Santander Corporate & Investment | Waiting for PMI business confidence indicators to show signs of substantial improvement and in the absence of developments in trade negotiations, interest rates on government bonds have receded slightly, which has again given prominence to defensive companies while cyclicals take a break after the rally that began in September.
José A. Santos (Patrivalor) | The stock valuation of the 60 Spanish companies amounted 609.718 billion euros at the end of November 2019, which represents an increase of + 8% compared to the end of 2018.
Cellnex has reached an agreement with Orange Spain to acquire a portfolio of 1,500 telecommunications sites, which means 11% of the current Cellnex portfolio in Spain, and 4% of the total portfolio of towers and antennas located in urban, suburban and rural areas. The operation involves an overall investment of € 260 M. The acquisition will be financed through available cash.
Repsol expects to adjust the accounting value of some assets, with a post-tax accounting charge of approximately 4.8 billion euros in order to achieve net zero emissions by 2050. This adjustment will reduce specific reported income for 2019 but does not alter the company’s cash flow for the year nor the announced proposal to increase shareholder remuneration.
BOfAML | We see a lower percentage of SKUs on discount in November compared to November 2018, which reflects a less aggressive discounting strategy by Zara in 2019, in our view.
Morgan Stanley | Bank analysts raised the sector to Attractive a few weeks ago because our macro no longer expects depo-type cuts and this increases confidence that profit estimates have hit a minimum in 2H19. We estimate a flat growth of the NII (+ 0.6%) in 2020 and 2021. There is optionality in the charge for deposits (could add 3% to the NII of the Eurozone banks).
In their “European Banks: At a turning point?”, Morgan Stanley analysts explain that interest rates are still low but seem to have reached their bottom and that they don’t expect any further cuts to depo rates.
Banco Santander has been named Bank of the Year in Western Europe, the Americas, Spain, Portugal, Argentina and Chile by The Banker magazine. The Banker recognized the bank’s “peerless commitment to an enhanced customer experience”, its pursuit of operational efficiency and its development of new digital, global trade and global merchant services.
Iberdrola will promote via its subsidiary Scottish Power Renewables a marine wind mega-project, called East Anglia Hub, which will add an installed capacity of 3,100 MW and involve an approximate investment of 6,500 million pounds (more than 7,600 million euros). The three projects will be procured together to leverage their scale with a continuous installation programme.
Unigestion | With the third quarter earnings reporting season behind us and investors looking at what’s ahead for equities, it is helpful to distinguish between short-term and longer-term factors. Over the short term, the context for stocks looks supportive, if perhaps less so than it did a couple of months back. However, pressures are building that may become significant headwinds for some firms.