DJ Global Equities Roundup: Market Talk

The latest Market Talks covering Equities. Published exclusively on Dow Jones Newswires throughout the day.

1011 GMT - Saint-Gobain's new management team, led by CEO Benoit Bazin, could reorient the company, with its capital markets day on Wednesday set to be a positive catalyst for a rerating, Bryan Garnier says. Short-term momentum is strong, with a solid renovation market, while the group's ability to increase prices looks solid, the brokerage says. Saint-Gobain's current valuation, if in line with the historical averages, suggests markets aren't pricing in a rerating for the shares, but BG expects this to gradually change. The bank raises its EBIT estimates by 2% for 2022 and 2023 on average. BG upgrades the stock to buy from neutral with a higher EUR80 target price. (edward.frankl@dowjones.com)

1010 GMT - Greencore's labor, input and packaging costs have risen around 5% in 4Q, Peel Hunt says. However, the convenience-foods manufacturer is in negotiations with customers to pass these costs on, which, in light of the broad nature of inflation in the economy, should prove more constructive than in previous years, the U.K. brokerage says. Encouragingly, the company has managed labor shortages and supply chain issues reasonably well during its peak period, and inflation--which is generally helpful for food retailers--could be around 5% by Christmas, it says. "We expect to nudge up our 2021 estimate forecast, but see no change to our 2022 estimates." Peel Hunt rates the stock buy. (anthony.orunagoriainoff@dowjones.com)

0943 GMT - Price movements in the eurozone continue to surprise to the upside, Oxford Economics senior economist Ricardo Amaro says. Eurozone headline inflation rose to a thirteen-year high of 3.4% in September, above the consensus of a rise to 3.3%. "The surge in headline inflation from negative territory at the end of 2020 reflects the combination of low base effects from last year and stronger-than-expected momentum in recent months, mainly due to the spike in energy prices," Amaro says. With both factors expected to continue to push inflation higher in the coming months, Oxford Economics expects eurozone inflation to spike towards 4% in the fourth quarter and to stay above 2% in the first half of 2022, before falling below 1% in late-2022. (maria.martinez@wsj.com)

0940 GMT - BMW's raised guidance for full-year auto EBIT margins came as a surprise given the continuing semiconductor shortage, but this more upbeat outlook will in all likelihood be an exception in the sector, Nord/LB says. "While more than five million cars can't be produced or delivered this year worldwide across all companies due to the supply bottlenecks, BMW should still manage relatively well here with only 90,000 to 100,000 vehicles," the bank says. Pointing to the recent guidance cut by auto-parts supplier Hella, Nord/LB expects other companies in the auto industry to issue downgraded outlooks as the sector continues to face chip troubles. Nord/LB raises its rating for BMW to buy from hold and increases the price target on the stock to EUR93 from EUR84. Shares in BMW trade 1.8% higher at EUR84.21. (kim.richters@wsj.com)

0939 GMT - Singapore shares close lower, as property and travel-related stocks fall amid rising Covid-19 cases in the country, leading the benchmark FTSE Straits Times Index to decline 1.2% to 3051.11. Singapore reported 2,478 new Covid-19 cases on Thursday, compared with 2,268 the previous day. Property-related stocks were lower, with Mapletree Logistics Trust down 2.0%, CapitaLand Investment slipping 1.8% and City Developments shedding 1.5%. Flag carrier Singapore Airlines and airline-caterer SATS dropped 1.0% and 1.4%, respectively. The index's largest decliner was Jardine Matheson Holdings, slipping 3.1%, after announcing share buybacks worth US$250 million. (yongchang.chin@wsj.com)

0926 GMT - Shares in AO World drop by a fifth after the online consumer-electronics retailer said a shortage of delivery drivers and continuing supply-chain disruption had hit first-half trading and forecast lower full-year earnings. AO's U.K. revenue growth has fallen short of analysts' expectations and its German operations have also slowed, AJ Bell says. "Selling fridges, televisions and washing machines online is a low-margin business and success is down to achieving high sales volumes. With cost pressures intensifying and sales volumes disappointing, AO faces a big squeeze on profits," AJ Bell investment director Russ Mould says. (philip.waller@wsj.com)

