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By Swissquote Analysts
Published on 10.02.2022
Morning news

GlaxoSmithKline 4Q Net Profit Grew on Higher Sales

Topic of the day

British pharmaceutical giant GlaxoSmithKline PLC on Wednesday posted an increase in net profit and sales for the final quarter of 2021. The company said net profit was 749 million pounds ($1.01 billion) for the fourth quarter, up from GBP677 million for the same period the previous year, on sales that grew to GBP9.53 billion from GBP8.74 billion. While sales beat expectations, net profit came short of a company-provided consensus, which saw the metric at GBP1.19 billion. Earnings per share grew to 14.7 pence from 13.6 pence, while adjusted earnings per share--a closely-watched metric that strips off some one-off items--came to 25.6 pence, beating consensus expectations of 23.8 pence. The company declared a dividend of 23 pence for the fourth quarter and of 80 pence for 2021, in line with what the company had previously said. Sales in the pharmaceuticals business grew on year in the fourth quarter, driven by growth in the new and specialty products section, Glaxo said. Vaccine sales, however, took a hit from lower meningitis and shingles shot sales, coming in 7% lower than in the previous year, the company said. Turnover in the consumer healthcare business rose in the quarter, the company said. Glaxo said it expects to deliver sales growth in 2022 of between 5% to 7% at constant exchange rates. Adjusted operating profit is expected to grow between 12% and 14% at constant exchange rates during the year, including some anticipated benefit in royalty income from the Gilead settlement.

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Swiss stocks

The Swiss stock market rose sharply on Wednesday. Investors were encouraged by Wall Street, where good company figures drove the indices upwards. In addition, there were signals of easing in the Ukraine crisis. The SMI gained 1.7 per cent to 12,368 points. All 20 SMI stocks closed in the black. 39.9 (previously: 37.06) million shares were traded. Cyclically sensitive shares were in demand. ABB climbed 2.3 per cent, Geberit 2.4 per cent and Holcim 1.7 per cent. Kühne + Nagel gained 4.3 per cent. Competitor Moeller-Maersk expressed confidence in an outlook. The market was also driven by heavyweight Roche, which rose 2.9 per cent. The stock has some catching up to do because it has significantly underperformed competitor Novartis since the beginning of the year. Novartis rose by 0.5 per cent.

International markets


European equity indices closed sharply higher on Wednesday, benefiting from encouraging corporate reports, easing geopolitical tensions and lower bond yields. The Stoxx Europe 600 index gained 1.7% to 473.3 points. In Paris, the CAC 40 and the SBF 120 each gained 1.5%. In Frankfurt, the DAX 40 advanced 1.6% and the FTSE 100 in London gained 1%. ABN AMRO Bank NV reported on Wednesday a significant rise in net profit and operating income for the fourth quarter of 2021, which came in above market views, and said that it is launching a share buyback program of 500 million euros ($570.9 million). The Dutch lender posted a net profit of EUR552 million, compared with EUR54 million a year earlier. It had been expected to post a net profit of EUR451 million, taken from the bank’s compiled analysts’ consensus. Danish jeweler Pandora AS on Wednesday proposed a new 3.3 billion Danish kroner ($506.2 million) share buyback and said its current performance remains solid, with sustainable and profitable growth expected to continue “We end 2021 on a high note with record-breaking revenue and sell-out in 4Q,” Chief Executive Alexander Lacik said. “With network expansion accelerating in 2022--I am confident that we have all the ingredients to deliver sustainable and profitable revenue growth in the years to come,” Mr. Lacik said.

United States

U.S. stocks rose and government-bond yields fell Wednesday following a recent climb, potentially easing some pressure on technology shares. The S&P 500 rose 1.5%. The Dow Jones Industrial Average climbed 0.9%, while the Nasdaq Composite added 2.1%. While all three indexes are up this week so far, they are in negative territory year to date. The session's advance came as all 11 sectors within the S&P 500 rose. Many were up at least 1%. Analysts said recent volatility could continue until investors get clear guidance from the Fed about the rate increases ahead. Some are betting the turbulence will continue throughout 2022. Fresh inflation data due Thursday is expected to give investors additional clues as to how quickly the Fed may raise rates after slashing them in 2020 to cushion the economy from the impact of Covid-19.Uber Technologies Inc.’s revenue climbed 83% in the last quarter of 2021, helped by a recovery in its rides business and continued demand for food delivery despite restaurant reopenings. The company posted revenue of $5.78 billion for the three months ended Dec. 31, beating the average estimate of $5.35 billion from analysts polled by FactSet. Its rides bookings rose by 67% year-over-year while its food-delivery bookings jumped 34% over the same period. Uber ended the quarter with 118 million active customers, a record for the company. Uber’s stock was up about 6% in after-hours trading Wednesday. A California regulatory agency said it has filed a lawsuit against Tesla Inc., alleging racial discrimination and harassment at the electric-vehicle maker. The California Department of Fair Employment and Housing said it filed the complaint Wednesday in Alameda County Superior Court.


East Asian equity markets shook off the firm lead from Wall Street on Thursday and trended inconsistently within narrow limits. Tokyo is still the strongest performer, with the Nikkei index up 0.3 per cent at 27,671 points, but it had already gained 1 per cent at its high for the day. The Chinese stock exchanges, on the other hand, fell by 0.3 per cent. Speculation that the USA could impose new punitive tariffs on Chinese imports if the current talks between the two countries on China buying certain US products as agreed fail.


Bonds yields took a breather, the yield on the 10-year Treasury fell to 1.92% on Thursday, down from 1.95%, the highest it's been since before the pandemic began. The 10-year Treasury yield hit its highest level since July 2019 on Tuesday, while the 2-year yield carved out another 52-week high Wednesday as investors prepare for the next U.S. inflation reading.


HSBC raises the Publicis target to EUR 77 (70) – Buy

UBS raises the Novartis target to CHF 84 (82) – Neutral

CS raises the BNP Paribas target to EUR 74 (72) – Outperf.

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