IBERIAN DAILY 19 JULY + 2Q’21 RESULTS. HIGHLIGHTS AND REST OF PREVIEWS (ANÁLISIS BANCO SABADELL)
NEWS SUMMARY: ENCE, FERROVIAL, MAPFRE, RED ELÉCTRICA, TELEFÓNICA, TOURISM SECTOR.At the end of today’s report, and during the entire results season, we will include a presentation with positive and negative results highlights and previews for the 2Q’20 results to be released over the coming days in Spain.
MARKETS YESTERDAY AND TODAY
A poor week for the Ibex
Friday’s drops of around -0.8% aggravated the weekly losses in the euro zone, close to -1.2%. The Ibex was the worst-performing index, after sliding around -3.5% on the week (around -8% in the past 4 weeks), where doubts on the recovery and inflation tensions continue. In the Euro STOXX, almost all sectors ended the week in negative territory, with Telecoms and Media being the best performers vs. the biggest drops of Energy and Travel&Leisure. On the macro side, in the euro zone, June’s inflation was confirmed at 1.9% YoY and in the US June’s retail sales climbed above expectations. Lastly, OPEC+ reached an agreement to raise crude oil output by 400,000 b/d per month starting in August through December (2.0 M b/d in total), expecting to resume pre-Covid production levels in Sept’22. In US business results, State Street beat expectations and Kansas City worse than expected.
What we expect for today
European stock markets would open with losses of as much as -0.5%, where the Euro STOXX could lose the 4,000-point level with oil sector in the spotlight given the drop in Brent crude prices. Currently, S&P futures are down -0.3% (the S&P 500 ended -0.52% lower vs. its price at the closing bell in Europe). Volatility in the US increased (VIX 18.45). Asian markets are falling (China’s CSI -0.1% and Japan’s Nikkei -1.3%).
Today in the US we will learn June’s NAHB index. As for auctions: Germany will issue € 6 Bn in 6 & 12M T-bills, Holland € 2 Bn in 6M T-bills and France € 5.4 Bn in 3, 6 & 12M T-bills. In US business results, Prologis, Zions BanCorp and JB Hunt, among others, will release their earnings.
COMPANY NEWS
ENCE. The Spanish High Court rules against the extension of Pontevedra plant. BUY.
The ruling of the Spanish High Court on the 60-year extension of ENC’s plant in Pontevedra (through 2073,
Ence Energia Y Celulosa is engaged in the manufacture and commercialization of wood pulp and derivatives. Co. divides its activities into the following two business lines: Forest Division: Co. manages timberlands in South America and the Iberian Peninsula. Co. is involved in trading of wood, and supplies solid wood products including: plywood, sawn timber, parquet flooring and glued-edge paneling. Co. is involved in forest and environmental consulting. Pulp Division and Energy Production: Co. is engaged in the production of Eucalyptus globulus-based TCF and ECF paper pulp. Co. is also involved in the generation of electricity through biomass power producing plants.
Ferrovial is a transportation company based in Spain. Co. is engaged in operations in the transportation sector. Co. specializes in the design, construction, management, administration and maintenance of transport infrastructures. Co.'s services range also includes the maintenance of parking lots, and land-, sea- and air-based transport networks. Co. is also engaged in the promotion and operation of short-stay parking lots, parking regulation and management services and promotion and sale of residents' parking.
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.
Telefonica is engaged in the provision of public or private telecommunications services, including ancillary or complementary telecommunications services or related services. Co.'s fixed business includes: traditional fixed telecommunication services, Internet and broadband multimedia services, data and business-aplications services, and wholesale services for telecommunication operators. Co. also provides a range of mobile and related services and products to consumer and business customers, including mobile voice services, value added services, mobile data and Internet services, wholesale services, corporate services, roaming, fixed wireless, and, trunking and paging.
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