FINCOR Weekly Market Perspectives 28/01/2003


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FINCOR Weekly Market Perspectives 28/01/2003

  1. 1. 2013 Weekly Markets28th, n PerspectivesJanuary For important disclosures, refer to the Disclosure Section, located at the end of this report.
  2. 2. Weekly SummaryS&P500 closed above the 1,500 mark for the first Portugal’s first bond sale since its 2011 rescuetime since December 2007. The index climbed for the programme was very well received, attractingfourth straight week, increasing 1.1% over last week. strong demand. Portugal’s earlier than expectedOf the 147 companies in the S&P500 that have return to the market was a positive surprise.already released results, about 76% managed to beat Moreover, the EU Economic and Monetary Affairsconsensus projections, while 67% beat sales Commissioner mentioned that there are severalestimates. The Republicans decided to raise the debt options under consideration to help Portugal (andceiling temporarily (by two months), which has also Ireland) return to markets, including possiblysupported financial markets. extending the maturity of bailout loans or providing a new precautionary credit line.European stocks also posted a weekly gain, reachinga 23-month high. The Stoxx Europe 600 index has now The first FOMC meeting of 2013 will conclude thisadvanced 3.6% in 2013. The euro area economy Wednesday. No major changes are expected. Itseems to be stabilizing, but the steadily increasing will be a busy week for data releases. In the US,Euro will not help the recovery that is expected for the January’s employment report and the ISMsecond half of the year. manufacturing index will be released. In Europe, final PMIs for January are disclosed on Friday, andThe Bank of Japan announced that it will formally on Wednesday we will have the euro area ECadopt a 2% inflation target and introduce an open- confidence indicators. The earnings season willended asset purchase programme starting from also continue. In Portugal, Portucel (on Tuesday)January 2014, after the current purchase programme and BPI (on Wednesday) are expected tohas concluded. announce 2012 results.
  3. 3. Spain: Initial estimate points to a Germany: Ifo Business Climate Survey0.6% q/q contraction in Q4 2012 provides positive news• The Bank of Spain’s initial estimate points to a GDP • The headline index rose from 102.4 to 104.2, quarterly drop of 0.6% in Q4 2012. If confirmed by providing further signs that the economy could the official figure, it would be the weakest outturn fare better in Q1 2013; since Q2 2009; • The headline reflects increased optimism• Q4 2012 would be the fifth consecutive quarterly about future prospects, rather than an contraction; underlying improvement in actual economic• The Government forecast the economy to contract conditions; by 0.5% in 2013; • The sectorial breakdown points to an increase• The EC’s Economic Sentiment Indicator for Spain in the manufacturing and construction have shown signs of stabilization in recent months. components. Nevertheless, the Spanish economy remains weak. Spanish GDP and EC Economic Sentiment Ifo Business Climate Indicator and German GDP 120 6 Indicator 120 7 115 4 5 110 110 2 3 105 100 0 100 1 -2 90 95 -1 -4 EC Economic Sentiment Indicator (LHS) 90 80 -3 Spanish GDP (% y/y, RHS) Ifo Business Climate Indicator (LHS) -6 85 German GDP (% y/y, RHS) 70 -5 80 -8 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 Source: Statistical Office of Spain, European Commission Source: European Commission, Ifo Institute
  4. 4. Euro-zone: Composite PMI rose from Germany: Investors expect the47.3 to 48.2 German economy to improve• January’s flash euro-zone Purchasing Managers’ • The headline index, which measures investors’ Indices provided further evidence that the pace of expectations for the German economy in six contraction in the euro is decelerating. Composite months’ time increased from 6.9 to 31.5, a PMI rose to 48.2, above the consensus forecast of two-and-a-half year high and above its long- 47.4. This was the third consecutive increase and run average; left the index at its highest level since March 2012; • January’s figures point to a rise in sentiment;• The manufacturing index rose from 46.1 to 47.5, • However, the ZEW current conditions index while the services index increased from 47.8 to registered a smaller rise. 48.3. German composite index rose above 50 for the first time since March 2012. However, the French index fell to 44.4. Composite PMI Output and Euro-zone GDP 62 4 ZEW Indicator of Economic Sentiment 59 2 ---------------- Germany ------------------- ----------------- Euro-zone ------------------ 56 53 Economic Expectations Current Situation Economic Expectations Current Situation 0 50 October 2012 -11.5 10.0 -1.4 -79.4 47 -2 November 2012 -15.7 5.4 -2.6 -80.3 44 41 -4 December 2012 6.9 5.7 7.6 -79.9 38 January 2013 31.5 7.1 31.2 -75.3 35 -6 Source: Zew Institute 2005 2006 2007 2008 2009 2010 2011 2012 2013 Composite PMI Output (LHS) Euro-zone GDP (% y/y, RHS) Source: Bloomberg, Eurostat
