TheChek News Flow

– A reflation wave resulting from Chinese easing, a dovish Fed/ soft $ mix and

commodity supply restraint has improved risk appetite and pushed stocks back to

the top of ranges. This can persist for a while but from here we are more cautious

given fundamental concerns about global growth and a possible slight

deterioration in the real GDP/ inflation split. We move U/W global equities, O/W

credit and keep our O/W in government bonds.

– We think the commodity rally may be a little more solid fundamentally than the

equity one and have broadened our O/W in commodities to all sectors. This also

makes us more bullish on bombed out EM asset classes like equities, where the

same EPS growth expectations as in DM markets trade for a 27% P/E discount.

Fading QE euphoria in Europe, rich valuations in Europe and the US, and margin

pressures make us more cautious these markets.

– Equities: We see this bull market as tired and old, but not finished. Our index

target implies upside from current levels.

– Credit: To mid-2017, we don’t see too much spread movements from current

levels. European credit outperforms its US counterparts in both HY and IG.

– Rates: Across the major government bond markets, forecasts to mid-2017 are

fairly mixed. EMU bonds outperform.

– Commodities: Oversupplied markets should begin to diminish in 2016. And a

boost in energy prices should also help to secure a floor under all commodities.

CS:
Anglos +2% Itochu & Mitsui said to vie for Manganese venture

Applus +3% EU Directive does not apply to vehicle inspection services

AstraZeneca unch EPS small miss, revs better, guidance unchanged

BASF +3% Ebit 1,906m, 6% ahead of cons, driven by Ag

Cargotec +1% Sales 828mln vs ocns 831.8mln, 1qAdj EBIT 58.5mln

Danske +1% DKK 4.78 vs 4.52 estimate, NII 1% beat, some one offs

Det norske +5% Covenant relaxation likely the focus, projects on track

Engie unch looks very much inline, conference call ongoing

ENI -3% Headline very poor, -€479m vs. -€12m, gearing also higher

Galp -1-2% 1Q net adj net €114 vs €121

Gemalto unch Q1 Sales Eu691m, cons 687m, 2016 outlook confirmed

IAG -3-5% Revs agead, guidance reit, negative commenat

Kleppiere unch Looks solid on first glance, Q1 LFL retail sales +2.9

KPN -1.5% Q116 1Q Adj. Ebitda Misses Ests.; Keeps Outlook Unchanged

Laird unch Q1 performance was inline with expectations

Linde +1% Q1 EBITDA €991m. 2% ahead cons. Comp Growth +1.6%

NCC -5% Big sales miss, pretax loss 309 vs. -237
Novo Nord +1% Q Sales DK 27.2bln Est DK 27.1bln,

Pearson unch Trading inline with views previously published on Feb 26th.

RBS -1-2% Adj PBT 774 vs 804mn, CET1 14.6% is 90bps lower than last Q

Rest Grp -10% FY guidance 74-80m cons 88m

Rexel +2% All inline, maintain FY16, positive commentary

Rotork +2-3% oragnic rev growth -11.5% vs. -15%, reit FY guidance

Sanofi -2% Sales EU 8.54bln est EU 8.71bln, confirms guidance

Seadrill +7-10% Alongside DET NORSKE, Seadrill have extended credit line

Spie M/P Reports Q1 sales -5.8% to EU1.193bn, with EBITA of EU57.1m

Swiss Re +1-2% headline beat, capital build and rel to recent Munich

Telefonica -2% Light on rev's, a small beat on Ebitda, reit guidance

Ultra Elect unch AGM statement reads solid - Q1 order intake has been strong

Vinci -1-2% Reports Q1 sales at EU8bn, cons 8.23. order intake at 8.7bn.

