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Europe higher today, with almost all of 2018's losses gained back; Asia mixed overnight

Mar 19, 2019

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scroll down for the Asian markets recap

International Stock Markets Indexes

*Data in Price Return and Updated Real-Time (with a delay), Source: StockDio

European Markets Recap

  • European stocks rally today and have now gained back almost all of the losses suffered during the selloff of late 2018
  • After another “no vote” on her BREXIT Plan in the UK Parliament, UK Prime Minister Theresa May is looking for another extension to the deadline for the UK exit of the European Union (EU). 
  • We are highlighting our Top Stock Ideas in Brazil today, click here: Score a goal with these top stocks in Brazil you MUST check out
  • The Euro Stoxx 600 is currently up +0.61%, the FTSE 100 is higher by +0.45%, the DAX has risen +1.13%, and the CAC 40 is up +0.27%
  • Automobiles & Parts (+2.38%), Basic Resources (+1.64%), and Retail (+1.34%) stocks are the top performers in the Euro Stoxx 600 today
  • Construction & Materials (-0.02%), Insurance (-0.01%), and Oil & Gas (+0.06%) stocks are the worst performers in the Euro Stoxx 600 today
  • Investor sentiment for European stocks is positive with the advance/decline ratio for the Euro Stoxx 600 currently at 2.95x
  • 161 stocks in the Euro Stoxx 600 are at 4-week highs while 12 stocks are at 4-week lows
  • 104 stocks in the Euro Stoxx 600 are overbought while 4 stocks are oversold according to the 16-day RSI Measure

Asian Stock Markets Indexes

Asian Markets Recap

  • The Nikkei 225 finished down --0.08%, the Hang Seng ended up +0.19%, the Hang Seng China Enterprise up +0.1%, and the CSI 300 was -0.46%
  • Investor sentiment for Japanese stocks finished negative with the advance/decline ratio for the Nikkei 225 closing at 0.92x
  • 27 stocks in the Nikkei 225 hit 4-week highs while 14 stocks reached 4-week lows
  • 11 stocks in the Nikkei 225 closed overbought while 2 stocks closed oversold according to the 16-day RSI Measure
  • Investor sentiment for Hong Kong stocks finished positive with the advance/decline ratio for the Hang Seng closing at 2.13x
  • 18 stocks in the Hang Seng hit 4-week highs while 1 stock reached 4-week lows
  • 6 stocks in the Hang Seng closed overbought while 0 stocks closed oversold according to the 16-day RSI Measure

Stocks Trending in the News

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Global Consumer Stocks Trending in the News