  5. 5. UK: First estimate suggests that Poland: The economy is still slowing GDP fell by 0.3% q/q in Q4 2012 down• The first estimate of Q4 2012 real GDP delivered a • Nominal retail sales fell by -2.5% y/y in 0.3% q/q decline. A fading Olympics boost and a fall December, after +2.4% y/y in November 2012. in energy output represented important It was the first drop since April 2010; headwinds; • The weakness was broadly based, extending• Manufacturing is still contracting (-1.4% q/q) and to core consumer durables. Car sales were a there was a negative surprise in the decisive large drag; finance sector; • The economy has probably slowed more• Construction showed a small 0.3% q/q gain; sharply at the end of 2012, mainly reflecting a• Four of the last five quarters have registered a weak private consumption. A 25bp rate cut negative q/q real GDP growth rate. seems likely at the February 6th meeting. UK GDP Chained GDP at Market Prices % q/q 40 Poland Retail Sales (% y/y) 0.9 0.7 30 0.6 0.6 0.6 0.4 20 0.1 10 0 -0.2 -0.3 -0.3 -10 -0.4 -0.4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 -20 2010 2010 2010 2010 2011 2011 2011 2011 2012 2012 2012 2012 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 Source: UK Office for National Statistics Source: Polish Statistics Office
  6. 6. South Korea: Real GDP up 1.5% y/y in China: January flash PMI reaches itsQ4 2012 highest level in two years• Real GDP reaccelerated to 1.5% q/q saar in Q4 • China’s flash reading for January Markit 2012 (consensus +2.0%), after having slowed for manufacturing PMI rose for the fifth two consecutive quarters; consecutive month;• In a y/y base, real GDP growth stayed flat at • The index increased from 51.5 in December to 1.5%. In 2012 as a whole, real GDP increased 51.9, the highest reading since January 2011; 2.0% y/y, following a 3.6% gain in 2011; • The new orders component eased to 52.7 in• Private consumption firmed up modestly, while January (from 52.9 in December). Meanwhile, the contribution of net exports declined. the export orders component rose to 50.1 (from 49.1 in December). South Korea GDP (% y/y) 14 12 10 8 6 4 2 0 -2 -4 -6 00 01 02 03 04 05 06 07 08 09 10 11 12 13 Source: Bank of Korea Source: Bloomberg
  7. 7. US: Markit manufacturing flash PMI Portugal: 2012 cash deficit was metrises to 56.1• The US Markit manufacturing flash PMI for • Portugal’s 2012 central government deficit was January rose to 56.1, from December´s final €8.3bn or 4.9% of GDP, lower than the target reading of 54.0; set out by the Troika;• The index has risen in each of the last three • Tax revenues fell 6.8% y/y, reflecting the sharp months and is now at its highest level since drop registered by domestic demand. Primary March 2011; spending decreased 3.6% y/y;• The output, new orders and employment indices • The national accounts budget deficit will be all rose; disclosed next month by the Portuguese• The ISM index and the various regional PMIs have Statistical Office. It is expected to reveal a been more downbeat. higher budget deficit, as losses from public companies, hospitals and PPP will be included. Portugal 2012 Cash Budget - Selected Items (% y/y) Primary Revenues Tax Revenues Indirect Taxes Spending Wage Costs -3.2 -3.6 -4.7 -6.8 -17.9 Source: Bloomberg Source: Ministry of Finance
  8. 8. IMF expects global output to expand Brazil: Copom Minutes were releasedby 3.5% in 2013• Global growth is expected to increase during 2013. • The Copom mentioned that it expects a However, this upturn is projected to be more strengthening of activity during 2013; gradual than in the Oct 2012 WEO projections; • Projected inflation for 2013 and 2014• Growth in the US is forecast to average 2% in 2013, deteriorated since the previous meeting and rising above trend in the second half of the year; remains above the 4.5% target;• The near-term outlook for the euro area has been • The Copom still believe that keeping the Selic at revised downward. Activity is now expected to the current 7.25% will deliver inflation at the contract by 0.2% in 2013; 4.5% target;• Emerging Markets are expected to expand by 5.5%. • Total credit to the economy grew 2.4% m/m in WEO Jan 2013 Update Oct 2012 WEO December (+16.2% y/y). The level of NPLs 2011 2012 2013 2014 2013 2014Global Economy 3.9% 3.2% 3.5% 4.1% 3.6% 4.2% reached 5.8% (7.9% for personal loans).Advance Economies 1.6% 