WPP -1% Said to Outline Detail of CEO Succession Plan Friday: SKY


ShoreCap:
IAG - Q1 revs +7.9% €5.08bn,oper.pft +520% €155m,trend weakness since attacks-1%

LAIRD - trading inline,mixed divisional performances,growth weighted to H2..UNCH

RBS - reports a pretax profit of £421m,net losses widen,W&G impact greater...-3%

ROTORK - revs +0.7%, order intake +2.5%,revs weighted to H2,FY expec unch...UNCH

ASTRA - Q1 eps $0.95(Est0.96). fy core eps low to mid single digit% decline..-2%

RESTAURANT GRP - Fy sales-2.5-5%.Further deterioration in trading.CEO leaves-15%

PEARSON - Trading in line with expectations.Keeps guidance..................UNCH

ULTRA ELECTRONICS - Says expectations remain unchanged......................UNCH

FBD - hardening of rates continue into 2016,weather losses not severe.......UNCH


Numis:
* ASTRAZENECA -0.5%; Sales beat, but core EPS miss, generic competition is stronger, recent acquisitions push up costs, FY16 guidance unch

* AVANCO RESOURCES mkt; 25pg Numis BUY NOTE, available on request

* FOXTONS +1%; 45pg Numis BUY NOTE, available on request

* GREAT PORTLAND mkt; Sale of Mortimer St for £27m small but sensible deal

* IAG -1%; Q1 in-line, top line beat, passenger per unit rev -3.5%, rev trends affected by terror attacks, outlook unch

* JOHNSON SERVICES mkt; £52.6m Acquisition of Portgrade, placing to raise £28.7m

* LAIRD -2%; Q1 trading inline, outlook weighted to H2, performance materials weak

* NORTHGATE +1%; 25pg Numis BUY NOTE, available on request

* OPHIR ENERGY -2%; Schlumberger completes technical due diligence however were unable to complete transaction of Heads of Term agreement. Fortuna LNG capex down to $450-500m. LNG sales agreement nearing completion.

* PEARSON -1%; Sales -4% in a relatively insignificant quarter, in line for FY expectations

* PETS AT HOME unch; Acquisition of two verterinary referral centres, Dick White Referrals and Eye-Vet Referrals

* PREMIER OIL +3%; Completion of acquisition of E.ON in N. Sea. Assets acquired at $1.6/boe have performed well during start of year immediately cash generative and providing 17kboepd.

* RBS -2%; Loss £968m as expected, William & Glyn seperation may not be achieved within timeline

* RESTAURANT GROUP -20%; WARNING, further deterioration in trading since March

* ROTORK +3%; Q1 TU reports order intake +2.5% and revs +0.7% both helped by favourable FX and further costs reductions. FY mgmt expectations remain unch. Aquisition of Mastergear for $25m.

* SOPHOS mkt; 8pg note published, forecast tweaks, pls ask

Barcap UK:

BT +2% 5% price hikes across board from 1 May
PREM OIL +2% Completion of EON acqn
LAIRD +1% Confident outlook,H2 weighted,some relief after recent APPLE -ve
ROTORK +1% FY expectations unchanged, H2 weighted
ULTRA ELEC+1% Strong order intake Q1, FY unch
IAG U/C All IL:Q1 Op prof €155m v €139m, Rev €5.1b v €4.9b
ASTRA -1% Revs +2%,but EBIT -2%, EPS IL, reit FY guid
RBS -2% Net prof IL,but weak operating perf.U/lying miss due to Revs
OPHIR -10% Deal with Schlumberger terminated as unable to agree terms
REST GRP -10% PROFIT WNG: Pretax 74-80m v 88m expected. LFLs -ve

Barcap EU:

* US$166mn of inflow into EM funds — GEM funds contributed most, with US$633bn of inflow. EMEA funds also had inflow, at US$77mn. Asia funds, however, continued to see outflow, at US$486mn, with China ETFs seeing US$311mn of outflow. LatAm funds also had a small outflow, at US$58mn.

* US$1.4bn of net foreign buying in Asia — In the week of 4/27/2016, Korea and Taiwan both had over U$500mn of foreign inflow, while India had US$205mn of inflow. In Japan, inflows recovered for the 3rd week, with US$4.7bn of foreign net purchases in TOPIX.

Merrills

* PARQUES - First day of trading. IPO priced at EU 15.50; MS/Deutsche glocos.

* HELLA - 1.74m shrs sold @ EUR 33.25; managed by Bankhaus Lampe.............