  • Asos Plc (AIM: ASC) shares fell the most intraday in 2019 after the company issued a profit warning for its full-year. Asos reported FY2Q2019 sales growth that largely missed its prior guidance, driving Asos to pull-back its full-year profit target. A profit warning from the UK-based online retailers shows that the UK retail crisis is not contained within domestic brick-and-mortar stores. Asos is rated “Neutral” in our United Kingdom All-Cap Global Top Stock Ideas.
  • Coty (COTY) could be completely acquired by JAB Holdings Ltd. (AIM:JBH) in the wake of its offer for about 60% of the outstanding shares of the company, according to Consumers Edge Research.  In a note Consumers Edge comments that it believes that JAB will eventually offer to acquire the rest of the shares.  A special committee of the board of Coty recommended shareholders accept the offer from JAB.  Coty is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Staples Global Top Stock Ideas.  JAB is not rated in our Global Top Stock Ideas.
  • DSW (DSW) reported fourth quarter adjusted loss per share of 7 cents missing consensus of 3.2 cents per share earnings.  DSW saw same store sales growth of +5.4%, above 5% consensus.  DSW announced a 3-year plan for growth that is will detail on investors day.  DSQ will also provide forward guidance at that time.  DSW is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • GrubHub (GRUB) shares slipped after KeyBanc Capital Markets wrote in a note to clients that internal data points are indicating weakening trends in the company’s user base. KeyBanc analyst Andy Hargreaves wrote in the note, “Diner retention, initial diner spend, and peak diner spend all appear to be deteriorating, which suggests lifetime value in newer cohorts is declining.” GrubHub is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Kraft-Heinz (KHC) announced it has not met the deadline for filing its 10-K with the US SEC.  It is likely the delay is being caused by the SEC investigation recently announced into Kraft-Heinz’s procurement practices.  Kraft did not say how long until it expects to make the filing.  S&P placed Kraft-Heinz on credit watch because of the delay since it needs the 10-K to stay current with its credit rating.  Kraft-Heinz is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Staples Global Top Stock Ideas.
  • Overstock.com (OSTK) provided first quarter guidance, saying revenues will fall 17-19% “as a result of our return to a disciplined approach to marketing.”  Overstock fourth quarter revenue of USD$452.5 million trailed the USD$483.5 million consensus with a loss per share of USD$1.39.  Overstock’s CEO said there will be further administrative cost reductions in 2019 and the company expects to return to profitability this calendar year.  Overstock.com is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Short” in our US Consumer Staples Global Top Stock Ideas.
  • Revlon (REV) shares are suffering after telling the market that is delayed 10-K filing may reveal “a material weakness” in its financial controls.  Revlon said it is having a problem with its enterprise planning software and it will cost USD$54 million to fix the problems.  Revlon said the delayed 10-K will not cause any change in its reported results.  Revlon is rated “Top Buy” in our US SMID-Cap Global Top Stock Ideas and “Top Short” in our US Consumer Staples Global Top Stock Ideas.
  • Zozo Inc. (TSE: 3092) shares dipped after JPMorgan pulled-back its earnings estimates, citing downsides to the company’s new Arigato service appeared to be aimed at securing subscription revenue. JPMorgan lowered its profit estimates for Zozo by 12% and 25% in FY2018 and FY2019, respectively. JPMorgan also slashed Zozo’s price target from 2,700 yen/share to 2,300 yen/share. Zozo is not rated in our Global Top Stock Ideas.

Global Information Technology & Communication Services Stocks Trending in the News

  • Advanced Micro Drives (AMD) shares rallied after Alphabet’s (GOOG.L) Google announced a new gaming initiative, which will present a significant opportunity for the chip company. Morgan Stanley wrote on the news, “This seems like a material positive in a market where AMD has largely abdicated its position in gaming oriented graphics.” AMD is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas. Alphabet is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.
  • Apple (AAPL) debuted a new mid-tier model of its iPad and an update to the iPad mini.  The new iPad model is called the iPad Air and features an 10.5-inch screen; this model was phased out a few years ago when the iPad Pro was introduced.  The iPad min saw the first update since 2015.  The announcements come a week before Apple is expected to introduce a media and entertainment bundle with TV and streaming, including Apple produced content.  Apple is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas.
  • China Telecom (SEHK:728) reported full year net income that beat consensus.  Full year net income of 21.2 billion yuan beat the 20.44 billion yuan consensus.  China Telecom full year dividend per share is 12.5 Hong Kong cents per share.  China Telecom said 80% of its customers are using 4G at the end of the quarter.  China Telecom is focused on 5G rollout.  China Telecom is rated “Top Buy” in our China All-Cap Global Top Stock Ideas.
  • StoneCo Ltd. (STNE) shares soared after the company reported earnings that crushed consensus. StoneCo generated net income of USD$127.1mm in CY4Q2018 while analysts expected a loss of USD$25.4mm. StoneCo’s revenue of USD$529.4mm surpassed consensus of USD$465.6mm by more than 13%. StoneCo is not rated in our Global Top Stock Ideas.
  • Tencent Holdings Ltd. (SEHK: 700) is targeting layoffs of about 10% of its existing managers in an effort to clear space for younger executives, according to people familiar with the matter. According to reports, President Martin Lau told employees at an internal meeting last year that the company’s lowest-performing general managers should prepare to leave the company or be demoted. The news comes after China froze gaming approvals for 9 months in 2018. Tencent is rated “Neutral” in our China All-Cap Global Top Stock Ideas.
  • Twitter (TWTR) is the subject of a USD$250 million from Congressman Devin Nunes charging defamation.  Twitter was orchestrating an effort to harm Nunes, according to his suit.  It alleges Twitter “intended to generate and proliferate false and defamatory statements” about Nunes in an effort to intimidate him.  The content in question violated Twitter’s the platform’s user guidelines, it is alleged.  Twitter is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • Xiaomi (SEHK:1810) reported fourth quarter operating profit of 3.2 billion yuan, handily beating consensus of 1.6 billion yuan.  Xiaomi saw the average selling price of its phones at 1,005 yuan in 2018, up from 824 yuan in 2017.  Internet services revenue grew 39% y/y and accounted for 9.1% of Xiaomi’s revenue.  Xiaomi is rated “Neutral” in our China All-Cap Global Top Stock Ideas.