1.3% 1.4% 2.2% 1.6% 2.3% Brazil CPI Index and Selic Target Rate United States 1.8% 2.3% 2.0% 3.0% 2.1% 2.9% 8% 18% Euro-Zone 1.4% -0.4% -0.2% 1.0% 0.1% 1.1% 7% 16% Germany 3.1% 0.9% 0.6% 1.4% 0.9% 1.3% France 1.7% 0.2% 0.3% 0.9% 0.4% 1.1% 6% 14% Italy 0.4% -2.1% -1.0% 0.5% -0.7% 0.5% Spain 0.4% -1.4% -1.5% 0.8% -1.4% 1.0% 5% 12% Japan -0.6% 2.0% 1.2% 0.7% 1.2% 1.1% 4% 10%Emerging and Developing Economies 6.3% 5.1% 5.5% 5.9% 5.6% 5.9% Brazil 2.7% 1.0% 3.5% 4.0% 3.9% 4.2% 3% 8% Russia 4.3% 3.6% 3.7% 3.8% 3.9% 3.9% India 7.9% 4.5% 5.9% 6.4% 6.0% 6.4% 2% 6% China 9.3% 7.8% 8.2% 8.5% 8.2% 8.5% 2006 2007 2008 2009 2010 2011 2012 South Africa 3.5% 2.3% 2.8% 4.1% 3.0% 3.8% CPI IPCA y/y (LHS) SELIC Target Rate (RHS)Source: IMF World Economic Outlook January 2013 Update Source: Bloomberg
  9. 9. Japan: BoJ introduced a 2% price European Banks will repay €137bn oftarget LTRO loans to ECB next week• The BoJ monetary policy meeting on January 21st-22th raised the price target from 1% to 2%; • It is the first opportunity to pay back part of the• The current asset purchase program will change €1tn borrowed a year ago; from the start of 2014 and it will become open- • The ECB announced banks will repay €137bn of ended. A predetermined value of financial assets the LTRO, leaving €882bn outstanding; will be purchased each month (JPY2tn in long- • Large part of the put back is likely to come from term JGBs and JPY10tn in short-term JGBs); banks in core countries. Limited activity is• The Government and the BoJ agreed to expected from peripheral banks; strengthen policy coordination and work • From now on, banks have the option to repay the together to “overcome deflation early”; LTRO on a weekly basis until expiry;• In the BoJ’s Interim Outlook for Economic • With 2 years remaining, LTRO remains an Activity and Prices, the bank lowered its FY2012 attractive facility. Many banks still can’t achieve real GDP growth from 1.5% (its October comparable terms in the funding market. estimate) to 1%. Bank Country Amount that it is Total expected to repay (€bn) LTRO (€bn) BoJ Outlook for Economic Activity and Prices (%) KBC Belgium 8.3 8.9 FY2012 FY2013 FY2014 Belfius (state-owned) Belgium 5.0 25.0 Real GDP Jan-13 1.0 2.3 0.8 Commerzbank Germany 10.0 16.0 Oct-12 1.5 1.6 0.6 Deutsche Pfandbriefbank (state-owned) Germany < 2.0 4.0 Core CPI Jan-13 -0.2 0.4 2.9 (0.9) Bankinter Spain 1.4 9.5 Oct-12 -0.1 0.4 2.8 (0.8) Sabadell Spain 1.5 24.0 Source: BoJ Llodys UK 8.0 - 10.0 13.5 FY2014 core CPI forecast in parenthesis excludes consumption Source: Bloomberg tax hike effect
  10. 10. PSI20 Weekly Review• Sonae Industria (SONI PL) showed the best performance in the index over last week. The stock advanced 23.9% to €0.653. The company is strongly exposed to an euro area economy that seems to be stabilizing. Meanwhile, Sonae Industria has undertaken a restructuring program, but its high leverage remains a concern;• BCP (BCP PL) added more than 14%. The execution of the bank’s operational turnaround is still key to investor sentiment and to be able to redeem the State CoCos. BCP is expected to report FY2012 earnings on February 11th;• Portugal Telecom (PTC PL) was the mais loser. The shares of the Portuguese telecom company fell 6.0%. Oi has replaced its CEO, following the rumours that some shareholders were dissatisfied with the results achieved throughout 2012. Moreover, Oi reported unaudited FY2012 results. Revenues reached BRL27.5bn (vs. consensus BRL28.0bn). EBITDA was BRL8.7bn, a 1% beat vs. consensus of BRL8.6bn;• EDP (EDP PL) was down 2.2% over last week. The Portuguese Treasury State Secretary said in a press interview that the remaining 4.14% stake in the company still owned by the State might by placed in the market. Nevertheless, the Government may still ask for new direct proposals. Source: Bloomberg
  11. 11. Portuguese Sovereign and Corporate Debt Weekly Review Portugal 10-year Government Bond Yield (%) 18• Portugal’s first bond sale since its 2011 rescue programme 17 16 was very well received, attracting strong demand, mostly 15 14 from non-domestic investors. Portugal sold €2.5bn (more 13 12 than the €2bn initially planned) of five-year bonds through 11 10 9 banks, as the country makes progress in regaining access to 8 7 long-term markets. The 4.35% bonds due in October 2017 6 5 were allotted at a yield of 4.891%; Jan-12 Mar- 12 Mai-12 Jul-12 Set-12 Nov-12 Jan-13• This issuance has probably been an important first step for Portugal to see ECB’s OMT programme being activated;• The maturities of Portuguese loans from the EFSF and the the EFSM are likely to be extended at the March Eurogroup meeting, in a move that is expected to reduce its refinancing risk for the coming years;• Moreover, according to the EU Economic and Monetary 1400 BES CDS 5Y 1400 Affairs Commissioner, the combination of an ESM 1200 1200 precautionary programme with the ECB’s OMT programme 1000 1000 could eventually be used to help Portugal return to the 800 800 market; 600 600• Portugal’s 10-year government bond yield fell to the lowest BESPL C DS EUR SR 5Y Corp 400 400 level in more than two years on January 23rd. However, the BESPL C DS EUR SUB 5Y Corp 200 200 rate finished the week one basis point higher at 6.13%. Jan-12 Mar- 12 Mai-12 Jul-12 Set-12 Nov-12 Jan-13 Source: Bloomberg