CASINO - Disposal of its Vietnamese subsidiary. Price above expectations..+3%

GEMALTO - 1Q revs €691m, 60ps ahead of cons. Mobile revs 4.4% below cons+2-3%

RBS - Stabilising NIM; strong loan growth. Core ROTE 10.9% on NAV 205p..+2-3%

BASF - Beat. EBIT 6% ahead of cons but on 7% sales miss. Short int 2.2%...+1%

LINDE - Small beat. EBITDA 1.5% & EPS 4-5% ahead. Should be taken well....+1%

TEF - Revs -0.5% v cons. EBITDA 0.3% ahead. Spain is ok, Germany weak.....+1%

ROTORK - Inline update. Orders -9% v our -3% but sales better at -11.5%...+1%

REXEL - Sales 0.6% ahead & EBITDA 2% ahead of cons. FY guidance unchanged.+1%

AZN - Mixed. 3% beat at revs, -1% vs cons and +1% vs cons at EPS level....+1%

DANSKE - Beat. Better impairments & trading. Bottom line +9.4% vs cons....+1%

ULE - Not much detail but orders were good, and outlook unchanged.........+1%

WACKER - We UPGRADE to Neutral on strong results, PO EUR 84 from EUR 70...+1%

PEARSON - Trading inline with expectations and reits guidance.............+1%

AMUNDI - Q1 3% ahead of cons, driven by lower tax rate as PBT inline......u/c

SES - Revs inline -1.9% YoY and group EBITDA -2.9% YoY v cons -3.1%.......u/c

ENI - Q1 EBIT from continued ops €472m v €220m. NI -€77m vs -€30m cons....u/c

ENGIE - 1Q EBITDA inline. ND reduced to €27.0bn (2.41x EBITDA). FY16 reit.u/c

GALP - Clean EBIT & net income inline with cons. Net debt slightly up.....u/c

LAIRD - Q1 in-line, remain confident in their outlook for growth in 2016..u/c

SWISS RE - Headline beat, strong capital vs cautious on reserving.........u/c

NOVO NORDISK - Sales -0.5% v cons, but EBIT and EPS +3% ahead of cons.....-1%

SANOFI - Sales -1.9% vs cons but EBIT & EPS both 3% ahead of cons.......-1-2%

IAG - Rev trends in Q2 affected by Brussels attacks & softness in demand..-2%

VINCI - Q1 sales 2.2% below BAML est. Co fully reits FY16 guidance........-2%

KPN - Mixed Q1 with promise of savings in H2. Revs 0.2% miss, NL 0.4% beat-2%

SPIE - Sales 7% below and EBITA 5% below cons but guidance confirmed......-3%

OPHIR - Schlumberger complete due diligence, not to proceeed with farm in.-5%

RESTAURANT GR - Warning. Looks like a 13% knock to cons for FY sales.....-15%

RBC:

ASTRA ZEN. 0% Q1 core EPS miss on acquisition costs but sales ahead, FY reit.

BASF +2% Q1 EBIT ex-items beat, but margins positive, outlook reit.

DANSKE +2% Q1 beat across the board, CET1 down small FY outlook reiterated

ENGIE 0% Q1 revenues miss slightly, EBITDA flat, call at 7am

ENI +1% First glance operating beat, NI light, outlook reit.

GEMALTO +2% Q1 revenues ahead, confirms 2016 outlook

IAG -2% Q1 EBIT ahead but prior year restated so flagt, FY reit.

KPN -2% Q1 EBITDA miss, revenues flat, low sub.growth, keeps forecasts

NOVO NORD. 0% Q1 EBIT ahead, sales beat, outlook change on crncy (+2.2% yest)

PARQUES R. - First day of trading, ref price 15.5, opens @ 10:30

PUMA 0% Q1 sales light, EBIT miss but margins inline, outlook reit.

REXEL 0% Q1 sales a small miss, French construction better, reit FY

ROTORK +1% Q1 rev ahead on currency but China, order intake (-6.4%) weak

SWISS RE. 0% Headline beat on Admin unrealised gains but underlying flat

TELEFONICA +1% Inline due to flat Spain, organic growth +'ve, margin -'ve

VINCI -2% Q1 revenues miss, travel & arrive, outlook reiterated for FY

WPP -1% To outline CEO successoin plan today (SKY)

