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IBERIAN DAILY 16 MARCH (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: MAPFRE, SANTANDER.

The war in Iran continues
European stock markets fell last week, with the Euro STOXX 50 and Ibex 35 on the verge of falling below the 5,700 and 17,000 point support. In the STOXX 600, the best-performing sectors were Energy (thanks to the hike in Brent crude prices) and Utilities, whereas Real Estate and Consumer Goods suffered the biggest corrections last week (around -4.0%). On the macro side, in Spain, February’s final inflation confirmed the preliminary data of 2.3% (in line), whereas the core data speeded up one tenth to 2.7%. In the euro zone, January’s industrial output slowed down unexpectedly. In France, the far right won the first round of local elections. In the US, in the second reading of the 4Q’25 GDP growth was revised to 0.7% q/qa (worse) due to the lower contribution from private consumption and investment. However, January’s personal outlays rose more than expected, suggesting still dynamic private consumption in the 1Q’26. Preliminary core capital goods orders stagnate in January unexpectedly, which could halt the recovery of investments in capital goods. January’s JOLTS job vacancies rose far above expectations and the University of Michigan consumer confidence moderated slightly less than expected in March. Separately, the judge rejected the accusations against J. Powell, finding no evidence against him. In China, February’s industrial output, retail sales and investment in fixed assets recovered more than expected, although housing prices steepened their YoY fall. In geopolitics, Trump warned NATO on its future if it does not aid the US in controlling the Strait of Hormuz, also suggesting that the meeting with Xi Jinping will be pushed back if China does not collaborate. Meanhwile, talks between different countries and Iran have intensified in order to reopen the Strait of Hormuz. In trade matters, Mexico, Canada and the US have started talks for a new trade agreement.
What we expect for today
European stock markets would open with gains of around +0.5%. Currently, S&P futures are up +0.55% (the S&P 500 ended +0.35% higher vs. the European closing bell). Asian markets are mixed (China’s CSI 300 -0.12%, Japan’s Nikkei -0.20% and South Korea’s Kospi +1.3%).
Today in the US we will learn March’s Empire manufacturing index, February’s industrial output and capacity utilisation and March’s residential confidence index (NAHB).


COMPANY NEWS

MAPFRE. 2026 targets revision. UNDERWEIGHT
At the AGM held last Friday, MAP revised its targets for the last year of its 2024-26 plan: (i) Premiums: the +6% premium increase guidance remains unchanged but now excludes the currency impact (consensus +0% including currency); (ii) the RoE target was raised from 11-12% to >13% (consensus 12.7%), the level reached in 2025 excluding the one-off goodwill and DTAs impairment (12.4% reported); (iii) the combined ratio (CR) was raised by 1p.p. to 93-94% (vs. 92.2% in 2025 and 93% consensus for 2026). On another note, MAP warns that if inflation increases signficantly it will have to moderate these targets. We do not foresee a relevant impact, as the improvement of the profitability and CR ratios is positive news but partially expected bearing in mind the performance seen in 2025 and the consensus estimates. On another note, and as in the rest of the sector we believe that the inflationary risk stemming from the war in Iran could continue to weigh on the share price in the short-term.