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IBERIAN DAILY 02 FEBRUARY + 4Q’22 RESULTS. HIGHLIGHTS AND PREVIEWS (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ACCIONA, ACS, BANKING SECTOR, CELLNEX, FERROVIAL, INDITEX, SANTANDER, SIEMENS GAMESA.

At the end of today’s report, and during the entire results season, we will include a presentation with positive and negative results highlights and previews for the 4Q’22 results to be released over the coming days in Spain.

The Ibex, about to reach 9,100 points, and the Fed’s message well received in the US
The macro data released in Europe and in the US were followed by the Fed meeting, which raised rates by 25bps, as expected, hinting at two new rate hikes at the next meetings, whereas Powell insisted on the ongoing disinflation process. Within the Euro STOXX, the best-performing sectors were Autos and Construction, whereas Energy and Consumer Goods were the worst performers. On the macro side, in the Euro zone, January’s final manufacturing PMI confirmed the preliminary figure. January’s preliminary inflation slowed more than expected to 8.5%, with core inflation unchanged at 5.2% (unexpected). In the US, the ISM manufacturing index slowed more than expected, with strong deterioration of new orders, although the price index rebounded again. Separately, according to the ADP survey, private employment slowed more than expected in January, whereas December’s building spending contracted unexpectedly. In Brazil, the Bank of Brazil kept interest rates unchanged, as expected. Lastly, the OPEC+ maintained production cuts due to uncertainties in Russia and China. In US business results, T-Mobile was in line, whereas Meta (Facebook) and WestRock disappointed.
What we expect for today
European stock markets would open with gains of up to +0.5%, with tech stocks performing well. Currently, S&P futures are up +0.32% (the S&P 500 ended +1.2% higher vs. the European closing bell). Volatility in the US dropped (VIX 17.87). Asian markets are mixed (China’s CSI 300 -0.37% and Japan’s Nikkei +0.2%).
Today we will learn in Spain January’s unemployment data. In the UK the BoE will hold its meeting. In the Euro zone, the ECB will also meet today. Also we will learn in the US, labour costs and farm productivity (both for 4Q’22), weekly jobless claims, December’s factory orders and December’s final durable goods orders. In US business results, Estée Lauder, ConocoPhilips, Merck&Co, Ford, Apple and Amazon.com, among others, will release their earnings. In debt auctions: Spain (€ 6.75 Bn in bonds due 2026, 2028, 2030 and 2043).


COMPANY NEWS

SANTANDER. Worse 4Q’22 results in Core Margin, in line in CoR, beating expectations in Net profit (due to trading revenues). BUY
The 4Q’22 results were slightly worse than expected in Core Margin (NII + fee revenues – expenses), which reached € 6.77 Bn, -1.4% below expectations, due to lower fee revenues. CoR was in line with the guidance’22 of ~1%, although worse than in 3Q’22 due to Brazil (corporate client one-off) and the US, especially. FL CET1 came in at 12.04% (+40bps of generation on the quarter absorbed by -23bps of remuneration and -23bps regulatory and models. SAN has confirmed the 40% payout (equal parts cash + share buyback; 7% yield). The bank has announced the 2023 guidelines of double-digit growth in revenues, 44-45% efficiency, CoR 12% and RoTE >15% (i.e. Net Profit above € 11 Bn; +18% vs. current consensus, in line BS(e)). By divisions, compared to the consensus the results were much better in Spain, Portugal, Poland and DCB, slightly better in the rest of the divisions except the UK (-29% worse due to one-offs). The reception of these results would be slightly negative. Conference call at 10:00 (CET).