EUR 100.00 For Business Accounts Only

IBERIAN DAILY 23 NOVEMBER (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: BANKING SECTOR, ELECTRICITY SECTOR, ROVI.

European stocks rally
The European stock markets rallied despite the rise in Covid-19 cases in China and a worsening outlook for 2023. Thus, although the OECD raised its growth forecast for the Euro zone in 2023 (+0.5% +02pp) and 2024 (1.4%), it expects the United Kingdom and Germany to fall into recession next year. As for the US, the OECD expects it to grow by 0.5% in 2023 (+0.3pp) and 1.0% in 2024 (unchanged). Within the Euro STOXX, Energy (oil rallied sharply) and Basic Resources led gains, whereas Real Estate and Consumer Goods were among the few sectors that ended in the red. On the macro side, in the Euro zone, November’s consumer confidence recovered somewhat more than expected. On another note, the OECD cut its GDP’23 growth forecast for Spain to 1.3% (vs. 1.5% previously), expecting a 1.7% increase in 2024. Its global GDP’23-24 forecast remains unchanged at 2.2% and 2.7%, whereas the Euro zone’s GDP would increase to 0.5% (vs. 0.3% previously) and 1.4%. Lastly, the EU has proposed a gas cap at € 275/MWh that would apply if prices exceeded this level for two weeks and the difference with the average liquified gas price is higher than € 58 over a 10-day period. In the US, the Richmond manufacturing index improved less than expected in November.
What we expect for today
The European stock markets would open with slight gains of as much as +0.5% that would be erased throughout the session. Currently, S&P futures are down -0.1% (the S&P 500 ended +0.61% higher vs. the European closing bell). Volatility in the US dropped (VIX 21.29). Asian markets are climbing (China’s CSI 300 +0.1% and Japan’s Nikkei +0.65%).
Today we will learn in the Euro zone November’s preliminary manufacturing and services PMIs, in the UK November’s preliminary manufacturing and services PMIs, and in the US October’s preliminary durable goods orders, weekly jobless claims, October’s new home-sales and the Fed minutes. In debt auctions: Germany (€ 1 Bn in bonds due 2053).


COMPANY NEWS
ROVI. First impressions on the CMD presentation. BUY.
From the presentation released today for its CMD (10:00 CET), there are no changes in forecasts. Thus, the company reiterates its 2023 guidance of lower revenues by between -10% and -20% vs. +0% BS(e), which we continue to see as conservative. As for Risperidone ISM (11% T.P.; already approved by the EMA), the group expects the FDA approval by July’23, which means a delay vs. our forecast (4Q’22) although not seeing approval risk, which should help dispel doubts. As regards Letrozol ISM (18% T.P.), the company announced it will initiate phase II efficacy tests with the FDA in the 2H’23. We maintain a positive stance, not foreseeing a relevant impact despite its poor performance (-44% in 2022; -40% vs. IBEX).