Research Market strategy
By Swissquote Analysts
Published on 29.09.2021
Morning news

Santander plans to pay out €1.7 billion to its shareholders

Topic of the day

Banco Santander SA plans to return about €1.7 billion from profits to shareholders this year. That will take the form of dividend payments and a share buyback after the European Union's recommendations to cap shareholder pay were lifted. The Spanish bank announced it would pay a dividend of 4.85 European cents per share and also buy back shares worth 841 million euros. The total amount represents 40 percent of adjusted profit for the first half of the year, the bank said, adding that further and final remuneration from 2021 earnings will be determined in the first quarter of next year. The decision was made against the backdrop of the European Central Bank's lifting of recommendations to cap shareholder remuneration until 30 September, Santander said. The cash distributions reflect Santander's confidence that investing in its shares at current valuations offers an "attractive opportunity" to generate value for shareholders, executive chairman Ana Botin said.

Swiss stocks

Rising market interest rates have spoiled the mood on the Swiss stock exchange as well as on neighbouring stock exchanges in Europe on Tuesday. The SMI lost 1.8 per cent to 11,486 points. All 20 SMI stocks closed with losses. 38.29 (Monday: 33.26) million shares were traded. The fact that the SMI still outperformed many other markets in Europe was helped by the heavyweights Nestle, Roche and Novartis, which are considered less sensitive to the economy and lost a maximum of 1.5 per cent. The relatively moderate losses of bank shares (UBS -0.4%, Credit Suisse -1.1%) also had a supporting effect. Banks are seen as beneficiaries of higher interest rates because these gain the lending business more rewarding. Among the laggards were again Partners Group (-7.0%), which had already been very weak in the market the previous day. There was no new news on the investment specialist, so market participants pointed to the over 53 per cent increase in the share price so far this year, which may have encouraged profit-taking. Logitech (-7.2%) fell even more sharply. In addition to the high interest rates, which in general particularly affected technology shares, which are considered to be sensitive to interest rates, a downgrade to "Underweight" by analysts at Morgan Stanley weighed on the share price.

International markets


European stocks fell as investors digest rising inflation uncertainties. The pan-continental Stoxx Europe 600 fell 2.2% to 452.35 points, led by losses among tech stocks. Capgemini dropped 5.7%, STMicroelectronics lost 5%, Soitec fell 4.8%, Dassault Systèmes dropped 4.4%, while Alten fell 3.4% and Sopra Steria dropped 2.8%. In Paris, the CAC 40 and SBF 120 lost 2.2% and 2.1% respectively. In Frankfurt, the DAX 40 fell by 2.1%, and the FTSE 100 in London gave up 0.5%. Ipsos (-9.6%) dropped its decision to appoint Nathalie Roos as its new chief executive and appointed Ben Page, the head of its UK subsidiary, in her place. Energy stocks rose. In Paris, Vallourec gained 1.9% and Rubis increased by 0.3%. In London, Shell climbed 2.8% and BP gained 1.6%. TotalEnergies was up 1.3% as the group also presented its outlook and strategy at an investor day. The company announced a $1.5 billion share buyback programme for the fourth quarter. Chip giant ASML fell 7.2%. Fintech payments company Adyen slipped 5.4%.

United States

The New York Stock Exchange ended sharply lower on Tuesday as inflation fears and a continued rise in bond yields continued to plague the technology sector. The Dow Jones Industrial Average (DJIA) closed down 1.6% at 34,299.99 points and the broader S&P 500 index fell 2% to 4,352 points. The Nasdaq Composite fell 2.8% to 14,546 points. However, U.S. stock futures rose modestly, suggesting that American markets could regain some ground in Wednesday trading. Futures tied to the S&P 500, Nasdaq 100 and Dow Jones Industrial Average rose between 0.3% and 0.4%. Ford (+1.2%) announced on Monday evening that it will build two battery plants in Kentucky and a third in Tennessee near a new site that will produce its new F-Series electric pickup starting in 2025. The project represents a total investment of $11.4 billion, of which Ford is investing $7 billion and its South Korean partner SK Innovation $4.4 billion. Processor manufacturer Micron's quarterly results (-4.6%), which will be published after the close, will be closely watched by investors in the context of tensions over the supply of semiconductors in the world. AMD (-6%), Intel (-1.2%) and Nvidia (-4.4%) shares also fell. Endeavor gained 5.9%. The entertainment group announced on Tuesday an agreement to buy sports betting company Scientific Games (-0.3%) for $1.2bn in stock and cash. Pharmaceutical company Pfizer (-1.3%) and its partner BioNTech (-10%) submitted to the US Food and Drug Administration data from phase II/III trials evaluating their Covid vaccine in children aged 5 to 11.


On Wednesday morning, Japan’s Nikkei 225 index dropped 2.5%, while the Kospi Composite in Seoul fell 1.6%. In Hong Kong, the city’s flagship Hang Seng Index dropped 0.5%, with Chinese technology stocks following their U.S. peers downward. Sector heavyweight Tencent Holdings Ltd. shed 3%, while food-delivery giant Meituan dropped 3.7%. Shares in China Evergrande Group gained nearly 5%, after the ailing real-estate giant said it agreed to sell part of its stake in a Chinese regional bank for more than $1.5 billion.


Supported by fears of accelerating inflation and the expectation that the Fed will tighten monetary policy, the yield on the 10-year US Treasury bond climbed to 1.534% from 1.485% on Monday evening. The yield on the 30-year bond also jumped 9 basis points to 2.09% after breaking above 2% the previous day for the first time since mid-August. The yield on the German Bund with the same maturity was -0.197%, down from -0.219% on Monday evening.


Jefferies increases Bouygues to Buy (Hold) - Trader
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