Research Market strategy
By Swissquote Analysts
Published on 07.12.2021
Morning news

Saint-Gobain Agreed to Buy GCP Applied Technologies

Topic of the day

Compagnie de Saint-Gobain SA said Monday that it has agreed to acquire GCP Applied Technologies in a deal valued at around $2.3 billion. The French construction-materials company plans to take over all outstanding shares of GCP for $32 a share in cash. The price represents a premium of 39% above the volume-weighted average price of each GCP share for the 30 trading days ended on Nov. 30, it said. The boards of both companies have approved the deal but it still is subject to GCP shareholders’ approval. GCP investors Starboard Value LP and Standard Industries Inc. have pledged to vote their respective stakes in favor of the deal, Saint-Gobain said. “Saint-Gobain expects to benefit from at least $13 million Ebitda impact from top-line synergies thanks to an enlarged commercial platform to the benefit of its customers and cross-selling opportunities in multiple geographies,” said the company. It expects the transaction to close by the end of next year.

Swiss stocks

The Swiss stock market continued the volatile trading on Monday. The SMI rose by 1.6 per cent to 12,375 points. Among the 20 SMI stocks, there were 18 price gainers and two price losers. 37.53 (previously: 35.03) million shares were traded. There was also positive news about Roche, the pharmaceutical stock rose by 0.8 per cent. Traders pointed to the launch of a new Corona antigen rapid test by Roche. Competitor shares of Novartis (+1.4%) were also very firm - despite a downgrade by Exane BNP Paribas. In other respects, too, the influence of analysts on price discovery at the start of the week was in part rather small. In the banking sector, UBS lowered the shares of Credit Suisse (+1.3%) to "Neutral" from "Buy". The analysts at JP Morgan, on the other hand, were positive on UBS shares (+1.8%) and reiterated their "Overweight" rating with an increased price target. Lonza (-1.7%), meanwhile, brought up the rear. Julius Baer rose 3.1%, supported by an upgrade to "buy" from "neutral" by UBS. The recent price setback offers a favourable entry opportunity, they said.

International markets


European equity markets rose sharply on Monday, buoyed by hopes that the Omicron variant will not cause a surge in new severe cases of Covid-19 and by rising oil prices. The Stoxx Europe 600 index gained 1.3% to 468.7 points. In Paris, the CAC 40 and SBF 120 gained 1.5% and 1.4%, respectively. In Frankfurt, the DAX 40 gained 1.4% and the FTSE 100 in London gained 1.5%. German manufacturing orders fell in October, missing expectations of an increase amid continuing supply chain disruptions that is curtailing factory activity. Manufacturing orders declined 6.9% on month in October in adjusted terms, following a revised 1.8% rise in September, according to data from federal statistics office Destatis released Monday. Economists polled by The Wall Street Journal had expected orders to increase 0.5%. Orders of intermediatBillionaires Francesco Gaetano Caltagirone and Leonardo Del Vecchio together with banking foundation Fondazione CRT have taken their overall stake in Assicurazioni Generali SpA to more than 15%, the Italian insurer said on Saturday. The Caltagirone Group currently holds a 7.558% stake in Generali, while Delfin Sarl, steered by Mr. Del Vecchio, has a 6.139% stake. Turin-based Fondazione CRT holds a 1.474% stake in the company. Earlier this year, the parties made a deal to use their combined shareholding in Generali to push for a “more profitable and effective management,” challenging Generali’s largest single shareholder Mediobanca SpA.

United States

U.S. stock indexes finished higher as investors assessed early indicators that the Omicron Covid-19 variant may be causing milder illness than previously feared, while bitcoin and other cryptocurrencies edged up from weekend lows. The S&P 500 advanced 1.2%, regaining ground after closing down 0.8% Friday. The Dow Jones Industrial Average added 1.9% while the Nasdaq Composite rose 0.9%. U.S. chief medical adviser Anthony Fauci said on CNN that there didn't appear to be a "great deal of severity" to Omicron, adding the same caveat. Shares of BuzzFeed Inc. gave up sharp early gains on their first day of trading after merging with a special-purpose acquisition company. The SPAC, BuzzFeed. , merged with BuzzFeed in a deal that took the media company public. SPACs are shell companies that are essentially piles of cash that trade on the stock exchange. Once they merge with a company, that company takes their place on the exchange. These deals have become a popular way for companies to go public. The stock jumped more than 40% at its highs before giving up all the gains and falling more than 10%. By midday Monday, shares traded at $8.61, down from the SPAC’s closing price of $9.62 on Friday. Intel Corp. is planning to publicly list shares in its Mobileye self-driving-car unit, the latest move by Chief Executive Pat Gelsinger to revive the semiconductor giant’s fortunes. Intel said it would take the unit public in the U.S. in mid-2022 through an initial public offering of new Mobileye stock. The move, earlier reported by The Wall Street Journal, could value Mobileye at north of $50 billion, according to people familiar with the matter. There are no guarantees Intel, which would maintain majority ownership, will ultimately follow through with an offering.


On Tuesday, friendly conditions on Wall Street led to gains on the stock exchanges in East Asia and Australia. In Hong Kong, investors are relieved about a possible restructuring of the debts of the ailing real estate group Evergrande. China's stock markets were also supported by the Chinese central bank's 50 basis point cut in the minimum reserve requirement for banks. This was announced after the close of trading on Monday. This increases liquidity in the banking system and lowers companies' financing costs.


The yield on 10-year German government bonds, or Bunds, will "probably have room" to nudge towards the 0% mark in 2022, but it is unlikely to move beyond that level, said Antonio Cavarero, head of investments at Generali Insurance Asset Management, which manages EUR470 billion worth of assets.


JP Morgan raises UBS target to CHF 21 (20) – Overweight
UBS lowers Henkel target to EUR 74 (92) – Neutral
Credit Suisse lowers Orange to Neutral (Outperform) – Target EUR 11

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