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Research Market strategy
by Swissquote Analysts
Morning News

Mediaset Shareholders Back Plans to Create Dutch Holding Company

Topic of the day

Mediaset SpA (MS.MI) said that its shareholders approved plans to create a pan-European media and entertainment holding company at today's extraordinary general meeting. The Italian broadcasting company wants to establish Media for Europe NV, a Dutch holding company, through the merger of its Italian and Spanish operations, which shareholder Vivendi SA (VIV.FR) opposes. "The MFE project is confirmed and proceeds," Mediaset said, describing the project as a "priority." Mediaset said earlier Friday that Simon Fiduciaria - an asset trust which holds a stake in Mediaset on behalf of Vivendi SA (VIV.FR) - wouldn't be able to exercise voting rights at the meeting. A court hearing about Mediaset's merger-related dispute with Vivendi is set for Jan. 21.

Swiss stocks

In tandem with other markets in Europe and the US, the SMI barely moved Friday, closing down 0.1 percent on 10,639 points on weaker-than-expected US labour market data, though traders said the US labour market was still in good shape. Nervousness reigned amid growing indications that the Ukrainian passenger jet that crashed in Iran was accidentally shot down by Iran’s military. The US imposed fresh sanctions on Iran. After the previous day’s losses on disappointing financials, Sika recovered 1.2 percent to lead the SMI. Traders said the company still had a solid business model. ABB shrank 0.5 percent on news of job cuts at a plant in Boston, USA. Otherwise, company news was scarce. Zurich Insurance rose 0.2 percent to recoup some of the previous day’s losses. Lafargeholcim brought up the rear of the index, falling 1.1 percent. In the second tier, Basilea surged 5.7 percent on releasing preliminary 2019 financials, with slightly higher turnover above the previously stated target range.

International markets

Europe

European stocks fell as investors digested disappointing U.S. jobs data and worse-than-expected trading updates from retailers. "Equity markets are subdued on the back of the mediocre U.S. non-farm payrolls report," David Madden at CMC Markets said. Retail shares dropped with B&M European Value Retail the biggest faller, down 6.1%, after the budget retailer reported slower-than-expected sales growth over the Christmas period. Ryanair shares rose 5.6%, sending airline shares higher, after raising its full-year profit guidance. The Stoxx Europe 600 fell 0.1% to 419.14 points, the FTSE 100 shed 0.1% to 7,587.85, the DAX declined 0.1% to 13,483.31 and the CAC-40 slipped 0.1% to 6,037.11. Ryanair raises its profit guidance in the company's latest update, with performance boosted by high demand and strong ticket pricing, Goodbody says. The carrier's profits after tax are now expected to be in the middle of a revised range of EUR950 million to EUR1.05 billion, compared with its previous forecasts of EUR800 million to EUR900 million, the Irish stockbroker says. Volkswagen AG (VOW.XE) (+2,1%) said Friday that it has agreed to buy the shares in Diconium that it didn't already own in order to gain expertise in software development and strengthen its digital sales solutions.

United States

The Dow Jones Industrial Average briefly jumped past the 29000 milestone for the first time after fresh jobs data showed that unemployment hovered at a 50-year low in December. The blue-chip index crossed the threshold in morning trading before paring some of its gains. It closed down 133 points, or 0.5%, at 28824, after earlier rising as high as 29009. Shares of Boeing, which slipped roughly 1.9%, pulled the index lower. The S&P 500 and Nasdaq Composite rose in early trading before also edging lower, losing about 0.3% apiece. Despite their declines Friday, all three major indexes notched weekly gains. The weekly advance for U.S. stocks comes after a blockbuster year in which major indexes clinched record after record as the Federal Reserve trimmed interest rates three times. Some investors and analysts say they expect those rate cuts and a strong U.S. consumer to help lift corporate profits and propel the stock market higher in coming months. Although the pace of hiring slowed last year and manufacturing was a weak spot, employers added 145,000 jobs in December, capping a 10th straight year of payroll gains. However, private-sector wages advanced 2.9% in December from a year earlier, the smallest annual gain since July 2018. The pace of hiring slowed last year, reflecting global economic uncertainty, fading effects of 2018's tax cuts and employers' difficulty in finding enough workers. Amazon.com Inc. (-0,9%)has been building a business selling ads on its Fire streaming television platform. Now, it wants to sell some ads for the first time on other streaming TV systems such as Apple TV and Xbox, according to people familiar with the matter.

Asia

In Asia, indexes were up slightly thanks to optimism over Beijing and Washington getting ready to seal the deal, said Stephen Innes, chief Asia market strategist at AxiTrader, although he noted most of the optimism was already priced in.

Bonds

Treasury yields slipped on haven buying, following a tepid December jobs report and the announcement by the U.S. of new sanctions against Iran. The 10-year Treasury note yield slipped 3.3 basis points to 1.825%, while the 2-year note rate was nearly unchanged at 1.570%. The 30-year bond tumbled 4.5 basis points to 2.285%.

Analysis

CS rises the BP target to 605 (580) p – Neutral
UBS rises the Engie target to 16,50 (15,50) EUR – Buy
CS lowers the Burberry target to 2.650 (2.700) p – Outperform


Produced by MBI Martin Brückner Infosource GmbH & Co. KG on behalf of Swissquote. All news is acquired with journalistic accuracy. No liability is assumed for delays or errors.

 
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