Global Financials Stocks Trending in the News

  • Danske Bank A/S (CPSE: DANSKE) Chairman Karsten Dybvad highlighted other banks’ ties to the Estonia money laundering scandal in an interview Tuesday. “But we can see in other banks that there are indications that others are involved,” said Dybvad, adding, “So we’ll have to see.” Dybvad also discussed that he fears that the USD$230bn money laundering scandal will end up even bigger as more information is uncovered. Danske Bank is rated “Top Short” in our European Large-Cap Global Top Stock Ideas.

Global Industrial Stocks Trending in the News

  • Union Pacific (UNP) was downgraded to hold from buy at Lop Capital today.  Union Pacific’s price target was cut to USD$182 from USD$193.  Loop commented that the dual problems of the ice cold polar vortex and extensive flooding in the Midwest will weigh on near term results.  Union Pacific is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Industrials Global Top Stock Ideas.

Global Commodities & Power Stocks Trending in the News

  • Antofagasta (LSE:ANTO) declared another large dividend in the wake of record production.  Antofagasta declared a 37 cents per share dividend which brings the total annual dividend to 43.5 cents per share.  That represents a 60.5% payout, well above the minimum 35% payout that is the company’s policy.  Record production and tight copper markets are benefitting Antofagasta.  Antofagasta is rated "Top Short” in our United Kingdom Global Top Stock Ideas.
  • Norsk Hydro (OB:NHY) is suffering production outages in the US and Europe in the wake of a cyber attack on its systems.   Norsk Hydro has moved production processes to manual mode where possible and where it is not, production has come to a halt.  Norsk is not ready to give a timeline for a return to normal as it is still accessing the problem.  Norsk Hydro is rated “Unattractive” in our European SMID-Cap Global Top Stock Ideas.
  • Rio Tinto (LSE:RIO) must face a lawsuit from the US SEC regarding the company’s valuation of its coal assets in Mozambique, according to a ruling from a federal judge.  In 2017 the SEC filed suit alleging the coal assets’ value were inflated by Rio Tinto when acquired in 2017.  Rio Tinto had sought to dismiss the case from the SEC but the judge ruled it can proceed.  Rio Tinto is rated “Neutral” in our United Kingdom Global Top Stock Ideas. 

Global Health Care Stocks Trending in the News

  • Tilray Inc. (TLRY) shares rose before slipping into the red after the company's sales beat was tempered by concerns over the company's valuation. Jefferies analyst Owen Bennett wrote to clients, “This stock remains one of the most expensive in the space by far and yet its revenue trails significantly below closest peers.” Tilray told investors that it expects revenue to at least triple in FY2019 from the prior year’s USD$43mm. Tilray is not rated in our Global Top Stock Ideas.

Global Real Estate Stocks Trending in the News

  • Jones Lang LaSalle (JLL) will acquire all outstanding shares of HFF Inc. (HF) in a cash-stock transaction that values the former’s equity at roughly USD$2bn. HFF shareholders will receive USD$24.63/share of cash and .1505 shares of Jones Lang LaSelle for each HFF share owned. Jones Lang LaSalle expects the acquisition to close in CY3Q2019. Jones Lang LaSalle is rated “Neutral” in our US Large-Cap Global Top Stock Ideas. HFF is rated “Neutral” in our US SMID-Cap Global Top Stock Ideas.

 

 

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