  12. 12. IBEX35 Weekly Review• Gas Natural (GAS SM) showed the best performance over last week in the IBEX35. The Spanish Government disclosed a draft decree law that incorporates a €157mn charge to be included in the gas access tariffs related to the overcoast paid by the company to Sonatrach over the 2005-2008 period;• Obrascom Huarte Lain (OHL SM) has exercised an equity swap contract representing 5% of the share capital of Abertis. OHL now holds 15% of the motorway group;• Grifols (GRF SM) rose 5.8%. Baxter released Q4 2012 results and confirmed the growth prospects for the plasma industry;• Repsol (REP SM) advanced 3.8%. According to the Spanish press, Repsol will enter Namibia. The company will become the operator of the offshore area;• Telefonica (TEF SM) rose 0.3%. The European Commission fined the company €66.9mn for an illegal non-compete contract clause in the Iberia markets. Moreover, Telefonica is seeking €1.25bn of credit lines to extend debt maturing in 2014;• Bankinter (BKT SM) was the worst performer over last week. The stock went down 4.8%. Credit Agricole (ACA FP) announced the disposal of a 5.2% stake in the Spanish bank through an accelerated book building. Credit Agricole now holds a stake of 9.9% in Bankinter. The French bank agreed to a 180-day lockup period in respect of its remaining holding. Source: Bloomberg
  13. 13. Last week’s European and US equity market highlights• Nokia (NOK1V FH) lost 7.0% over last week. Nokia announced 4.5 Nokia Share Price (€) Q4 2012 results and Q1 2013 outlook in line with its pre- 4.0 announcement. The company said it will omit dividend for the 3.5 3.0 first time in the last 143 years. Despites higher than expected 2.5 Smartphone gross margins, investors remain concerned about 2.0 Nokia’s ability to increase the shipment of Lumia devices; 1.5 1.0• Unilever (UNA NA) advanced 2.7%. Q4 2012 results were well Jan-12 Mar- 12 Mai-12 Jul-12 Set-12 Nov-12 Jan-13 30 Unilever Share Price ahead of consensus on organic revenue growth (7.8% vs. the 29 company-compiled consensus of 6.3%); 28• Novartis (NOVN VX) rose 1.6%. Q4 2012 core EPS was broadly 27 in line with Bloomberg consensus. The company issued 2013- 26 2015 guidance. It was also announced that current chairman 25 Dr. Vasella would not be standing up for re-election and will 24 23 be replaced; Jan-12 Mar-12 Mai-12 Jul-12 Set-12 Nov-12 Jan-13• Apple (AAPL US) fell 11.8%. The company has lost the title of most valued company to Exxon Mobil (XOM US). Apple reported Q1 FY2013 revenues of $54.51bn, below consensus of $54.73bn. EPS of $13.81 was above consensus of $13.44. The company hasn’t been able to deliver what investors have been accustomed to. Moreover, investors seem to have been disappointed by Apple’s guidance. Source: Bloomberg
  14. 14. What we are watching this week:• Key data will be released this week in the US Event (Cont.) Date Hour (GMT) Survey Prior Retail Sales (y/y), Germany 31-Jan 07:00 -1.5% -0.9% (Change in non-farm payrolls, ISM Producer Prices (y/y), France 31-Jan 07:45 2.0% 1.9% Consumer Spending (y/y), France 31-Jan 07:45 0.1% -0.2% Manufacturing). The FOMC meets on Tuesday and Consumer Price Index (y/y), Spain 31-Jan 08:00 3.0% 2.9% Wednesday; Spains Ban on Short Selling Ends Unemployment Rate (s.a), Germany 31-Jan 31-Jan n.a. 08:55 n.a. 6.9% n.a. 6.9%• In Europe, final PMIs for January are released on Unemployment Rate, Brazil 31-Jan 11:00 4.5% 4.9% Consumer Price Index (y/y), Germany 31-Jan 13:00 2.0% 2.1% Friday. The euro-zone money supply data is due Personal Income, US 31-Jan 13:30 0.8% 0.6% Personal Spending, US 31-Jan 13:30 0.3% 0.4% today. On Wednesday, we have the euro area EC PCE Core (y/y), US 31-Jan 13:30 1.4% 1.5% confidence indicators. Initial Jobless Claims, US Gross Domestic Product y/y, Canada 31-Jan 31-Jan 13:30 13:30 350K 1.4% 330K 1.1%Event Date Hour (GMT) Survey PriorConsumer Confidence Ind. sa, Italy 28-Jan 09:00 86 85.7 Chicago Purchasing Manager, US 31-Jan 14:45 50.3 51.6Euro-Zone M3 s.a. 3 mth ave. 28-Jan 09:00 3.8% 3.4% GDP (prel.) Q4 2012 GDP, y/y 31-Jan 00:30 3.0% 1.0%Durable Goods Orders, US 28-Jan 13:30 2.0% 0.7% Ext Trade - Export (YoY), South Korea 1-Fev 00:00 9.4% -5.5%Durables Ex Transportation, US 28-Jan 13:30 0.8% 1.6% Ext Trade - Imports (YoY), South Korea 1-Fev 00:00 0.8% -5.3%Cap Goods Orders Nondef Ex Air, US 28-Jan 13:30 -1.2% 2.7% Manufacturing PMI, China 1-Fev 01:00 51.0 50.6IMF Meets with Spain to discuss Banking Reform 28-Jan n.a. n.a. n.a. HSBC Manufacturing PMI, China 1-Fev 01:45 52.0 51.5GfK Consumer Confidence Survey, Germany 29-Jan 07:00 5.7 5.6 PMI Manufacturing, Spain 1-Fev 08:15 45.5 NAConsumer Confidence Indicator, France 29-Jan 07:45 86 86 PMI Manufacturing, Italy 1-Fev 08:45 47.4 46.72012 GDP, Poland, y/y 29-Jan 09:00 2.2% 4.3% PMI Manufacturing, France 1-Fev 08:50 42.9 42.9RBI Rate Anouncement, India 29-Jan 05:30 n.a. n.a.Consumer Confidence, US 29-Jan 15:00 64.0 65.1 PMI Manufacturing, Germany 1-Fev 08:55 48.8 48.8Industrial Production (y/y), South Korea 29-Jan 23:00 1.2% 2.9% Unemployment Rate (SA), Italy 1-Fev 09:00 11.2% 11.1%ECB LTRO Repayment Begins 30-Jan n.a. n.a. n.a. PMI Manufacturing, Euro-Zone 1-Fev 09:00 47.5 47.5GDP (Constant SA) (y/y), Spain 30-Jan 08:00 -1.7% -1.6% PMI Manufacturing, UK 1-Fev 09:30 51.0 51.4Economic Sentiment, Italy 30-Jan 09:00 n.a. 75.4 Euro-Zone CPI Estimate (y/y) 1-Fev 10:00 2.20% 2.20%Business Confidence, Italy 30-Jan 09:00 89.5 88.9 Euro-Zone Unemployment Rate 1-Fev 10:00 11.90% 11.80%Euro-Zone Economic Confidence 30-Jan 10:00 88.2 87.0 Industrial Production nsa (y/y), Brazil 1-Fev 11:00 -4.70% -1.00%Business Climate Indicator, Euro-Zone 30-Jan 10:00 -1.00 -1.12 PMI Manufacturing, Brazil 1-Fev 12:00 n.a. 51.1Euro-Zone Indust. Confidence 30-Jan 10:00 -13.5 -14.4 Change in Nonfarm Payrolls, US 1-Fev 13:30 155K 155KEuro-Zone Consumer Confidence 30-Jan 10:00 -23.9 -23.9 Unemployment Rate, US 1-Fev 13:30 7.8% 7.8%Euro-zone Services Confidence 30-Jan 10:00 -9.0 -9.8ADP Employment Change, US 30-Jan 13:15 165K 215K Markit US PMI Final, US 1-Fev 13:58 n.a. n.a.GDP q/q (Annualized), US 30-Jan 13:30 1.2% 3.1% U. of Michigan Confidence, US 1-Fev 14:55 71.4 71.3Personal Consumption, US 30-Jan 13:30 2.1% 1.6% Construction Spending m/m, US 1-Fev 15:00 0.7% -0.3%FOMC Rate Decision, US 30-Jan 19:15 0.25% 0.25% ISM Manufacturing, US 1-Fev 15:00 50.5 50.7Industrial Production y/y, Japan 30-Jan 23:50 -5.6% -5.5% Source: Bloomberg
  15. 15. Next Week Preview: Economics• The euro area inflation estimate is due Friday and is likely to Change in Non-Farm Payrolls (000s) remain flat at 2.2% y/y. In the UK, PMI manufacturing will be Jan Fev Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2010 -40 -35 189 239 516 -167 -58 -51 -27 220 121 120 released on Friday and it is expected to fall to 51.0 from 51.4 2011 110 220 246 251 54 84 96 85 202 112 157 223 in December; 2012 275 259 143 68 87 45 181 192 132 137 161 155• In Colombia, the central bank is likely to cut its policy rate by US Conf. Board Consumer Confidence an additional 25bp to 4.00% in response to continued weak 74 activity indicators; 72• In the US, durable goods orders will be released today (13:30 70 GMT) and should be supported by aircraft orders. 68 66 Nonetheless, excluding transportation, core orders probably 64 increased at a more modest pace; 62• The Conference Board should disclose its measure of US 60 consumer confidence on Tuesday (15:00 GMT). It is likely to Jan-12 Fev-12 Mar-12 Abr-12 Mai-12 Jun-12 Jul-12 Ago-12 Set-12 Out-12 Nov-12 Dez-12 65 US ISM Manufacturing Index have slipped from 65.1 to 64.0 in January, reflecting the drag 60 on sentiment caused by the payroll tax cut;• US Q4 2012 real GDP (1st estimate) will be disclosed on 55 Wednesday (13:30 GMT). Real GDP probably slowed quite 50 sharply to 1.2%, from 3.1% in Q3 2012. In the third-quarter, 45 GDP growth was driven by a surge in government expenditure; 40• The employment report and the ISM Manufacturing index will 35 both be released on Friday at 15:00GMT. Payroll employment 30 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 is expected to show a steady increase (155,000). Source: Bloomberg
  16. 16. Next Week Preview: FOMC meeting and Portuguese EarningsSeasonFOMC will hold its first meeting of 2013 Portucel and BPI to report earnings• The first FOMC meeting of 2013 is unlikely to • Portucel (PTI PL) is expected to released Q4 2012 bring any major changes; results on January 29th;• The majority of Fed officials will probably be • The paper division is expected to benefit from satisfied with the market response to their QE stable UWF paper prices (-1% y/y) with lower policy announcements. However, the minutes discounts. The pulp unit is likely to reflect the rising from the last FOMC meeting revealed that trend of BEKP prices (+7% y/y). EBITDA margins "several… (members) thought that it would should benefit