. In addition to showing an inventory build, today's EIA report revealed large increases in gasoline and distillate inventories. Two countercyclical sectors—telecom services (+2.4%) and real estate (+2.2%)—settled atop the leaderboard thanks to daylong demand for Treasuries, which resulted in a five-basis point downtick in the 10-yr yield (2.34%). Volume were above average with more then 1bil shares. TLRD +22%, LULU +14%, HRB +6% following earnings/guidance, VYGR +35.1% on trial update news... CMTL -11.8%, VRNT -10.6% following earnings/guidance. Australia's ASX200 leads regional indices higher as rising price of iron ore continues to benefit miners; S&P/ASX at 3-month high above 5,500. Nikkei225 also with a meaningful advance despite the retreat in USD/JPY amid lower US Treasury yields; Moody's lowers Italy rating outlook to Negative from Stable after Sunday's NO referendum vote, citing concerns with slow progress on economic reform and risk of postponement in addressing debt burden. Japan Q3 final GDP revised lower, though the quarter is the 3rd straight of expansion; Annualized lowered to 1.3% from 2.3% and q/q to 0.3% from 0.5%, with CAPEX the most notable downward revised component at -0.4% vs 0% prelim. China Nov Trade Balance showing smaller than expected surplus in both USD and CNY terms, but Export and Import components top expectations in both formats
Nikkei +1.45% Hang Seng +0.35% CSI -0.16% Shanghai -0.20%
Eur$ 1.0765 CNH 6.8960 CNY 6.8802 JPY 113.66 GBP 1.2650 CHF 1.0069 RUB 63.4319
S&P +0.06% EuroStoxx +0.65% FTSE +0.30% Dax+0.55% SMI +0.34%
Macro :
- Denmark Considers Scaling Back Wind Energy Support: Berlingske
- Italy Credit Rating Outlook to Negative From Stable by Moody’s
Keep an eye on :
- AC FP : AccorHotels to Partner W/ Banyan Tree, Will Take 5% Stake
- ATC NA : Altice to Invest in Films, Distribution Is Key, CEO Tells Figaro
- AMUN FP : Amundi Said to Plan Up to EU2b Share Sale for Pioneer Deal: FT
- BMPS IM : Monte Paschi Asks ECB for Deadline Extension Until Jan. 20
- GBF GY : Bilfinger Eyes Projects in Iran, Middle East: Handelsblatt
- BMW GY : BMW Hasn’t Made Any Decision to Change Mexico Production: Pannes
- FINGB SS : Fingerprint Cuts 2016 Revenue Forecast, Guides for 2017
- GAM SM : Siemens Exempted From Having to Bid for All of Gamesa’s Shares
- GLEN LN : Russia Sells $11 Billion Stake in Rosneft to Glencore, Qatar (3)
- NOVN VX : Novartis Reports Positive Results From Large-Scale Ultibro Study
- ROG VX : Roche Receives European Approval of Venclyxto to Treat CLL
- SAN FP : Regeneron Says Eczema Drug Application Review Accepted by EMA
- SIE GY : Siemens Exempted From Having to Bid for All of Gamesa’s Shares
- LOCAL FP : Olivier Sichel and Towerbrook Could Make Solocal Offer: Figaro
- SYNN VX : ACCC: ACCC will not oppose ChemChina’s proposed acquisition of Syngenta
- SYNN VX : Former Syngenta CFO Ramsay to Advise ChemChina: Handelszeitung
- TKA GY : Thyssenkrupp Was Target of Professional Cyber-Attack: WiWo
- UCB BB : UCB Cimzia Phase 3 Results in Psoriasis Confirm Earlier Findings
- UCG IM : UniCredit Starts Placement of Pekao Equity-Linked Certificates
- VWS DC : Denmark Considers Scaling Back Wind Energy Support: Berlingske
- VIV FP : Vivendi: Continues to Seek a Recomposition of Ubisoft Board, Ubisoft Stake Held by Vivendi Rose to 25.15%: AMF
- VOW# GY : EU Said Planning Action Against 7 Nations Over VW Scandal: Rtrs