That’s what investors who started picking up US tech stocks on Friday seem to think. Rather qualitative at the beginning, then a bit of everything yesterday. A rebound movement driven by large caps, evidenced by the gains of 2 to 8% for files such as Amazon, Apple, Nvidia or ASML. And a big +10.7% increase for Tesla, which definitely does nothing like the others. The rebound went beyond those names as shown by ETF ARK Innovation’s 9.5% surge in yesterday’s session alone. ARK is a leveraged Nasdaq, heavily invested in Tesla. It is a good indicator of risk appetite.
In any case, these two rebound sessions have done the American indices a world of good and allow January 2022 to avoid entering the annals of the stock market. Thanks to its rebound on January 28 and 31, the Nasdaq 100 will have lost “only” 9% and will not have broken the record of January 2008, at -10%. As for the S&P500, it will have limited the breakage to -5.3%, a poor performance certainly but much better than that of its most spectacular recent plunge, that of March 2020 (-12.5%). In Europe, the balance sheet for January is negative but has never seemed catastrophic as it may have been in the United States. The broad STOXX Europe 600 index posted an underperformance of 3.9%. As for the CAC40, even if facetious algorithms made it cap at 6999 points yesterday at the close, it will have lost only 2.15% on its levels of 1er January.
Will January’s cleanup be enough to allay deep-seated market fears? Investors rely on the quarterly results of companies, always good, to justify their appetite. FOMO, the fear of missing out on what others enjoy, hasn’t gone away. This powerful current also works when it comes to repositioning to accompany a rebound. That’s kind of what’s going on right now. Today, around fifty listed companies with a capitalization of more than $10 billion will reveal their accounts, including Exxon, Starbucks and General Motors before the US opening, then Alphabet, PayPal and Advanced Micro Devices post-closing. In Europe, UBS, Novozymes, Vantage Towers or Lundin Energy are scheduled (apparently, we do not publish the 1er February in France, perhaps out of respect for Cloclo). Enough to continue to feed the statistics machine on the content of the results, statistics which, I repeat, remain solid.
A hook this morning by a German non-decision which is in fact a decision of technological sovereignty. Berlin has missed the deadline for reviewing the takeover of Siltronic by the Taiwanese GlobalWafers. In other words, the suitor was not authorized to buy Siltronic, the world number four in silicon wafers. In this industry made up of five dominant players, the German has a 13% market share, which means that it is a strategic player and a major supplier of key semiconductor companies in Europe, such as STMicroelectronics and Infineon. Europe understands quickly but it takes a long time to explain to it: no technological independence without actors rooted in the territory.
European leading indicators are bullish this morning and nothing should prevent the CAC40 from returning to 7000 points at the opening. The index gained 0.7% to 7050 points at the start of the session. A green Tuesday rather than a red Tuesday therefore (a pretext to re-listen to Ruby Tuesday by the Stones?). In Asia, Tokyo digested its rebound from the previous day but closed slightly higher. The Lunar New Year festivities have started in China, Hong Kong and Korea in particular, so the markets are closed. Sydney gains 0.5%. This optimistic picture should not make us forget that there is still a background of nervousness on the markets and that the VIX volatility index, although it is clearly on the downward slope, nevertheless remains at levels higher than the average.
Economic highlights of the day
The final PMI indices for January will be released throughout the day. In Europe, the German (9:55 a.m.) and European (11:00 a.m.) monthly unemployment figures are expected in the morning. In the United States, the manufacturing PMI (3:45 p.m.) will be followed at 4:00 p.m. by construction spending, the manufacturing ISM and the JOLTS survey on job openings. This morning, the Australian central bank announced the end of its bond buying program this month.
The euro rose to 1.12429 USD. The ounce of gold remains just under 1800 USD. After falling yesterday, the barrel rose slightly to 89.55 USD for Brent and to 88.44 USD for WTI. The yield on US debt is unchanged over 10 years, at 1.77%. Bitcoin goes back to 38,541 USD.
The main changes in recommendations
- Adidas: Berenberg remains on the buy side with a price target reduced from 360 to 320 EUR.
- Alten: Berenberg remains long with a price target raised from 160 to 172 EUR.
- Avantium: Bryan Garnier starts the follow-up on the purchase by targeting 10 EUR.
- Barry Callebaut: Baader Helvea goes from reducing to accumulating by aiming for 2250 CHF.
- Deutsche Telekom: Berenberg remains long with a price target raised from 22 to 27 EUR.
- Deutz: DZ Bank remains long with a reduced target price of 8.70 to 8.40 EUR.
- EssilorLuxottica: Berenberg remains long with a price target raised from 200 to 210 EUR.
