IBERIAN DAILY 22 SEPTEMBER (ANÁLISIS BANCO SABADELL)
NEWS SUMMARY: ACS, IBERDROLA, MAPFRE, SANTANDER.MARKETS YESTERDAY AND TODAY
Drops in all sectors
The possibility of new lockdown measures, the side effects of Covid-19 vaccines, and the political uncertainty in the US dragged down stock exchanges at both sides of the Atlantic, with the core segment underperforming peripheral markets in Europe. The few macroeconomic references were not favourable (in the US Chicago’s Fed activity index dropped more than expected in August and the message from C. Lagarde, who left the door open again to increase stimulus if necessary, was not convincing either. In the Euro STOXX all sectors showed real panic to a new lockdown, with Banks, Basic Resources and Travel&Leisure being the worst performers while Utilities and Financial Services ended with the best relative performance. On the macro side, Italy approved a reduction in the number of MPs to one third vs. currently. In the US, the president of the Fed will ask the US Congress for further fiscal stimuli, especially for SMEs, as he believes that the monetary policy will be insufficient. In this regard, the Congressional Budget Office (or CBO) warned that debt will reach levels of 195% of the GDP by 2050.
What we expect for today
Stock markets would open with slight gains after yesterday’s drops. Currently, S&P futures are up +0.27% (the S&P 500 was up +1% vs. its price at the closing bell in Europe). Volatility in the US increased (VIX 27.78%). Asian markets are trading with mixed results (Hong Kong -0.4% and Japan +0.18%), where banks continue to be dragged down especially by HSBC due to the money laundering scandal.
Today we will see Powell’s appearance before Congress. In Brazil we will learn the minutes from the meeting held on the 16th of September, in the US September’s Richmond manufacturing index. In debt auctions: Netherlands (€ 6 Bn in 30Y bonds) and Germany (€ 5 Bn in 2Y bonds).
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.
Banco Santander is a holding company, providing a range of financial products. Co.'s products and services include: retail banking business that covers all customer banking businesses; wholesale banking business; as well as asset management and insurance business. Co.'s principal operations are in Spain, the U.K., Portugal, Germany, Italy and Latin America. As of Dec 31 2014, Co.'s total assets amounted to Euro1,266,296,000,000 and total customer deposits amounted to Euro647,627,000,000.
Iberdrola is a holding company. Through its subsidiaries, Co. operates in four segments: network business, which includes all the energy transmission and distribution activities, and other regulated activity originated in Spain, the U.K., the U.S. and Brazil; deregulated business, which includes electricity generation and sales businesses as well as gas trading and storage businesses carried on by Co. in Spain, Portugal, the U.K. and North America; renewable business, with activities related to renewable energies in Spain, the U.K., the U.S. and the rest of the world; and other businesses, including the engineering and construction businesses and the non-power businesses.
Mapfre is an insurance company based in Spain. Co. is the parent company of a group engaged in the underwriting and provision of insurance in Spain and abroad. Insurance policies provided include: life, non-life, accident, home-owner, general and health. Through its subsidiaries, Co. is also engaged in the provision of reinsurance, the management of investment funds, pension funds and pension plans, real estate and related services. On the domestic market, Co.'s activities include managing investment funds, pension funds and pension plans, real estate and other service businesses.
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