MF

*SANOFI-Net 1.722b(1.698),Sales 8.54b(8.71),EPS 1.34(1.32)..........-1%
*BASF-Ebit 1.91b(1.77),Sales 14.2b(15.1),Ebitda 2.81b(2.7)..........+1%
*SWISS RE-NI 1.23b(969),CR 92.8%,ROE 14.6%,Prems 7.94b..............+1.5%
*FUCHS-Sales 550.2m(556.6),Ebit 85.2m(87.2),FY outlook unch.........-0.5%
*TEFS-Net 776m(788),OIBDA 3.38b(3.4),Rev 10.78b(10.,85),Reit o/l....-1%
*LINDE-Rev 4.26b(4.22),OP 991m(968.3),Cash Flow 883m................+1.5%
*ENI-Europe utilities express interest in ENI's unit $3.4bln........+0.5%
*VINCI-Rev 8b(8.23),Order intake 8.7b,confirms FY targets...........-1%
*SEB-Op Inc 93m(83),Sales 1.12b(1.12),Raise 16/17 EPS by 5% & 4%....+2%
*GEMALTO-Rev 691m(688),outlook confirmed,Mobile still weak..........+1%
*DANSKE-Net 4.78b(4.52),NII 5.26b(5.3),Fee Inc 3.38b(3.56)..........+1%
*ENGIE-Sales 18.9b(21.3),Ebitda 3.5b(3.47),Net Debt 27b(27.5).......+0.5%
*REXEL-Sales 3.16b(3.12),Adj Ebitda 121.9m,Maintains FY tgts........+2%
*KPN-Rev 1.69b(1.69),Ebitda 568m(577),Keeps outlook unch............-0.5%
*NOVO-Ebit 12.3b(11.9),Sales 27.2b(27.1),Victoza lite,Tresiba ok....+1%
*CASINO-Sells BIG C vietnam for valuation of €1bln,proceeds €920m...+2%
*ENI-Net -479m(-12.3),OP 73m(213.5),cutting Cap spend by 20% in 16..-1%
*NEMETSCHEK-Sales 77.7m(76),Net 11m(10),Ebitda 21m(19.8),FY ok......+3%
*RIB S/WARE-Rev 25.3m(21.8),Op Ebitda 7.1m(5.1),Margin 28.1%(23.3)..+1%
*NCC-Sales 9.2b(11.7),PT -309m(237),Order intake 10.1bln............-2%
*ASTRA-EPS 95c(96),Rev 6.12b(5.95),OP 1.59b(1.63),FX impact 2%......+1%
*IAG-Rev 5.1b(4.97),Cash 6.82b as of 31/3,Reits FY view.............-1%
*BILFINGER-EQT only bidder left for BFS & less than €1.4bln.........-1%
*CONTI-Sales 9.85b(10.02),Ebit 1.1b(1.08),Ebit Margin 11.3%.........+1.5%

* BofAML Bull & Bear index (from 0.1 in Feb to 5.0)…sentiment at 11-month highs

* “Summer of Shocks” (buy vol) more plausible…H1 policy “panic” ended this week, BofAML say Fed hikes June, bears getting “stopped in”, Japan yen surge (Chart 3)/China bond vigilantes/ISM<50/BREXIT all risk-off shocks

* “Summer of Stocks” (boring macro/trading range/grind higher) plausible…cash still high, US/EU credit underpinned, breadth improving

- Equities: $6.0bn outflows (outflows in 5 of past 6 weeks) ($8.7bn mutual fund outflows vs $2.7bn ETF inflows)

- Bonds: $5.3bn inflows (inflows in 8 of past 9 weeks)

- Precious metals: $0.3bn inflows (inflows in 15 of past 16 weeks)

- Money-markets: $1.4bn inflows (but $118bn outflows past 9 weeks)

- Europe: big $4.8bn outflows (largest outflows since Oct’14) (12 straight weeks = longest streak since May’10)

- Japan: $2.5bn outflows (7 straight weeks) (longest streak since Feb’12)

- EM: small $0.1bn inflows

- US: $1.6bn inflows (first in 3 weeks)

By sector, largest inflows to financials in 8 weeks ($0.4bn); weakest inflows to REITs in 10 weeks ($14mn); consumer records largest outflows in 14 weeks ($1.1bn)

- Largest munis inflows since Jan’13 ($1.3bn) (32 straight weeks of inflows)

- $1.2bn outflows from Govt/Tsy funds (10 straight weeks)

- $0.3bn inflows to EM debt funds (10 straight weeks)

- $3.9bn inflows to IG bond funds (8 straight weeks)

- $0.2bn inflows to TIPS (11 straight weeks)

