Markus Allenspach (Julius Baer) | We maintain our Overweight on EUR low-grade bonds against the backdrop of low money-market rates and remote recession risks. Moreover, we share the view of the market that the odds for a new corporate-sector purchase programme of the European Central Bank are rising, which could additionally lift bond prices.
Morgan Stanley | We lower profit estimates for Spanish banks at an average 4.6-5% for 2020-2021 given the sensitivity of these to a further flattening of the rate curve as a result of a more dovish ECB.
Banca March | The ECB announced other limitations on liquidity that will make it difficult for peripheral banks to access the new TLTRO III.
Bankinter | The rate of Spanish banks´non-performing loans fell in March to 5.73% (-1.07 pp m/m), the lowest level since 2010. It is good news for the sector, which confirms the improvement in the credit quality indices observed in recent years. Bad debt is therefore distancing itself from the highs of 2013 when it reached 13.61% in the middle of the economic crisis in various Eurozone countries.
Santander Corporate & Investment | The publication of results is nearing its end, and European company profits have shown resilience in face of a global environment dominated by uncertainty: the trade war, volatility in emerging markets and weakness in their currencies, Brexit, the growth of populism etc. Spanish companies are very exposed to international markets, given that only a third of their benefits come from the domestic market.
Alphavalue | Telefonica´s poor figures for Q119 traded with falls of 31%. Sales of 11.98 Bn€ › 11.81 Bn€ estimated by the consensus. Our analysts highlight that the operator improved income in all the geographic areas where it is present, especially in Spain and Brazil, its two main markets.
Link Securities | … After these rises both indices and many shares are somewhat over bought, which is why no-one should be surprised that they pit stop, even more so when considering how much they have risen since the beginning of the year.
Fernando G. Urbaneja | Deutsche Welle’s Tim Sebastian drove Spanish Foreign Minister Josep Borrell furious with very incisive, very biased and very provocative questions, repeatedly questioning the independence of the Spanish justice. However, Mr Borrell was not ready nor prepared to prove that Spanish democracy is a mature and advanced one.
Standard and Poor’s maintained Spain´s rating without changes, at A- with positive perspective. Among the reasons: the uncertainties over the next elections and the tensions in Catalonia.
Santander Research | The performance of the Eurozone economy in 2018 was far from meeting expectations. Having exceeded expectations in 2017, with GDP growth yoy of 2.5% – the strongest since the 3.1% in 2007 – the economy registered a strong slowdown in 2018 with caused up to a 1.8% fall yoy in GDP. Although, probably, the growth levels of 2017 were not sustainable – taking into account the economic fundamentals of the Eurozone and the performance of the rest of the world – , the economic slowdown was strong, especially in the second half of 2018. In quarterly terms, GDP went from growing a quarterly average of o.7% in 2017 to only 0.4% in the first half of 2018 and a quarterly average of 0.2% in 2018.