from lower wood costs; probably be appropriate to slow or to stop • Investors’ focus will probably be at the company’s purchases well before the end of 2013“; expectations regarding demand evolution in the• The annual voting rotation of the regional Fed UWF paper industry. Consensus expects Q4 2012 Presidents is not expected to sift the balance of Revenues, EBITDA and Net Profit of €381mn, power significantly. €103mn and €52mn respectively; FEDs Asset Holdings ($bn) 3,000 • BPI (BPI PL) is due to report 2012 results on January 2,500 30th. Top line is expected to remain sluggish, 2,000 reflecting NIM pressures. Impairments should be 1,500 down both y/y and q/q. Stable nominal costs are 1,000 500 expected. International operations should remain 0 solid; 03 04 05 06 07 08 09 10 11 12 Source: Federal Reserve • Consensus expects Q4 2012 Net Profit of €28.9mn.
  17. 17. Next Week Preview: European Earnings SeasonCompany Name thMonday, 28 JanuaryColruyt Company Ticker Time (GMT) COLR BB 16:45 Event Description Q3 2013 Sales and Revenue Release Many Blue Chips are expected toRyanair Holdings RYA ID Q3 2013 Earnings Release thTuesday, 29 JanuaryPhilips Electronics PHIA NA 06:00 Y 2012 Earnings Release report earnings this weekSoftware SOW GR 06:00 Y 2012 Earnings ReleaseSandvikBritish LandWilliam Hill SAND SS BLND LN WMH LN 07:00 07:00 08:30 Y 2012 Earnings Release Q3 2013 Sales and Revenue Release - Interim Management Statement Q4 2012 Sales and Revenue Call - Trading Update • Philips (PHIA NA) is due to report Q4 2012British LandNational Grid BLND LN NG/ LN 09:00 14:00 Q3 2013 Sales and Revenue Call - Interim Management Statement Q3 2013 Sales and Revenue Call - Interim Management Statement results on January 29th. The company has aLuxottica Group LUX IM Q4 2012 Sales and Revenue Release thWednesday, 30 January low correlation with the general industrialRoche ROG VX 06:00 Y 2012 Earnings ReleaseNordeaAntofagasta NDA SS ANTO LN 06:00 07:00 Y 2012 Earnings Release Q4 2012 Sales and Revenue Release - Production Results cycle and Q4 is usually its biggest quarterScaniaSKF SCVB SS SKFB SS 08:30 12:00 Y 2012 Earnings Release Y 2012 Earnings Release of the year. Investors will focus on theUnibail-Rodamco UL FP Aft-mkt Y 2012 Earnings ReleaseSTMicroelectronicsHennes & Mauritz STM IM HMB SS Aft-mkt Y 2012 Earnings Release Y 2012 Earnings Release group’s cost cutting momentum;Fiat F IM Y 2012 Earnings ReleaseImperial TobaccoUnited Utilities IMT LN UU/ LN Q1 2013 Sales and Revenue Release - Interim Management Statement Q3 2013 Sales and Revenue Release - Interim Management Statement • Roche (ROG VX) will report H2 2012 resultsTeliaSonera AB thThursday, 31 January TLSN SS 06:00 Y 2012 Earnings Release on January 30th. Consensus expectsSkandinaviska Enskilda BankenEricsson SEBA SS ERICB SS 06:00 06:30 Y 2012 Earnings Release Y 2012 Earnings Release revenues of CHF22.897bn and diluted coreInfineon Technologies IFX GR 06:30 Q1 2013 Earnings ReleaseRoyal Dutch ShellDiageo RDSA LN DGE LN 07:00 07:00 Y 2012 Earnings Release S1 2013 Earnings Release EPS of CHF6.91. in Q3 2012, Roche showedVedanta Resources VED LN 07:00 Q3 2013 Sales and Revenue Release - Production ResultsFortumAstraZeneca FUM1V FH AZN LN 07:00 07:00 Y 2012 Earnings Release Y 2012 Earnings Release a 1.4% revenue beat vs. consensus, withBritish Sky BroadcastingUPM-Kymmene BSY LN UPM1V FH 07:00 07:30 S1 2013 Earnings Release Y 2012 Earnings Release key products beating consensus by 4%-7%;Novo Nordisk NOVOB DC Bef-mkt Y 2012 Earnings ReleaseBanco SantanderDeutsche Bank SAN SM DBK GR Bef-mkt Bef-mkt Y 2012 Earnings Release Y 2012 Earnings Release • Royal Dutch Shell (RDSA NA) reports its Q4Atlas CopcoLVMH ATCOA SS MC FP 11:00 Aft-mkt Y 2012 Earnings Release Y 2012 Earnings Release 2012 results on January 31th. Brent pricesFiat Industrial FI IM Y 2012 Earnings ReleaseLonmin PLCSSE LMI LN SSE LN Q1 2013 Sales and Revenue Release - Production Report Q3 2013 Sales and Revenue Release - Interim Management Statement were stable but US gas prices showed a stFriday, 1 FebruaryElectrolux ELUXB SS 07:00 Y 2012 Earnings Release robust increase. However, refining marginsOMV OMV AV 07:00 Q4 2012 Sales and Revenue Release - Trading StatementBanco Bilbao Vizcaya ArgentariaBanco Popular Espanol BBVA SM POP SM Bef-mkt Bef-mkt Y 2012 Earnings Release Y 2012 Earnings Release came off during the quarter;CaixaBankBT Group CABK SM BT/A LN Y 2012 Earnings Release Q3 2013 Earnings Release • LVMH (LVMH FP) will report FY2012 resultsEnel Green Power EGPW IM Q4 12 Sales and Revenue Release - Preliminary ResultsTate & LyleSource: Bloomberg TATE LN Q3 2013 Sales and Revenue Release - Interim Management Statement after market close on January 31th.
