L'Oreal 1Q Sales Rose
Topic of the day
L'Oreal SA said Thursday that sales rose in the first quarter of the year, with three divisions reporting double-digit growth despite the impact of the coronavirus. The French cosmetics and consumer-products company said quarterly sales came in at 7.61 billion euros ($9.11 billion), up from EUR7.23 billion in the previous year. On a like-for-like basis, sales increased 10.2%. L'Oreal's professional-products division reported a 21% organic sales rise, supported by new trends such as the digitalization of salons, independent stylists and the e-commerce boom. The active cosmetics business jumped 28.7% on a like-for-like basis, gaining market share across geographies, while the luxe division reported a sales increase of 14.6% like-for-like. L'Oreal said first-quarter results outperformed the market and it is confident it will be able to achieve growth in both sales and profits in the year.
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At its high for the day, the SMI benchmark index was less than 50 points away from its record set in February 2020. It gained 0.4 percent to 11,199 points. Among the 20 SMI stocks, there were 11 price losers and 9 price winners. Turnover was 44.97 (previously: 44.43) million shares. All around convincing was a report from ABB on the first quarter. Sales, margin, outlook - the figures and explanations were well received by the stock market. The EBITDA margin was increased by around 30 percent at the start of the year. The share climbed 3.1 percent. Banking stocks were not among the favorites, especially as yields continued to fall. UBS lost 0.5 percent, Credit Suisse 0.1 percent. For the experts of Deutsche Bank Credit Suisse remains a buy even after the losses due to the bankruptcy of the hedge fund Archegos, although they lowered the price target. Although the risk management raises questions, but this is an opportunity for Credit Suisse, according to their assessment. The stock should slowly recover from its less demanding valuation. Luxury goods stocks trended lighter, but to varying degrees. While Swatch lost 1.5 percent, Richemont gave up only 0.1 percent.
European markets mostly rise after upbeat earnings from banks lifted spirits on Wall Street. The Stoxx Europe 600 and CAC-40 are up 0.4%, the DAX gains 0.3% and the FTSE 100 advances 0.6%. GlaxoSmithKline shares rise 5%, topping the FTSE 100 risers after a report claimed activist hedge fund Elliott Management has built a multibillion-pound stake in the U.K. drug giant. Publicis (+3.3%) returned to growth in the first quarter in an environment still marked by the health crisis. Alstom (+0.2%) won a contract worth €125 million from the Italian operator Ferrovienord to supply 20 regional trains for the Lombardy region. Crédit Agricole Italia, a subsidiary of Crédit Agricole SA (-1.2%), raised the price of its takeover bid for Italian bank Credito Valtellinese (which fell 0.7% in Milan) from EUR 10.50 to EUR 12.20 per share. Among DAX companies, SAP gained a further 2 percent following the previous day's good figures. Meanwhile, "Corona" was a common thread running through all the balance sheets: Drägerwerk jumped 10.6 percent after achieving an operating profit margin of just over 16 percent in the first quarter - just half the figure had been expected. Net sales rose by 28 percent. However, the special boom in respiratory equipment is now coming to an end, with orders slumping by around 45 percent. Curevac gained just under 4 percent. The biotechnology company is well on schedule with its new Corona vaccine and is ramping up its production capacity planning.
The Dow Jones Industrial Average closed above 34000 for the first time Thursday after strong earnings and upbeat economic data sent stocks climbing. The blue-chip index advanced 305.10 points, or 0.9%, to 34035.99, its 20th record close of the year. The S&P 500 also notched a record close, its 22nd of the year adding 45.76 points, or 1.1%, to 4170.42. A powerful rally has pushed both indexes up 11% in 2021, and many investors believe the rollout of Covid-19 vaccines and plentiful government spending mean stocks have room to keep rising. The Nasdaq Composite climbed 180.92 points, or 1.3%, to 14038.76, off 0.4% from its February record. Shares of big tech companies pushed indexes higher as the yield on the 10-year U.S. Treasury note recorded its largest one-day decline since November. Falling yields tend to boost technology stocks, which often trade at high prices partly because of expectations of growth far into the future. Apple shares gained 1.9%, while Microsoft shares rose 1.5%. Citigroup and Bank of America have significantly exceeded expectations for their quarterly figures. As with JPM, Goldman Sachs and Wells Fargo the previous day, a combination of slightly better operating business and the reversal of the enormous risk provision is driving the profit performance. However, analysts call Bank of America's costs disappointing. The stock fell 2.9 percent. Already on previous days, it was evident that investors used good bank balance sheets to rake in profits. Citigroup lost 0.5 percent.
Rather subdued is the mood at the end of the week on the stock exchanges in East Asia. In Asia, the Corona fall numbers rise in many places. The Nikkei 225 index is 0.1 percent up at 29,679 points. Slightly stronger, namely by 0.5 percent, the Composite Index in Shanghai increases. The HSI in Hong Kong was little changed. In Seoul, too, the Kospi index hovered around the closing price of the previous day.
The 10-year note yield fell 10.6 basis points to 1.531% on Thursday, the lowest in four weeks, and marking its biggest daily drop since early November. It was recently at 1.585%.
Citi raises target Kuehne + Nagel to 212 (143) CHF - Sell
Deutsche Bank lowers target Credit Suisse to CHF 12 (15) - Buy
Jefferies lifts RWE target to EUR 43 (40) - Buy
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