Santander | The arrival of the new government in Spain is good news for the gas and electricity markets, given that it is probable that it will respect the regulatory periods; it appears more focused on the spirit of the law (“fair returns”) than on the application of methodologies (differential over 10 year bonds) and it has the intention of reinforcing the role of the CNMC as an independent regulator.
Shaun Riordan | The currency markets seem to have given the Turkish Lira a temporary respite. But the underlying problems remain the same: an unsustainable current account deficit; excessive dependence on foreign currency denominated (especially dollar denominated) debt; and high inflation.
Bankinter | Unicredit´s ordinary BNA has fallen to 1.024 billion euros in the second quarter of 2018 (Q2 2018) (-13.3%) but has beaten expectations. The principle figures compared with expectations for Q218 (Reuters): Gross Margin: 4.947 M€ (-4.3%; -3.3% t/t); provisions: -504 M€ (-23%; 1.5% t/t); BNA: 1.024 B€ (-13.3%; -7.9% t/t vs 975 M€ expected).
Alphavalue | The results season has passed half way and the balance is positive, again more so in the US than in Europe, but with solid figures on both sides of the pond.
Bankinter | We are revising our recommendation for BBVA to Neutral from Buy because of the deterioration of the situation in Turkey.
Ofelia Marín-Lozano | A decade after the beginning of the financial crisis, net profits in the Spanish banking sector continue the upward trend begun in 2012, but the profit per share is much less favourable. Given that the number of shares has increased (overall, more tan double the number in 2007), the net profit per share is less than a half pre-crisis levels.
Facebook and Twitter have been significantly punished by investors following figures about users which created doubts about the performance of both companies in the future. In the first case, the number of users active per month increased 1.74% in 2018 to pass from 2.196 millions to 2.234 million, disappointing market expectations and delivering the smallest increase since Facebook provided figures.
Last Friday the expected news arrived of the interest of Hyatt Hotels Corp in the Spanish hotel chain. The Chicago based company showed its interest in acquiring NH Hotels, through an alternative (or negotiation money) for the shareholders of NHH to the existing offer of Minor. But just as the offer arrived, it has evaporated and yesterday Hyatt stepped back from its counter bid for NHH.
Mark Tinker Chief Economist at AXA IM Framlington Equities in Asia reminds us in one of his last notes of the stark contrast between the institutional investor in the west and the emerging retail and wholesale investors in the east. Western pension funds have long since abandoned the cult of the equity, the dominant alternative asset remains is Private Equity. The industry overall took in a record $453bn last year.
Repsol has reached agreement to acquire 40% of Mexican lubricant company Bardahl, which represents its biggest purchase in this business and pushes forward its internationalisation strategy in Downstream.