- $0.5bn inflows to HY bond funds (inflows in 9 of past 10 weeks)

Sanofi has made public its letter to US oncology biopharma company Medivation (not

covered), detailing its non-binding proposal to acquire the company for $52.50/ share,

equating to $9.3bn: a >50% premium to Medivation's 2 month volume-weighted

average price, but only a 1% premium to yesterday's closing price of $52.05. This

follows recent press reports that both Sanofi and AstraZeneca had been looking at the

company. On 17 April, the Sunday Times reported that AstraZeneca had held internal

talks about making a bid, but had yet to make a formal offer. SAN indicated today that

it first approached Medivation on 25 March, however given Medivation's unwillingness

to discuss the offer, SAN made its proposal public today. This follows Bloomberg

reports (12 April) that Medivation turned down SAN's approach.

Medivation's primary focus is on oncology, which would mark a shift from an FT report

on 28 February indicating that SAN was looking at acquisitions in rare diseases up to

the size of its Genzyme acquisition ($20bn in 2011). Medivation has 1 marketed drug –

Xtandi (enzalutamide) – for castration-resistant metastatic prostate cancer (CRPC),

which was approved in the US in 2012. It is in Ph III trials for non-metastatic CRPC and

hormone-sensitive prostate cancer, and is also in Ph II trials for hepatocellular carcinoma

and breast cancer. Medivation co-promotes Xtandi in the US and receives collaboration

revenue from partner Astellas based on royalties. It also has talazoparib in Ph III in

gBRCA mutated advanced HER2-normal breast cancer and pidilizumab in Ph III for R/R

DLBCL. MDV4463 in non-alcoholic steatohepatitis is in Ph I. 2022E Bloomberg cons.

revenues for the oncology portfolio total almost $2bn: $1,503m for Xtandi (based on

Medivation collaboration revenue), $236m for talazoparib & $191m for pidilizumab.

Sanofi indicated this deal would be immediately accretive to earnings. We estimate

accretion of 8% by 2020E, even assuming no cost synergies given Astellas's role in

global promotion (see Figure 1; based on Evaluate consensus as of 16 April for

Medivation).

Our PT is based on the current 14.7x '16E weighted average sector multiple (excl Novo).

Dow-1.17% S&P-0.92% Nasdaq-1.19% Russell-1.19%

US MArket closed lower, with more pressure from the heavy tech sector, .Disappointing BOJ comments didn't help. WTI closed +1.8% @ $46.04, but traded lower in electronic trade down to $45.58. Volume were above average and one of the biggest on the last sessions with more than 1bil shares traded. US After Hours AMZN +13%, EXPE +12%, P +9%, GRPN -6%, GILD -5% following earnings. Sentiment around Japan remains cautious in the wake of surprise BOJ hold, with USD/JPY taking out stops on the downside en route to 18-month lows below 107.20. Nikkei225 futures now down over 8% from levels just before the BOJ announcement. PBoC strengthened Yuan fix by the biggest margin since 2005 to match Yen strength vs USD, in part to shield the economy from further outflows

Nikkei -3.61% Hang Seng -1.30% Shanghai -0.09%

Eur$ 1.1392 CNH 6.4820 CNY 6.4756 JPY 107.28 GBP 1.4646 CHF 0.9633 RUB$ 64.6969 WTI $46 (-0.04%)

S&P-0.06% EuroStoxx -1.08% Dax -1.05% SMI -1.05%

Macro :

- S&P 500 May Drop If Fed Sticks to Dot Plot: JPM Kolanovic

- French Recovery Picks Up as Investment, Consumer Spending Gain

Keep an eye on :

