IBERIAN DAILY 09 JULY (ANÁLISIS BANCO SABADELL)
NEWS SUMMARY: AENA, BANKING SECTOR, CIE AUTOMOTIVE, ENDESA, INDRA, REPSOL, TALGO.Tariff uncertainty
It was a session of slight gains in European stock markets whereas the change of dates for the deadlines set by D. Trump to close trade negotiations and implementation of tariff continues (with a new deadline on the 1st August). In the STOXX 600, Basic Resources and Autos were the best-performing sectors vs. the drops of Real Estate and Household. On the macro side, in the US, June’s NFIB SMEs confidence index dropped slightly, in line with expectations, also underscoring excess inventories. In Brazil, May’s retail sales climbed more than expected. In China, June’s inflation rose more than expected, while production prices sped up their contraction more than expected. In trade matters, Trump threatened to place a 50% tariff on copper on 01 August, and medicines could see a 200% tariff within the next year. As for the EU, a general tariff of 10% is expected, but worse than the agreement reached with the UK in specific sectors.
What we expect for today
European stock markets would open with gains of around +0.2%, with oil companies performing well. Currently, S&P futures are down -0.11% (the S&P 500 ended flat vs. the European closing bell). Asian markets are climbing (China’s CSI 300 +0.29% and Japan’s Nikkei +0.33%).
Today in the US we will learn the Fed minutes and in Mexico June’s inflation.
COMPANY NEWS
REPSOL. Poor 2Q’25 Trading statement due to both upstream and industrial. OVERWEIGHT
Poor 2Q’25 Trading statement due to both upstream and industrial despite the improement seen in some operating headings vs. 1Q’25, such as higher output (up to 557kboe/d, at the top end of the guidance, with the contribution of the UK) or the refining margin (at US$ 5.90/b vs. US$ 5.30/b previously and US$ 6.00/b central-case scenario). As expected, upstream reported disappointing results due to the drop in Brent crude (US$ 67.90/b vs. US$ 75.70/b in 1Q’25 and guidance), HH gas prices (at US$ 3.40/Mbtu vs. US$ 3.70/Mbtu previously and vs. US$ 3.00/Mbtu central-case scenario) and depreciation of the dollar (-8%). Meanwhile, the Industrial division saw poor utilisation of refining distillation and conversion due to (scheduled) iterruptions and to the power outage effect (around € -80 M). In its 2Q’25 Results (24/07) we foresee around € 486 M of adjusted Net Profit (-25% vs. 1Q’25), below the consensus estimate (-11%). We expect a negative market reaction to this trading statement despite the -11% share price correction vs. Ibex and -5% vs. sector in 2025.
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.
CIE Automotive is the parent company of an industrial group formed by several companies that are engaged in the design, manufacture and sale of automobile component and sub-units on the world market. In addition, Co. is also engaged in the bio-fuels business which is in the initial stages of development and is made up of various companies devoted to the production and distribution of bio-fuels.
Endesa is engaged in the production, transmission, distribution, and supply of electricity, through hydroelectric, fossil fuel, and nuclear generation. Co. is also engaged in the mining of coal for use in its fossil-fuel electric plants; mining research; land restoration, and environmental monitoring and control.
Indra Sistemas is engaged in the design, development, manufacture, assembly, repair, and installation of computer software and applications. Through its subsidiaries, Co. is engaged in consulting, graphic design and multimedia, web design and marketing, internet development and electronic trade, systems integration and hosting geared business to business and business to consumer, as well as in internet financing and electronic marketing. Co. serves defense and security, transport and traffic, energy and industry, telecom and media, finance and insurance, and public administration and healthcare markets. Co. operates primarily in Europe, the United States, Canada, and Latin America.
Talgo is engaged in designing, manufacturing, repairing and maintaining the railway rolling stock, as well as the manufacturing, assembling, repairing and maintaining the engines, machinery and parts of the railway systems. Co. has an industrial presence in seven countries: Spain, Germany, Kazakhstan, Uzbekistan, Russia, Saudi Arabia and U.S.A. Co. has an active fleet in Europe, Asia and North America that comprises of 94 high-speed trains and more than 1,400 Talgo tilting passenger cars. Also, Co. purchases, redesigns, constructs, leases and sells all types of real estate.
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