  18. 18. Next Week Preview: US Earnings SeasonCompany Name thMonday, 28 January Company Ticker Time (GMT) Estimate Event Description Healthcare will probably be theBiogen BIIB US Bef-mkt 1.459 Q4 2012 Earnings ReleaseCaterpillarSeagate TechnologyYahoo! CAT US STX US YHOO US 12:30 Aft-mkt Aft-mkt 1.703 1.278 0.279 Q4 2012 Earnings Release Q2 2013 Earnings Release Q4 2012 Earnings Release highlight with Lilly, Pfizer andAmerican Electric Power thTuesday, 29 January AEP US 0.456 Q4 2012 Earnings Release Merck reporting this weekValero Energy VLO US Bef-mkt 1.19 Q4 2012 Earnings ReleasePfizerDR Horton PFE US DHI US Bef-mkt Bef-mkt 0.442 0.141 Q4 2012 Earnings Release Q1 2013 Earnings Release • Pfizer (PFE US) will release earnings onCorningTyco International GLW US TYC US Bef-mkt Bef-mkt 0.324 0.394 Q4 2012 Earnings Release Q1 2013 Earnings Release January 29th. The focus will probably be onHarley-Davidson IncInternational Paper HOG US IP US Bef-mkt Bef-mkt 0.314 0.65 Q4 2012 Earnings Release Q4 2012 Earnings Release 2013 guidance and on management’sDanaher DHR US 11:00 0.856 Q4 2012 Earnings ReleaseFord Motor Co F US 12:00 0.256 Q4 2012 Earnings Release comments for launch expectations forIllinois Tool Works Inc ITW US 13:00 0.899 Q4 2012 Earnings ReleaseRobert Half International IncBroadcom RHI US BRCM US 21:00 Aft-mkt 0.408 0.735 Q4 2012 Earnings Release Q4 2012 Earnings Release Xeljanz and Eliquis;Amazon.comBoston Scientific AMZN US BSX US Aft-mkt 0.265 0.11 Q4 2012 Earnings Release Q4 2012 Earnings Release • Ford Motor (F US) will report Q4 2012United States SteelEli Lilly & Co X US LLY US -0.768 0.788 Q4 2012 Earnings Release Q4 2012 Earnings Release earnings on January 29th. Earnings are likely thWednesday, 30 JanuaryNorthrop Grumman NOC US Bef-mkt 1.736 Q4 2012 Earnings Release to be driven by strong operating incomeBoeing BA US 12:30 1.186 Q4 2012 Earnings ReleaseSouthern Co SO US 12:30 0.39 Q4 2012 Earnings Release from North America. The company hasQUALCOMM QCOM US 21:00 1.125 Q1 2013 Earnings ReleaseConocoPhillipsJDS Uniphase COP US JDSU US Aft-mkt Aft-mkt 1.414 0.139 Q4 2012 Earnings Release Q2 2013 Earnings Release guided towards strong losses in Europe. thThursday, 31 JanuaryPulteGroup PHM US Bef-mkt 0.308 Q4 2012 Earnings Release The company will also provide generalColgate-PalmoliveTime Warner Cable CL US TWC US Bef-mkt Bef-mkt 1.395 1.551 Q4 2012 Earnings Release Q4 2012 Earnings Release 2013 outlook;Dow ChemicalWhirlpool DOW US WHR US Bef-mkt 11:00 0.341 2.248 Q4 2012 Earnings Release Q4 2012 Earnings Release • Dow Chemical (DOW US) will report Q4Altria Group MO US 12:00 0.545 Q4 2012 Earnings ReleaseUnited Parcel Service UPS US 12:45 1.376 Q4 2012 Earnings Release 2012 results on January 31th, which willViacom VIAB US 0.911 Q1 2013 Earnings ReleaseDominion Resources stFriday, 1 February D US 0.694 Q4 2012 Earnings Release probably reflect a positive evolution onExxon MobilMerck XOM US MRK US Bef-mkt Bef-mkt 2.004 0.81 Q4 2012 Earnings Release Q4 2012 Earnings Release integrated margins for polyethylene and anMattelChevron MAT US CVX US 11:00 13:30 1.148 3.028 Q4 2012 Earnings Release Q4 2012 Earnings Release improvement in the Performance PlasticsFord Motor F US 14:30 January 2013 Sales and Revenue ReleaseSource: Bloomberg segment.
