EUR 100.00 For Business Accounts Only

IBERIAN DAILY 02 JUNE (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ACS, BANKING SECTOR, FERROVIAL, MÁSMÓVIL, NH HOTELES.

MARKETS YESTERDAY AND TODAY

June kicks off with gains
The main European stock markets rose after a day full of activity data. In the Euro STOXX, the best-performing sectors were those hit hardest by the pandemic, Travel & Leisure and Banks, whereas the smallest gains came in Chemicals and Consumer Goods. On the macro side, in the euro zone May’s final PMI was cut slightly to 39.4 (drop in Germany vs. rise in France), but with slight positive surprises in Spain and Italy. In general, the data suggests 2Q’20 GDP growth slightly below -12% YoY. The ECB’s minutes from its meeting on 29 April suggest new monetary flexibility measures will be taken in June, with an increase in purchases from the emergency programme (PEPP). In Spain, the Govt. has opened the door to movement between regions being moved forward to Phase III (8 June). In the US, May’s manufacturing ISM recovered slightly less than expected, with rises in orders and employment. D. Trump promised to crack down on racial protests, including a mobilisation of the national guard. In Japan, May’s monetary basis rose.
What we expect for today
Stock markets would once again open with slight gains, but with sectors linked to consumption dragged down by the unrest in the US and awaiting the ECB and OPEC+ meetings. Currently, S&P futures are down -0.23% (the S&P 500 was up +0.18% vs. its price at the closing bell in Europe). Volatility in the US rose (VIX 28.23%). Asian markets are rising (Japan +1.18% and Hong Kong +0.44%).
Today there is no relevant macro data. Debt auctions: Netherlands (€ 2 Bn in 6M t-bills), France (€ 9.5 Bn in 3M, 6M, 9M and 12M t-bills) and Germany (€ 500 M in I/L bonds).

COMPANY NEWS

MÁSMÓVIL. KKR, Cinven and Providence make a friendly TOB at € 22.50/sh. (+20.2%). BUY.
The venture capital funds KKR, Cinven and Providence (the latter a shareholder in MAS with a 9.1% stake) have made a friendly TOB on the company at € 22.50/sh. (+20.2% vs. Friday’s closing price, and -10% vs. our T.P.), with the aim of delisting it. The bid’s effectiveness would be subject to the acceptance of 50% of MAS’ shareholding (they already have secured the endorsement of 29.56% of the capital until price levels of € 26.00/sh. when the commitment would be revoked). The stock soared by 23.8% yesterday (boosting also Euskaltel and Telefónica, which rallied by +10% and +3.4%, respectively, with the former pricing in a possible interest and the latter the rationalisation of the market thanks to fewer players), which made clear that the market expects either an increased offer or a counter-bid, which we also expect given the sector’s need for consolidation, which would be easier in Spain considering the high number of players.