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DJ Global Equities Roundup: Market Talk

· 02/05/2021 05:03

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

1003 GMT - Base metals jump as investors' appetite for riskier assets returns amid hopes for the U.S. economy and stimulus measures. Three-month copper on the LME rises 1.3% to $7,912 a metric ton, aluminum gains 0.8% to $2,011 a ton and nickel rose 1.7% to $17,905 a ton. Global markets see riskier assets--such as stocks, oil and base metals--rising in tandem. "Risk appetite continued to surge in response to more vaccines being available in the U.S. and better-than-expected initial unemployment claims," says TD Securities. Investors are also hopeful that the Biden administration can pass another round of stimulus measures, providing extra support to the U.S. economy. (william.horner@wsj.com)

1000 GMT - Vinci's 2020 results showed an exceptionally strong free cash flow that supported a dividend in line with the previous year, UBS says. The French construction and infrastructure company's FCF generation was nearly flat year-on-year at EUR4 billion, compared with UBS's expectations of EUR2.1 billion. This was partly driven by a working-capital inflow of EUR2.3 billion, which led to net debt at EUR18 billion at year-end--around EUR2 billion below UBS's estimates. "As a result of this strong cash generation, Vinci is keeping the dividend flat at EUR2.04 vs consensus of EUR1.30," the bank says. Shares trade 5.6% higher at EUR85.82. (giulia.petroni@wsj.com)

0959 GMT - Carlsberg's cautious guidance should have been widely anticipated, says Jefferies. The brewer guided for 2021 organic Ebit growth of 3%-10%, against consensus of 10.5%. "We see opportunities for positive earnings momentum through the year as recovery comes through." Jefferies says that Carlsberg shares aren't expensive, but it prefers AB Inbev and Heineken, which are less well-liked and have greater gearing to recovery. Carlsberg shares rise 3.3%. (dominic.chopping@wsj.com)

0954 GMT - European stocks gain after mixed trading in Asia, a higher Wall Street close and ahead of U.S. job data later. The Stoxx Europe 600 rises 0.4%, the CAC-40 is up 1%, the DAX advances 0.2% and the FTSE 100 increases 0.1%. The price of a barrel of Brent crude gains 1.2% to $59.52 while gold and silver prices rise. The FTSE MIB climbs 1.2% on continued optimism about a potential new Italian unity government under former ECB boss Mario Draghi. "Europe was largely quiet, hesitant to do too much until Friday afternoon's U.S. non-farm payroll numbers," says Connor Campbell at Spreadex. "The markets did still err on the positive side, however." (philip.waller@wsj.com)

0945 GMT - The agreement for RTL Group to sell its U.S. ad-tech company SpotX to Magnite for $1.17 billion in cash and stock is expected to strengthen the dividend payout for shareholders of the Luxembourg-based media company, Citi says. "The price RTL has received for SpotX is higher than we expected and shareholders should benefit from this as the capital gain will boost the dividend pay out in 2021," Citi says. The transaction is expected to close in the second quarter of 2021. RTL Group shares trade 6% higher at EUR46.56. (mauro.orru@wsj.com; @MauroOrru94)

0935 GMT - Singapore shares nudged higher amid risk-on sentiment driven by strong U.S. data and optimism that the rollout of Covid-19 vaccines in the U.S. could lead to the reopening of the world's largest economy. The FTSE Straits Times Index closed 0.05% higher at 2907.11, led by a mixed bag of companies. Mapletree Logistics Trust added 1.0%, Sembcorp Industries rose 0.6% and Genting Singapore gained 0.6%. (ronnie.harui@wsj.com)

0933 GMT - Gold rises but is still on course for its worst week since the start of the year, as U.S. Treasury yields climb. Comex futures are up 0.9% at $1,807.50 a troy ounce, but the metal slumped below $1,800 an ounce on Thursday for the first time since November. Hopes for U.S. stimulus measures helped Treasury yields firm, weakening the appeal of gold as a haven asset. "The prospect of a juicy wave of government spending and borrowing sent longer yields higher," says Jeffrey Halley, market analyst at Oanda. "The risks are skewed towards more downside pain for a structurally long gold market as the weekend approaches," he says, adding that U.S. jobs data due out later Friday would be key. (william.horner@wsj.com)

0932 GMT - Dassault Systemes had a strong 4Q but newly issued non-IFRS guidance for 2021 is below consensus estimates, Berenberg says. The French software maker expects 2021 revenue to be between EUR4.72 billion and EUR4.77 billion, and operating margin around 30.8%. The revenue forecast is 1.1% below consensus of EUR4.81 billion, Berenberg says, while operating margin is almost in line with consensus. "We believe investors consider the guidance to be conservative, which aided the stock in reaching all-time highs," Berenberg says, as shares rose around 8% Thursday after 4Q results. Dassault Systemes shares trade 1.9% higher at EUR183.70. (mauro.orru@wsj.com; @MauroOrru94)

0924 GMT - Sportech seems well positioned to keep shareholders happy and capitalize on the U.S. regulatory environment, Peel Hunt says. The betting-technology company has disposed of non-core businesses and enjoys an overall positive cash performance, the brokerage says. "Sportech has the potential to return capital to shareholders and to benefit from the regulation of sports betting in Connecticut, if that were to be permitted," it says. Peel Hunt has a buy rating on the stock and a target price of 40 pence. (matteo.castia@dowjones.com)

0924 GMT - The coronavirus pandemic has catalyzed the already existent trend of a shift to online retail in the U.K. and some retailers might ultimately emerge as winners from the change, Shore Capital says. "For the offline survivors, with much capacity removed, brighter times may be ahead, while most retail and food and beverage businesses have structurally enhanced their online capabilities," the investment group says. The nature and extent of remote working and its effects on urban centers may also bode well for the food and beverages industry in the long term as the current adjustments work through, Shore says. (matteo.castia@dowjones.com)

0917 GMT - Malaysia's benchmark Kuala Lumpur Composite Index closed 0.4% lower at 1578.63, snapping a three-session winning streak amid profit-taking in blue chips ahead of the weekend. Most KLCI constituents ended the day lower, led by IHH Healthcare, down 2.3%, Sime Darby, off 2.2%, and Kuala Lumpur Kepong, 2.1% lower. Dialog Group gained 3.6% and Petronas Chemicals rose 1.9%. The overall market breadth was slightly positive, with 549 gainers versus 532 losers, while 504 stocks were unchanged. (chester.tay@wsj.com)

0905 GMT - UniCredit doesn't rule out M&A and a merger with Banca Monte dei Paschi di Siena will be evaluated, the Italian bank's Chairman-Designate Pier Carlo Padoan told Italian daily La Repubblica in an interview. "We interpret Mr Padoan's words as an opening to M&A, where we see MPS as the most likely option, although we believe that an integration with Banco BPM would make more industrial sense," Intesa Sanpaolo analyst Manuela Meroni says. UniCredit shares rise 2.5%, while Monte dei Paschi is up 5.2%.(pietro.lombardi@dowjones.com; @pietrolombard10)

(END) Dow Jones Newswires

February 05, 2021 05:03 ET (10:03 GMT)

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