0921 GMT - Diageo is doing pretty much everything right, not least investing significantly and consistently in its brands despite the pandemic, RBC says. The bank upgrades its financial forecasts for Diageo for the next three fiscal years, following a positive trading update on Thursday. For the current year ending June 30, RBC raises the revenue estimate to GBP13.7 billion from GBP13.0 billion, and Ebita to GBP4.2 billion from GBP4.0 billion. As a result, the target price is upgraded to 3,000 pence from 2,800 pence. However, the current share price fully reflects Diageo's value, RBC says as it reaffirms a sector perform rating on the liquor maker. (jaime.llinares@wsj.com)

0917 GMT - Malaysia's benchmark Kuala Lumpur Composite Index closed 0.9% lower at 1524.48, with over two-thirds of blue chips succumbing to selling pressure ahead of the weekend. The KLCI's weakness was in line with the performance of key regional markets, which tracked the negative sentiment on Wall Street overnight as investors reacted to inflation worries, said Rakuten Trade equity research vice-president Thong Pak Leng. He expects the KLCI to consolidate further next week, with immediate support around 1520. Top Glove was down 4.5%, Maxis Bhd. fell 3.2% and Dialog Group declined 2.9%. Sime Darby Plantation gained 1.7% and Hong Leong Bank rose 1.1%. (chester.tay@wsj.com)

0912 GMT - European markets fall as investors sit on the sidelines amid lingering global economic concerns. The Stoxx Europe 600 drops 0.9%, the FTSE 100 and DAX retreat 0.8% and the CAC 40 is down 0.7%. Brent crude subsides 0.6% to $77.85 a barrel. Financial and construction stocks lead the pan-European market lower. "Investors are digesting the prospect of a much less supportive environment--tapering--while expectations of slower growth caused by poor economic data are piling up in many areas," ActivTrades analyst Pierre Veyret says. "In addition, lingering concerns regarding energy supply and, more generally, rising prices and inflation also contributed to denting this week's market sentiment." (philip.waller@wsj.com)

0909 GMT - About You has plenty of growth potential thanks to its focus on the booming e-commerce sphere and a young audience, Baader Helvea says, starting coverage of the German fashion retailer with an add rating and a EUR27 target. About You, which listed in Frankfurt in June, looks set on becoming a leading global platform, offering online window-shopping and smartly targeting younger consumers via social media, Baader analyst Volker Bosse says. With Europe's online fashion market set to grow rapidly, perhaps reaching 50% penetration in the long term, About You has much potential, Bosse says. Shares edge up 0.8% to EUR24.69. (joshua.kirby@wsj.com; @joshualeokirby)

0854 GMT - J.D. Wetherspoon's relentless consumer focus, larger-scale pubs, keen pricing and populous locations should lead to market share gains, considering the material capacity reduction across the hospitality sector, Jefferies says. Recent trends show continuing improvement in like-for-like sales, the U.S. bank says. Shares in the U.K. pub chain edge up 0.1% to 1,044 pence after it reported a widened loss for the year ended in July, when sites were closed for 19 weeks due to coronavirus restrictions. Jefferies has a buy rating on the stock with a 1,675 pence target price. (jaime.llinares@wsj.com)

0853 GMT - Hutchison Port Holdings Trust is set to benefit from a rise in shipping activity, as a strong performance by its Yantian and Kwai Tsing ports should support earnings, DBS Research says. Throughput at the two facilities are stronger than expected, with year-to-date volumes at Yantian rising 9.0% on year and up 3.4% at Kwai Tsing. The bank raises its 2021 earnings forecast by 33% and for 2022 earnings by 10% on stronger-than-expected 1H results, expecting "a sustained period of recovery" ahead. DBS keeps a buy rating and revises up the target price to $0.33 from $0.32. Shares are 2.1% lower at $0.24. (yongchang.chin@wsj.com)

(END) Dow Jones Newswires

October 01, 2021 06:11 ET (10:11 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.