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Mint
30-07-2025
- Business
- Mint
Turnaround Hopes Lift SocGen to 2011 Highs Ahead of 2Q Report
(Bloomberg) -- Societe Generale SA shares hit their highest intra-day levels since 2011, a day ahead of the publication of the French banking group's second-quarter results as hopes about Chief Executive Officer Slawomir Krupa's turnaround plan gained further traction. SocGen shares have had a stellar start to the year, rising 92% as investors see the bank boosting its profitability and shareholder payouts after successfully strengthening its balance sheet. 'Regulatory constraints on capital are set to ease on SocGen and investors are therefore speculating that the bank could announce buybacks tomorrow,' said Gilles Guibout, head of European equities at AXA IM. The group, headquartered in the business district of La Defense in Paris, has been busy disposing of non-core assets and cutting costs. Its price-to-book value, which still prices at about half the average level of its European peers, doubled to 0.6 from 0.3 at the beginning of the year. 'It's one of the few banks trading below book value in Europe so there's hopes its valuation could catch up further,' Guibout added. The European banking sector currently trades at 1.1 book value. Banks overall in Europe are having a superb run, with the Stoxx 600 Banks Index up 38% since the start of the year, the best performing sector in the region. Investors are piling into banks amid resilient earnings and attractive shareholders returns. For now, the strong run at SocGen vindicates the CEO's strategy revamp, which had initially sent the stock down 12% when it was unveiled in September 2023. At 12:39 in Paris, the stock was up 1.2% at €52.3, set to close at high unseen since September 2009. High expectations may however weigh on the shares on Thursday. 'The bar is set quite high for these results,' said Antonio Roman, Portfolio Manager at Axiom Alternative Investments. 'There's some expectations that they might be able to increase their return on equity targets and there will be pressure for them to beat expectations on cost cutting and most business lines, particularly in French retail,' he added. --With assistance from Claudia Cohen.
Mint
09-07-2025
- Business
- Mint
European Stocks Gain as UniCredit Rally Lifts Banks; WPP Sinks
European stocks rose for a third day, with banks leading gains on the back of a rally in UniCredit SpA, while advertising group WPP Plc sank 15% after it tempered its revenue outlook. The Stoxx Europe 600 Index gained 0.8% at 12:28 p.m. in London. UniCredit SpA advanced 3.5% after it doubled its equity stake in German rival Commerzbank AG to about 20%, fueling renewed speculation around potential banking deals in Europe. The Stoxx 600 Banks Index rose 1.8%. Miners dropped after President Donald Trump indicated the US would implement a higher-than-expected 50% tariff on copper imports. Health care stocks also underperformed as Trump threatened levies of as much as 200%. WPP shares slumped after the firm lowered its full-year outlook as it struggles with weaker-than-expected client spending and new business. EssilorLuxottica SA rose 5.7% as Bloomberg News reported that Meta Platforms Inc. bought a minority stake in the world's largest eye-wear maker. European stocks have meandered this month as lingering trade uncertainty kept a lid on risk demand. The benchmark Stoxx 600 is still about 3% below its March record high, and has trimmed most of this year's outperformance versus US stocks in local currency terms. The European Union is reportedly nearing a trade deal with the US, with negotiators focusing on protecting key industries from massive tariffs set to hit the bloc's exports as soon as Aug. 1. Trump stressed he would not offer additional extensions on country-specific levies. 'Investors are optimistic about a deal in Europe and are front-running it with gains,' said Georges Debbas, head of European equity derivatives strategy at BNP Paribas Markets 360. 'On top of that, positioning remains low and European stocks have underperformed the US recently so the market does have the scope to gain further in the short term.' Focus next week will turn to the second-quarter earnings season as investors look for clues on the impact of higher tariffs. Goldman Sachs Group Inc. strategists said they remain tactically neutral on equities. The team including Christian Mueller-Glissmann expects to see a worsening growth and inflation mix in the second half of the year, saying that 'elevated risk appetite increases risk of disappointments.' In other movers, Semco Technologies SAS surged 45% in its Paris trading debut on Wednesday. For more on equity markets: You want more news on this market? Click here for a curated First Word channel of actionable news from Bloomberg and select sources. It can be customized to your preferences by clicking into Actions on the toolbar or hitting the HELP key for assistance. To subscribe to a daily list of European analyst rating changes, click here. With assistance from Paul Jarvis. This article was generated from an automated news agency feed without modifications to text.
