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IBERIAN DAILY 19 OCTOBER + 3Q’23 RESULTS. HIGHLIGHTS AND REST OF PREVIEWS (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ACS, NATURGY.

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 3Q’23 results to be released over the coming days in Spain.

The Middle East slows the markets
The increased tension between Hamas and Israel and the rising interest rates took their toll on the stock markets, which saw losses in the US. Thus, in the STOXX 600 all sectors except Energy and Household Goods closed with losses, led by Basic Materials and Real Estate. On the macro side, in the US September’s building permits fell less than expected, while September’s housing starts rose less than expected. The Fed’s Beige Book showed growth is between stable and decreasing. Separately, the US Govt. has lifted some sanctions on Venezuelan oil. In US business results, Procter&Gamble, Netflix, State Street and Morgan Stanley beat expectations, while Zions Bank was in line and Tesla released disappointing earnings.
What we expect for today
European stock markets would open with drops >-0.5%. Currently, S&P futures are down -0.23% (the S&P 500 ended down -0.56% vs. the European closing bell). Volatility in the US rose (VIX 19.22). Asian stock markets are falling (China’s CSI 300 -1.51%, Japan’s Nikkei -1.69%).
Today in the US we will see J. Powell’s speech and weekly jobless claims. Debt auctions: Spain (€ 5 Bn in bonds due 2025, 2029 and 2033). In US business results, Phillip Morris, Blackstone, American Airlines and KeyCorp, among others, will release their earnings.


COMPANY NEWS

3Q’23 Results highlights and rest of previews
Of the stocks releasing their earnings over the coming days, on the positive side we highlight: (i) IAG (27/10), where we expect the results to be positive and continue to show the strong dynamics from the past few quarters, which along with an Outlook showing no slowdown in 4Q’23, lead us to believe the market will welcome the results, especially following the stock’s recent performance (-13% vs. IBEX since highs). And (ii) ROVI (08/11), where we foresee a robust quarter, marked by greater momentum in the third-party manufacturing business, leaving the company well-positioned to meet and even beat its 2023 guidance. With this in mind, the key will lie in the 2024 guidance that could be unveiled where ROVI will have higher visibility into “endemic” sales levels of Covid-19 vaccines.