  19. 19. Next Week Preview: Government Debt Issuance Calendar andIdea of the week Italy will probably be the highlight Idea of the week: Repsol (REP SM) of the week • Investors expect an announcement on the sale of the• Over the week, Italy is expected to auction LNG business. If the deal goes ahead, it will probaby T-Bills and bonds; be enough for Repsol to maintain its investment• Italy and Spain will have bond redemptions grade credit rating; this week; • The company is expected to present sector leading• Germany will issue ultralong bonds (July organic production growth with the start-up of key 2044). fields in Peru and Brazil;Next weeks Selected Bonds and T-Bills Supply • As volumes growth, earnings are likely to improve;Issue Country Date Amount (€bn) Hour (GMT)Dec 2014 Italy 28-Jan 4.0 10:00 • Repsol has underperformed the sector following theSep 2018 Italy 28-Jan 2.5 10:003M France 28-Jan 4.0 13:50 expropriation of YPF. But, the company has an6M France 28-Jan 2.0 13:50 interesting portfolio of projects.12M France 28-Jan 1.5 13:5012M Germany 28-Jan 3.06M Italy 29-Jan 8.5 10:00Jul 2044 Germany 30-Jan 2.0 10:30Nov 2017 Italy 30-Jan 3.0 16:00Nov 2022 Italy 30-Jan 3.5 16:00Next weeks Selected Bonds and T-Bills redemptionsIssues Country Date Amount (€bn) Hour (GMT)Bonds Spain 31-Jan 14.3T-Bills France 31-Jan 7.8T-Bills Italy 31-Jan 9.8T-Bills Netherlands 31-Jan 4.8Bonds Italy 01-Fev 21.0Source: Treasuries; Fincor Source: Company Information
  20. 20. Charts we are watching 12• Following some Brazilian press reports that Oi’s OI (OIBR4 BZ) Share Price (BRL) shareholders were dissatisfied with CEO Francisco Valim’s 11 handling of the company, the Brazilian Telecom operator announced its replacement by Jose Mauro da Cunha, its 10 current Chairman. In an attempt to ease market concerns, 9 Oi released in line selected preliminary unaudited figures for 2012. Moreover, the company disclosed a BRL1bn 8 dividend, equivalent to a 7% yield. According to the 7 Brazilian press, Portugal Telecom (PTC PL) could be in talks to buy the stakes in Oi owned by the Jereissati and 6 Andrade families for $985mn. This is an additional 2011 Source: Bloomberg 2012 2013 evidence that the Portuguese company considers the 8,500 PSI 20 Portuguese Stock Index Brazilian market to be key. 8,000 7,500• Stocks in peripheral Europe have posted the biggest gains 7,000 among developed markets in 2013 ytd. Portugal’s 6,500 benchmark PSI 20 rose 8.5% and Spain’s IBEX 35 increased 6,000 5.3%. Germany’s Dax has only advanced 1.4%. With tail 5,500 risks having been removed by the ECB and peripheral 5,000 countries moving progressively to a current account 4,500 surplus, the improvement in investor sentiment could 4,000 2011 2012 2013 continue to support these stock markets. Source: Bloomberg
  21. 21. Disclosure SectionThis research report is based on information obtained from sources which we believe to be credible and reliable, but isnot guaranteed as to accuracy or completeness. All the information contained herein is based upon informationavailable to the public.The recipient of this report must make its own independent assessment and decisions regarding any securities orfinancial instruments mentioned herein.This report is not, and should not be construed as an offer or a solicitation to buy or sell any securities or relatedfinancial instruments. The investment discussed or recommended in this report may be unsuitable for investorsdepending on their specific investment objectives and financial position.The material in this research report is general information intended for recipients who understand the risks associatedwith investment. It does not take account of whether an investment, course of action, or associated risks are suitablefor the recipient.Investors should seek financial advice regarding the appropriateness of investing in any securities or investmentstrategies discussed or recommended in this research report and should understand that the statements regardingfuture prospects may not be realized. Investors may receive back less than initially invested. Past performance is not aguarantee for future performance.Fincor – Sociedade Corretora, S.A. accepts no liability of any type for any indirect or direct loss arising from the use ofthis research report.Recommendations and opinions expressed are our current opinions as of the date referred on this research report.Current recommendations or opinions are subject to change as they depend on the evolution of the company or maybecome outdated as a consequence of changes in the environment.Fincor - Sociedade Corretora, S.A. provides services of reception, execution, and transmission of orders.
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