IBERIAN DAILY 11 JUNE (ANÃLISIS BANCO SABADELL)
NEWS SUMMARY: ACS, ALMIRALL, CELLNEX, CHANGES IBEX, FERROVIAL, REPSOL.MARKETS YESTERDAY AND TODAY
Profit taking continues
It was a new session of falls for the main European stock markets that eased throughout session. Thus, in the Euro STOXX, Consumer Goods and Media were the only sectors ending in positive territory, with Banks and Basic Resources leading drops. On the macroeconomic level, the OECD forecasts that OECD countries would slow down by as much as -7.5% this year and -9.3% in the event of a new outbreak before recovering with 4.8% growth in 2021 provided that the outbreak remains under control. The ECB’s vice-chairman, L. de Guindos, stated that for the time being they do not consider the creation of a bad bank. Furthermore, the EU considers that having an agreement on the reconstruction fund in July is very complicated. In France, April’s industrial output slowed down more than expected to -37.1% YoY. In the US, May’s general and core inflation moderated more than expected to 01% and 1.2% YoY, respectively. On another note, the Fed conveyed a very cautious message and the estimates of its members suggest interest rates at around 0 until the end of 2022 with a -6.5% drop in GDP in 2020 and an unemployment that after climbing to 9.3% in 2020 will not return to lows until after 2022. J. Powell warned that the Fed continues to study the possibility of controlling and implementing a cap to the long-term segment of the rates curve.
What we expect for today
The European stock markets would open with losses of as much as -2.0%, dragged down by financial companies and cyclical sectors, with risks on oil companies after the rise in business inventories in the US. Currently, S&P futures are down -1.08% (the S&P 500 closed -0.40% lower vs. its price at the closing bell in Europe). Volatility in the US rose (VIX 27.57%). Asian markets are sliding (Japan -2.49% and Hong Kong -1.42%).
Today, in the US we will learn May’s production prices and weekly jobless claims, and in Mexico April’s industrial output. In debt auctions: Italy will issue € 6.5 Bn in bonds due 2023, 2027 and 2040 and Ireland cancelled its planned auction.
COMPANY NEWS
CHANGES IBEX. At today’s closing bell the Technical Advisory Committee will have its semiannual meeting, where we do not expect any changes.
The IBEX 35 Technical Advisory Committee will meet at today’s closing bell for its semiannual meeting (held in early March and September). If changes were to be made, Sacyr would be the most likely to be included and Mediaset to be excluded (the latter has seen the biggest drops in trading volume, awaiting the resolution of its merger with the Italian parent company). The press has mentioned a possible inclusion of Pharmamar or Solaria as alternatives to Sacyr, as well as the possible exclusion of Ence (instead of Mediaset).
ACS Actividades de Construccion y Servicios is a holding company. Through its subsidiaries, Co.'s activities are divided into the following areas: Construction, engaged in the construction of civil works, and residential and non-residential building construction; industrial services, engaged in the development of applied engineering services, installations and the maintenance of industrial infrastructures in the energy, communications and control systems sectors; services, groups together environmental services, the outsourcing of building maintenance services, logistics and transport services; and concessions, mainly engaged in transport infrastructure concessions.
Almirall is engaged in the acquisition, manufacture, storage, sale and mediation in the sale of pharmaceutical specialties and products and all manner of raw materials used to prepare pharmaceutical specialties and products. Also, Co. acquires, manufactures, storages, sales and mediates in the sale of cosmetics, chemical, biotechnological and diagnostic products for human, veterinary, agrochemical and food-industry use, as well as all manner of utensils, complements and accessories for the chemical, pharmaceutical and clinical industries. In addition, Co. is engaged in the acquisition, sale, lease, subdivision and development of land lots, land and properties of all kinds.
Cellnex Telecom SA is a Spain-based company engaged in the wireless telecommunications (telecom) business. Its activities are divided into three segments: Broadcasting infrastructure, Telecom site rental, as well as Network services and other. The Broadcasting infrastructure division comprises distribution and transmission of television (TV) and frequency modulation (FM) radio signals, operation and maintenance (O&M) of radio broadcasting network, as well as over-the-top (OTT) radio services, among others. The Telecom site rental division provides access to wireless infrastructure, primarily through infrastructure hosting and telecom equipment co-location, mainly for mobile network operators and other wireless and broadband telecom network operators. The Network services and other division offers connectivity services for a variety of telecom operators and radio communication, among others. The Company also develops 5th generation mobile networks (5G) through Alticom BV.
Ferrovial is a transportation company based in Spain. Co. is engaged in operations in the transportation sector. Co. specializes in the design, construction, management, administration and maintenance of transport infrastructures. Co.'s services range also includes the maintenance of parking lots, and land-, sea- and air-based transport networks. Co. is also engaged in the promotion and operation of short-stay parking lots, parking regulation and management services and promotion and sale of residents' parking.
Repsol is an oil and gas company. Co. is engaged in all the activities relating to the oil and gas industry, including exploration, development and production of crude oil and natural gas, transportation of oil products, liquefied petroleum gas (LPG) and natural gas, refining, the production of a wide range of oil products and the retailing of oil products, oil derivatives, petrochemicals, LPG and natural gas, as well as the generation, transportation, distribution and supply of electricity. Co. operates in more than 40 countries. Co.'s operations are divided into four segments: Upstream, Downstream, LNG and Gas Natural Fenosa.
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