- Grupo Catalana Occidente: Oddo BHF starts outperformance tracking by targeting EUR 35.
- Hugo Boss: Stifel goes from holding to buying, aiming for 70 EUR.
- Intesa: Jefferies remains to be kept with a price target raised from 2.65 to 2.70 EUR.
- Leonardo: Deutsche Bank resumes the follow-up to be kept by targeting EUR 7.60.
- LVMH: Berenberg remains on the buy side with a price target raised from 775 to 840 EUR.
- Mapfre: Oddo BHF resumes outperformance monitoring by targeting EUR 2.40.
- Moncler: Berenberg is still buying with a price target raised from 53 to 57 EUR.
- Orsted: Citigroup goes from sell to neutral, targeting 680 DKK.
- Proximus: Citigroup goes from neutral to sell, targeting EUR 16.60.
- Puma: Berenberg remains long with a target price reduced from 120 to 115 EUR.
- Safran: Deutsche Bank goes from holding to buying, targeting EUR 125.
- Saipem: AlphaValue switches from accumulating to selling targeting EUR 0.81.
- Shell: Berenberg remains on the buy side with a price target raised from 24 to 27.50 EUR.
- SLM Solutions: Jefferies is starting to track longs, aiming for EUR 22.
- Swedish Match: Morgan Stanley goes from overweight to weighted online by targeting 80 SEK.
- Thule: Pareto Securities goes from hold to buy targeting 515 SEK.
- TotalEnergies: Berenberg remains to be kept with a price target raised from 50 to 54 EUR.
In France
Important (and less important) announcements
- New vehicle registrations were down 18.6% in France in January, according to the PFA.
- Stellantis could cut up to 1,400 additional jobs in France this year through voluntary departures, a number similar to the departures recorded in 2021, according to Reuters.
- TotalEnergies buys service stations and other assets in Mozambique from BP. The group could restart its LNG project in the country this year.
- Boursorama (Societe Generale) is negotiating the takeover of ING’s banking customers in France.
- Suez / Veolia has completed the sale of the “new Suez” to the consortium of investors.
- Sodexo’s honorary president, Pierre Bellon, has died.
- Faurecia has completed the takeover of Hella for €5.3 billion and becomes the world’s 7th largest automotive supplier.
- The leaders of Orpea are summoned by the government.
- Valneva is launching a phase III trial in adolescents for its single-shot chikungunya vaccine candidate.
- Solutions 30 acquires Polish Sirtel (€3 million in annual revenue).
- The negotiation agreement between Pierre & Vacances and its potential buyers extended to February 18.
- Inventiva receives a €4 million milestone payment from AbbVie following the launch of the Phase IIb study with cedirogant.
- Carmat is expected to resume implanting its Aeson artificial heart in October 2022.
- Olympique Lyonnais signs Romain Faivre for €17m.
- Groupe Gorgé is developing its expertise in autonomous robotics.
- Europlasma considers the plasma tests carried out in China on the recovery of hazardous aluminum waste to be conclusive.
- Prologue shareholders validate the transfer on Euronext Growth.
- AST Groupe receives €1.6 million in public aid.
- OSE Immuno receives a milestone payment of €5m as part of the agreement with Veloxis.
- SpineGuard submits its dossier to the United States to approve PediGuard in anterior vertebral surgery.
- Elis, Graines Voltz, Cafom, Ecoslops, Emova, Neolife, Munic, Delta Drone, Adomos, Theraclion, Genoway, Groupe Pizzorno have published their accounts.
In the world
Important announcements (and others)
- The American FTC will examine the agreement between Microsoft and Activision.
- UBS Group beats Q4 expectations and will buy back $5bn of shares this year.
- Siltronic will ultimately not be acquired by GlobalWafers, after Berlin’s implicit veto.
- Sony Interactive Entertainment is buying Bungie for $3.6 billion.
- SIG Combibloc buys Scholle IPN for €1.36 billion.
- Novozymes’ operating profit below expectations.
- Meta (Facebook) definitively buries Diem, ex-Libra, its ambitious cryptocurrency.
- Qatar Airways signs acquisition of B777 freighters and B737MAX from The Boeing Company.
- The New York Times buys Wordle pun.
- Stadler Rail wins a contract in Serbia.
- Glencore sells its logistics subsidiary Target Group for $177 million.
- Exxon will merge two entities and move its headquarters to Houston.
- Main results publications : Alphabet, Exxon, PayPal, United Parcel Service, Keyence, UBS Group, Novozymes, Vantage Towers, Nomura, Lundin Energy… Find the full agenda for the day here.
Readings