Bloomberg
01-07-2025
- Business
- Bloomberg
Bank Stocks Are Roaring as Growth Outlook Brightens
Bank stocks are on a tear on both sides of the Atlantic: In Europe, the Stoxx 600 Banks Index rose 29% in the six months through yesterday, its strongest first half since 1997, while a gauge of financial stocks in the S&P 500 is at a record. One common theme is lower interest rates. Investors expect the Federal Reserve to cut rates in the US further this year, which could spur lending, while the European Central Bank has been easing to support the fragile economy. (While typically higher rates are favorable for banks, cuts this year are welcome given concerns about a growth slowdown.)
Mint
01-07-2025
- Business
- Mint
European Banks' First-Half Stock Gains Are Biggest This Century
European bank stocks just completed their strongest first-half since 1997, and in doing so extended what has been a golden run for the sector. The Stoxx 600 Banks Index rose 29% in the six months through June 30, the top-performing subgroup in Europe, as investors piled into lenders for their strong returns and resilient earnings. An increase in deal-making added more fuel to the fire, particularly in Italy. Among the main highlights of a stellar first half, Banco Santander SA's advance pushed it past UBS Group AG to become continental Europe's most valuable lender, while Commerzbank AG's value appreciated so much that UniCredit SpA doesn't see it as an attractive deal target. Looking ahead, some analysts are bullish about the sector's ability to ride the crest of a wave despite macroneconomic uncertainty and trade-related risks. KBW's Andrew Stimpson says the prospect of continued outperformance is founded on a much improved earnings profile and valuation multiples that remain below long-term norms. Here are five charts that illustrate a historic first half for European banks: Societe Generale Leads Gains Societe Generale SA has surged 79% since the start of the year and is trading near its 2017-high as Chief Executive Officer Slawomir Krupa's turnaround plan for the French bank gains traction. Since taking office two years ago, he has focused on exiting non-core businesses, boosting the balance sheet, lifting profitability targets and shareholder payouts. Banco Santander analysts have SocGen as their preferred French bank, citing its potential to surprise on the upside, helped by cost-cutting efforts, they said in June. Commerzbank Surpasses €30 Billion Also among top-performing bank stocks this year is German lender Commerzbank, whose market capitalization surpassed €30 billion for the first time in May. Its multi-year rally has been fueled by earnings strength and takeover interest. Its share price has more than doubled since UniCredit took a stake in September and raised the possibility of a full-blown merger. Still, that move was effectively ruled out by the Italian lender's Chief Executive Officer Andrea Orcel in June, saying such a move would not add value given the stock's rally. Spanish Banks Keep Shining Spanish lenders, which had rallied on the back of higher interest rates, have sustained gains through the European Central Bank's cutting cycle on robust earnings, fee-generating businesses and M&A deals. Banco Santander, which has jumped 57% since the start of the year, has surpassed UBS as the biggest bank in continental Europe by market value. Elsewhere, BBVA SA plans to stick with its bid for smaller peer Banco Sabadell SA, after the Spanish government delayed a potential merger. Deutsche Bank's German Boost Deutsche Bank AG shares have climbed 51% so far this year and are trading around 2015 levels, as the German lender has boosted payouts to shareholders and is set to benefit from the impact of massive government fiscal stimulus in its home country. The firm has made increasing payouts a key element of its strategy as Chief Executive Officer Christian Sewing seeks to lift the share price. Still, concerns over a recent capital ratio disclosure pressured the stock on Monday. Italian Banks Are All About M&A Italian lenders are currently in a deal wave that is set to reshape the country's finance industry. After cleaning up their balance sheets, some firms are turning their sights on takeovers again as surging profits from higher interest rates lifted share prices. UniCredit is among Europe's best performers this year, up 48% as it pursues Italian peer Banco BPM SpA while doubling its stake in a Greek lender. Its market capitalization exceeded that of rival Intesa Sanpaolo SpA in May to make it Italy's largest bank by that metric. Peers Mediobanca SpA and Banca Generali SpA have recently hit fresh record highs. With assistance from Julien Ponthus. This article was generated from an automated news agency feed without modifications to text.
