CAPIS Global Recap – 6/27/2019

Asian Headlines On hopes of a deal, or at least progress, on a trade deal coupled with an encouraging reading out of China indices in the region closed higher today.  President Trump said a deal now could be completed at the G20 with no additional tariffs to be accessed while President Xi agreed to meet…

Asian Headlines

On hopes of a deal, or at least progress, on a trade deal coupled with an encouraging reading out of China indices in the region closed higher today.  President Trump said a deal now could be completed at the G20 with no additional tariffs to be accessed while President Xi agreed to meet with Trump on the condition no new tariffs.  After a weak April, Industrial Profits moved positive again, up 1.1%, but better nonetheless.

Energy names led with new US draw readings and Iran woes conspiring to keep oil better. $60.00 WTI though is still a resistance level with a confluence of the the 50,100, and 200 day moving averages thus far keeping a cap on prices.  Moving into European hours prices have eased somewhat.

On the equity front Japan Display closed up 18% after Apple is said to be considering injecting ¥10.7B into the firm and upping their orders as well. LCD orders from China would suffer accordingly.  Of interest, last year Apple made up over 60% of the firm’s sales.

Taiwan’s Largan Precision closed 5% higher on positive comments from their Chairman noting the 2H should surpass the 1H.  News that Apple may add three lenses to its next iPhone buoyed the name as well.

European Headlines

Indices in Europe were also to the upside but 3 hours in gave up ground.  Headlines hit that President Xi said he wants the US to drop punitive tariffs and give up demands for purchases.  Additionally, in setting terms for a deal, he demanded the sales ban to Huawei for US technology to be lifted.  The headlines of course are alarming some with Trump not known for accepting ultimatums.  Yesterday’s report that Huawei personnel worked with China’s military on projects together will certainly be a sticking point as well.

Retailers lead on H&M’s turnaround with Banks better as well.  Media and Energy names lead on the downside with losses under a percent. On the economic front EU confidence readings mostly missed survey levels but inflation readings thus far are up in Germany in the regionals.

Despite missing profit estimates Hennes & Mauritz is up 8.6% as investors view favorably their progress and paring of inventory.  The firm is pushing inline sales while cutting back on new store openings.  They again noted expectations for lower markdowns going forward.

Bayer is up 7% on confirmation Elliot Mgmt has invested in the firm to the tune of $1.3B.  They will push to get a final settlement concerning glyphosate as the chemical maker hired a high-profile lawyer to defend them.

Additive-maker Chr Hansen is off 12% after they pared FY growth views to 7-8% from the prior 9-11% expectation. The firm has seen slowing demand for dietary supplements and natural colors prompting a curtail of their sales outlook.

Things are bit better today at Zumtobel +10% with better revenues expected this year. An improved cost structure has allowed for improved margins despite noting the market environment weakening.

Automotive/aerospace product-manufacturer Senior -11% was downgraded by Barclays with the firm said to be heavily dependent upon Boeing’s beleaguered 737 Max.

Event Survey Actual Prior Revised
SK 13) Business Survey Manufacturing Jul 75 75
SK 14) Business Survey Non-Manufacturing Jul 74 72
JN 15) Retail Sales YoY May 1.20% 1.20% 0.50% 0.40%
JN 16) Retail Sales MoM May 0.60% 0.30% 0.00% -0.10%
JN 17) Dept. Store, Supermarket Sales YoY May 0.20% -0.50% -1.80%
JN 18) Japan Buying Foreign Bonds 21-Jun ¥445.4b ¥327.3b ¥330.5b
JN 19) Japan Buying Foreign Stocks 21-Jun ¥256.0b ¥232.5b
JN 20) Foreign Buying Japan Bonds 21-Jun -¥2012.4b ¥471.7b ¥535.7b
JN 21) Foreign Buying Japan Stocks 21-Jun -¥313.4b -¥95.4b -¥94.3b
CH 22) Swift Global Payments CNY May 1.95% 1.88%
CH 23) Industrial Profits YoY May 1.10% -3.70%
SK 24) Department Store Sales YoY May 2.70% -3.80%
SK 25) Discount Store Sales YoY May -3.60% -7.70%
CH 26) Bloomberg June China Economic Survey (Table)
NE 27) Producer Confidence Index Jun 3.3 4.7
IN 28) Bloomberg June India Economic Survey (Table)
FI 29) Consumer Confidence Jun -4.6 -1.8
FI 30) Business Confidence Jun -5 1
FI 31) Retail Sales Volume WDA YoY May P -0.30% 3.60%
FI 32) House Price Index MoM May -0.10% 0.40% 0.50%
FI 33) House Price Index YoY May -1.00% 0.00% 0.10%
NO 34) Retail Sales W/Auto Fuel MoM May -1.00% -1.30% 1.80% 1.90%
GE 35) CPI Saxony MoM Jun 0.50% 0.30%
GE 36) CPI Saxony YoY Jun 1.80% 1.40%
SP 37) Total Mortgage Lending YoY Apr -2.50% 23.20%
SP 38) House Mortgage Approvals YoY Apr -0.10% 15.80%
SP 39) CPI MoM Jun P 0.00% -0.10% 0.20%
SP 40) CPI YoY Jun P 0.60% 0.40% 0.80%
SP 41) CPI EU Harmonised MoM Jun P 0.00% -0.10% 0.20%
SP 42) CPI EU Harmonised YoY Jun P 0.70% 0.60% 0.90%
CH 43) BoP Current Account Balance 1Q F $49.0b $58.6b
SW 44) Trade Balance May 8.3b 1.4b 1.2b
GE 45) CPI Brandenburg MoM Jun 0.50% 0.30%
GE 46) CPI Brandenburg YoY Jun 1.80% 1.30%
GE 47) CPI Hesse MoM Jun 0.10% 0.40%
GE 48) CPI Hesse YoY Jun 1.50% 1.40%
GE 49) CPI Bavaria MoM Jun 0.40% 0.10%
GE 50) CPI Bavaria YoY Jun 1.80% 1.60%
IT 51) Consumer Confidence Index Jun 111.4 109.6 111.8 111.6
IT 52) Manufacturing Confidence Jun 101 100.8 102 101.9
IT 53) Economic Sentiment Jun 99.3 100.2
GE 54) CPI North Rhine Westphalia MoM Jun 0.20% 0.20%
GE 55) CPI North Rhine Westphalia YoY Jun 1.70% 1.60%
AS 56) WIFO Quarterly Economic Forecasts
PO 57) Consumer Confidence Index Jun -8.3 -9
PO 58) Economic Climate Indicator Jun 2.4 2.3
EC 59) Economic Confidence Jun 104.8 103.3 105.1 105.2
EC 60) Business Climate Indicator Jun 0.27 0.17 0.3
EC 61) Industrial Confidence Jun -3 -5.6 -2.9
EC 62) Services Confidence Jun 12.4 11 12.2 12.1
EC 63) Consumer Confidence Jun F -7.2 -7.2 -7.2
BE 64) CPI MoM Jun -0.06% 0.02%
BE 65) CPI YoY Jun 1.73% 1.89% 1.90%
GE 66) CPI MoM Jun P 0.20% 0.20%
GE 67) CPI YoY Jun P 1.40% 1.40%
GE 68) CPI EU Harmonized MoM Jun P 0.10% 0.30%
GE 69) CPI EU Harmonized YoY Jun P 1.30% 1.30%
GE 70) CPI Baden Wuerttemberg MoM Jun 0.20%
GE 71) CPI Baden Wuerttemberg YoY Jun 1.50%