EUR 100.00 For Business Accounts Only

IBERIAN DAILY 23 AUGUST (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: CELLNEX, CONSTRUCTION SECTOR, REPSOL.

MARKETS YESTERDAY AND TODAY

Drops over the week awaiting Jackson Hole
European stock markets fell last week, hit by the clear impact from the Delta variant on economic recovery, the stricter regulatory restrictions in China and the withdrawal of the stimulus measures in the Fed meeting minutes. Thus, the Euro STOXX fell -1.72% on the week, where the best-performing sectors on the week were Household Goods and Utilities, with Consumer Goods and Retail bringing up the rear. On the macro side, in Germany July’s production prices beat expectations. In the UK, July’s retail sales came in below expectations. In the US, the Chairman of the Dallas Fed, R. Kaplan, stated that the impact from the Delta variant could lead to an adjustment to the organisation’s view on tapering if economic growth skids to a halt (to date he has been in favour of initiating tapering in October).
What we expect for today
European markets would post gains following the small rise on Friday, the doubts on increased Delta variant cases and the Jackson Hole kickoff on Thursday. Currently, S&P futures are up +0.36% (the S&P 500 ended flat vs. its price at the closing bell in Europe). Volatility in the US fell (VIX 18.56). Asian markets are rising (China’s CSI +1.29% and Japan’s Nikkei +1.85%).
Today we will learn preliminary PMIs in Germany and the euro zone (August) and in the US July’s Chicago Fed and second-hand home sales. In debt auctions: Germany (€ 4 Bn in 12M t-bills) and France (€ 5.4 Bn in 3M, 6M and 12M t-bills).


COMPANY NEWS

CELLNEX, BUY
The CMA (Competition and Markets Authority) within its phase 2 study on the acquisition of Hutch UK’s towers by CLNX (begun on 28 July and to last an additional 20-36 weeks) considers as a solution to concerns about antitrust issues in the UK that a third party could take part of the assets CLNX is seeking, and not 100%. With this in mind, the UK has now set a new deadline of 2 September for interested parties to update their analyses.
Negative news of little impact. Although we must wait for the companies to present their updated analyses, the antitrust problems (and with asset sales) could be limited to specific regions of the country with the largest concentration. Furthermore, we note that the acquisition of Hutchison’s assets included 6 deals in 6 countries, 5 of which would already be approved, and thus only HT UK would be pending, which would represent ~7.2% of EBITDA.