Yahoo
04-04-2025
- Business
- Yahoo
European Stocks Sink Into Correction as Trade Worries Escalate
(Bloomberg) -- European stocks tumbled into a correction on Friday as China retaliated against US tariffs, escalating the global trade war. Housing Agency Aims to Relocate Its DC Headquarters Metro-North Is Faster Than Acela on NYC-New Haven Route After Signal Updates Local Governments Vie for Fired Federal Workers London Clears Final Hurdle for More High-Speed Trains to Europe What Would 'Transportation Abundance' Look Like? The Stoxx Europe 600 Index slid 5.1% at the close in London, recording its worst weekly drop since the outbreak of the Covid-19 pandemic five years ago. Indexes in Italy, France, Switzerland and Germany were also in correction territory after news that Beijing would impose a 34% tariff on all imports from the US, starting April 10. Banks were the biggest laggards, with the Stoxx 600 Banks Index sinking as much as 10%. Italy's FTSE MIB Index — weighed down by the weakness in banking stocks — led losses among major European benchmarks with a 6.5% slide. 'Every portfolio has to adjust themselves for a recession in a lot of countries,' said David Kruk, head of trading at La Financiere de L'Echiquier. 'Yesterday, the US bore the brunt of the selloff. Now it's our turn.' Still, data showing better-than-expected US job growth in March was somewhat reassuring, according to Amelie Derambure, senior multi-asset portfolio manager at Amundi SA. 'If the data had been really bad, it would have led to the conclusion that the Trump administration and the uncertainty around its policies were already triggering a recession,' said Derambure. Traders had earlier boosted their expectations for the US Federal Reserve to cut interest rates this year. Among individual stock movers, Gerresheimer AG fell 15% after Bloomberg News reported KKR & Co. has walked away from a consortium discussing a takeover of the German maker of drug packaging. Here is what market participants are saying: Max Kettner, HSBC chief multi-asset strategist: 'We don't think the correction is over yet. In fact our measures of sentiment and positioning are still ambiguous at best. Our momentum signals indicate that typical trend-following strategies are still only medium short, and equity exposure on our measure of long-only investors has barely budged so far. Equity market breadth in the S&P500 is nowhere near capitulation levels yet, and in fact is even still much higher than during the rates-driven dip in January. The average stock has actually been flat YTD until yesterday, so we do think there's quite a bit more pain to come until the Fed put can step in' Vincent Juvyns, global market strategist at JPMorgan Asset Management: 'Let me be clear, in no way is this capitulation, it's a slap in the face but this is not capitulation. Indeed you can see that it's the best performing stocks and indexes that are falling the most, like banks, because that's where investors can take their profits. But let me be clear and I say that with conviction: for a long term investors, this selloff creates a lot of buying opportunities. The selloff is overdone in my opinion. Yes there's going to be macro-economic consequences to the tariffs but my point is that for diversified investors, bonds are perfectly doing their job in cushioning the fall in equities' Neil Birrell, chief investment officer at Premier Miton Investors: 'The bifurcation you're getting within different markets is extraordinary. Within equities, it's get out of anything that's rate-sensitives, get into safety' Aneeka Gupta, head of macroeconomic research at Wisdom Tree UK Ltd: 'It's unprecedented to see this in the second day in a row. China's response is predominantly setting the stage. The likelihood now is that if with China leading the way, we're likely to get more countermeasures being put in place by other economies. Right now for market, you could compare it with catching a falling knife. It's quite a difficult situation' Janet Mui, head of market analysis at RBC Brewin Dolphin: 'I think people are fleeing for safety now because the situation appears to be spiraling downward. It is hard to see a scenario where most of the tariffs will be rolled back in the near term. The sentiment shock is going to inflict a lot of harm for both the U.S. and elsewhere' Raphael Thuin, head of capital markets strategies at Tikehau Capital: 'Today we've entered an escalation phase with countries starting to retaliate and it's not possible to know how this will end. We must get used to the idea that this a regime change: growth expectations will be cut down and inflation forecast revised upwards. Even if one ignores for a minute the immediate market action, long term, the horizon has darkened. What's also worrying is that central banks won't be in a position to weigh in that much given that this new cycle is an inflationary one' Susana Cruz, Panmure Liberum strategist: 'It looks like investors are playing it safe, with the announcement of Chinese retaliations adding to the already growing recession risks. They seem to be bracing for more bad news, as sectors with strong momentum before the tariffs, like European banks and industrials, face a deeper selloff. Quality stocks and low volatility are providing some shelter amid the storm.' For more on equity markets: Timing to Go Defensive Has Rarely Been Better: Taking Stock M&A Watch Europe: KKR, Gerresheimer, Carrefour, Shell, BTG, BP Gulf Listings Feeling the Heat on Earnings Misses: ECM Watch US Stock Futures Fall as Sentiment Remains Fragile on Tariffs Trump's 10% Slap: The London Rush You want more news on this market? Click here for a curated First Word channel of actionable news from Bloomberg and select sources. It can be customized to your preferences by clicking into Actions on the toolbar or hitting the HELP key for assistance. To subscribe to a daily list of European analyst rating changes, click here. --With assistance from Sagarika Jaisinghani, Allegra Catelli, Levin Stamm and Paul Jarvis. With Shake Shack in First Class, Airline Food Is No Longer a Joke LA Fire Victims Are Betting on a Radical Idea to Help Them Rebuild India's Destination Weddings Fuel a New Tourist Economy China Tells Kids to Study Manufacturing to Fill Factory Jobs Trump's IRS Cuts Are Tempting Taxpayers to Cheat ©2025 Bloomberg L.P.
