IBERIAN DAILY 07 JANUARY (ANÃLISIS BANCO SABADELL)
NEWS SUMMARY: AENA, ENAGÃS, FLUIDRA.MARKETS YESTERDAY AND TODAY
Geopolitical risk returns
The sharp drops on European indices on the second session of the year due to the increased geopolitical risk were reined in throughout the day, with positive highlights coming in the UK and Switzerland, and on the negative side Germany. In the Euro Stoxx, leading the gains were Energy (driven by Brent) and those sectors benefiting from drops in bond yields, such as Real Estate, Telecoms and Food, whereas cyclical sectors like Travel & Leisure (with drops in airlines and Amadeus due to the US/Iran crisis) and Basic Resources had the biggest losses. On the macro side, in Spain the number of unemployed fell less than expected in December (it would have a positive YoY rate in Dec’20), whereas registered employment in social security once again slowed to 2.0% YoY, although the unemployment rate would stand at 13.75% in 2019. Today for the second time there will be a vote on Pedro Sanchez’s investiture, which will go through. In Germany, the number of unemployed rose more than expected in December, whereas inflation rose more than expected. In the euro zone, December’s services PMI rose slightly more than expected. Separately, the M3 index slowed unexpectedly in November. In the US, the manufacturing ISM fell unexpectedly in December, with foreign orders falling and suggesting an additional drop in industrial output at the start of 2020. Construction costs grew more than expected in November. In China, the Caixin services PMI fell more than expected.
What we expect for today
Today the markets would open with slight gains of around +0.5%. Currently, S&P futures are up +0.10% (the S&P 500 closed +0.43% higher vs. its price at the closing bell in Europe). Volatility in the US dropped (VIX 12.37%). Asian markets are rising (Japan +1.60% and Hong Kong +0.36%).
Today in Spain the investiture of the PSOE’s leader will be voted (that will go through with doubts on the real estate and REIT sectors given the cap intended to be imposed on rentals and tax changes). In the euro zone we will learn November’s retail sales and December’s inflation and in the US December’s non-manufacturing ISM and November’s factory orders.
Aena SME SA, formerly Aena SA, is a Spain-based company primarily engaged in the airports operation. Its activities are divided into four segments: Airports, which comprises Aeronautical subdivision, responsible for the management of airports, jetways, security, handling, cargo and fuel services, among others, as well as Commercial subdivision, including duty-free and specialty stores, restaurant services, car rental, as well as banking services and advertising; Services outside the terminal, which manages real estate assets, such as parking lots, warehouses and lands; International, which comprises operations of Company's subsidiary, Aena Desarrollo Internacional SA, that invests in other airport owners principally in Mexico, Colombia and the United Kingdom; and Others, encompassing corporate activities. It manages tourism, hub and regional airports, as well as heliports and general aviation areas. Furthermore, its destination range comprises Europe, the Americas, Asia and Africa.
Enagas is a gas transportation company based in Spain. Co. is engaged in the technical distribution and storage of gas through pipelines as well as the provision of regasification services. Co. and subsidiaries are engaged in the ownership, administration, storage, pipeline transportation, distribution flow, and sale of natural gas. As a transport company, Co. also provides gas and manages the gas infrastructures.
Fluidra is engaged in the manufacture and commercialization of accessories and specific products for swimming pools, irrigation, and water treatment and purification systems.
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