- AIR FP : Kuwait Close to Signing EU1B Airbus Helicopter Contract: Tribune

- AIR FP : Airbus Risks Significantly Higher, Cut to Neutral, JPM Says

- AMUN FP : Amundi 1Q Says Net Inflows Solid in Challenging Environment

- AREVA FP :Areva 1Q Rev. Fell to EU826m; Co. Confirms FY Cash Flow Forecast

- AAPL US : Icahn Says He Exited Apple Stake in February; Shares Fall

- ATE FP : Alten 1Q Rev. EU421m vs EU382m; Sees Positive FY Organic Growth

- BPI PL : Banco BPI 1Q Net Income EU45.8m vs EU30.9m Y/y

- BAS GY : BASF CEO Says Co. Will Continue to Refine Its Portfolio

- GBF GY : Bilfinger Said Near Decision on Building/Facility Unit: Reuters

- BOI FP : Boiron 1Q Rev. Rises 1.3% to EU154m; Co. ‘Cautious’ on Outlook

- CO FP : Casino Sells Big C Vietnam for Enterprise Value of EU1 Billion

- CFAO FP : CFAO 1Q Revenue Drops 2.7%; Sees Difficult Market in Algeria

- COFB BB : Cofinimmo Affirms Forecasts; 1Q Adj. EPS Drops 26% to EU1.27

- CSGN VX : Credit Suisse Execs Said to Spar Over Blame for $1B Loss: WSJ

- ENI IM : Europe Utilities Express Interest in Eni’s $3.4b Unit: Reuters

- ENI IM : Eni 1Q Adj. Net Loss EU479m Misses Est. for Loss EU12.3m

- ENGI FP : Engie 1Q Sales Miss Estimate, Confirms Targets

- EXM BB : Exmar 1Q EPS Little Changed as Midsize Fleet Faces Off-Hire Days

- FCC SM : FCC Moves Toward Rules for Business Data Lines

- FCA IM : Fiat/Google Car Tech Partnership Talks Hit Late Stage: WSJ

- FLU AV : IFM Holds 38.16% of Flughafen Wien Shares; Ends Purchase Offer

- FPE3 GY : Fuchs Petrolub 1Q Net, Rev. Miss, Says FY Outlook Unchanged

- FUR NA : Fugro Sees Positive Cash Flow, Margin Pressure in 2016

- GTO NA : Gemalto 1Q Rev. Beats Est.; Confirms 2016 Outlook

- NK FP : Imerys 1Q Sales EU1.038B, Falling Short of EU1.074B Estimate

- JMT PL : J. Martins 1Q Net EU77.3m Vs Est. EU72.9m, Gets Offer for Unit

- LI FP : Klepierre 1Q Rev. Edges Up, Keeps Outlook Unchanged

- KPN NA : KPN 1Q Adj. Ebitda Misses Ests.; Keeps Outlook Unchanged

- LSS FP : Lectra 1Q Revenue Up 12%; Guidance in Line With Expectations

- MAU FP : Maurel & Prom 1Q Sales Drop, Says Outlook Positive

- NOVOB DC : Novo Nordisk 1Q Net Beats Ests.; Adjusts 2016 Outlook in DKK

- RB/ LN : Reckitt Benckiser Fined A$1.7m for Consumer Law Breach: ABC

- REP SM : Repsol Ready to Resume Libya Activity When Security Permits: AFP

- RXL FP : Rexel 1Q Sales, Adj. Ebita Below Last Year; Maintains FY Targets

- SAN FP : Sanofi 1Q Business EPS Tops Est., Sales Miss; Keeps FY16 Outlook

- SOLB BB : Solvay Mothballs Egypt Soda Ash Plant, Takes ~EU90m Impairment

- SPIE FP : Spie 1Q Sale Falls 5.8% to EU1.193B, Hurt by Oil and Gas Slump

- SREN VX : Swiss Re 1Q Net Income Beats, P&C Combined Ratio Rises

- STR AV : Strabag 4Q Net Slumps 14% to EU97.95m; Proposes 65-Cent Dividend

- TCH FP : Technicolor 1Q Rev. Rises, Confirms 2016 Objectives

- TKA GY : Thyssenkrupp’s Biggest Stakeholder Open for Tie-Ups, WAZ Says

- TGYM IM : Technogym IPO Price Set at EU3.25/Shr, Co. Says in Statement

- TIT IM : Telecom Italia Plans More Efficiency Measures

- TIT IM : Tel. Italia CEO Concerned About Brazil Situation: Union Leader

- TEF SM : Telefonica 1Q Oibda EU3.4b; Est. EU3.4b

- FR FP : Valeo, Trico Say They’ve Resolved Windshield Wiper Patent Fight

- DG FP : Vinci 1Q Rev. EU8b vs Est. EU8.23b; Confirms FY Targets

- VOLVB SS : Volvo Expects to Be Successful With Brazil Tax Appeal, DI Says