On Greece, Europe and the Fed. MS cautious on Europe, Barclays gives a list of M&A targets.

Futures indicate markets to open up. Probably on better than expected German GDP. MAcro eyes on ZEW, US CPI, Empire manufacturing and retail sales…


Moody’s Downgrades Italian Banks; Outlooks Remain Negative
– Cuts 26 Italian bank’s rating.
– Unicredit, Intesa, Banca IMI among those affected

GRPN: +33% – Groupon sees 2Q rev. $550m-590m vs est. $558.7m. Sees 2Q operating income $25m-$45m vs est. $31m. Shares up ~14% post-mkt; follows 19% gain today


On Greece
Fresh elections in Greece appear as the most likely scenario now.
If you haven’t seen it, there is a series runnning in the FT (on the FT.com?) describing the risks of contagion and how far it could spread. As written here yesterday, the cost could reach €400bn. Selling by non domestic bondholders in the past 9 months has amounted to €200bn for Italian bonds and €80bn for the Spanish ones. There are still €800bn held by non domestic investors. The contagion would spread through banks obviously… Then there is no answer on what would happen to Europe. Would it survive? HSBC thinks so… Nomura’s Le Marchant may be more realistic and thinks we can’t see more than one move ahead like on a chess board. (from the FT).

On Europe
German Q1 GDP up 1.7% (not seasonnally adjusted) YoY vs expectations of 0.9%. French GDP is…. 0%…
Last night Euro area finance ministers was a non event… But the calendar remains busy with Mr Hollande’s meeting with Mrs Merkel today. Some economic data include the 1Q12 GDP for Eurozone at 11:00 (Paris time) expected at 0.2%.

On the Fed
Tomorrow’s meeting may hint at further easing from the Fed given the economic slowdown in the US, the fiscal cliff and Europe… GS sees either discussions around the benefits of mortgages purchases, more twisting and pros and cons of sterilized assets purchases. Another often mentioned and powerful tool is communication.


MS (Carr) European Equity Strategy

Still cautious, though valuation getting more attractive.
MS’ market timing indicators have reached attractive territory but not full blown recession or crisi levels… MS remains cautious! There is still no sign of capitulation.


Barclays (Shing) European Equity Explorer
No light at the end of the tunnel?

This was published on Friday and Barclays ever bull is cautious on the market as macro momentum continues to deteriorate. He needs to see a turnaround in Chinese growth and progress in spanish structural issues before putting his bullish jacket back on. His calls:
Long FTSE 100 vs SX5E, long European dividend aristocrats, European value-qulity momentum stocks, a basket of potential M&A targets and a basket of Swiss sotcks benefitting from SNB moves. This all makes very good sense to me…

the list of M&A targets:


5 Reasons Why Everyone Is Panicking About Spain – Business Insider http://read.bi/Jz7It6
Another Poll Shows Investors Overwhelmingly Expect Greece To Leave The Euro – Business Insider http://read.bi/Jz7NwS
Greece Weighs Technocrat Government – WSJ.com http://on.wsj.com/KbKQvX


– Allianz 1Q Property & Casualty gross premiums +3.8%
Moody’s cuts 26 Italian banks, outlook remains negative; UNICREDIT, INTESA, BANCA IMI are among those affected
Moody’s says that it will delay plans to downgrade more than 100 banks as it assesses the effect of JPMorgan Chase & Co.’s trading losses and a greater possibility of a euro breakup
– Banco Mare Nostrum, Liberbank, Unicaja and Ibercaja are in talks to merge into a single lender that could form Spain’s fifth-largest lender with assets of €270 billion, says the FT
– Barclays has mandated its Barclays Capital investment bank to sell its French retail unit, reports Les Echos
– IAG Cut to Neutral from Overweight at JPMorgan
– Generali PT Cut to EU12.2 vs EU14.6 at Barclays; Kept at Equalweight
– Swedbank Raised to Outperform vs Neutral at Credit Suisse
– ThyssenKrupp 2Q sales EU10.6b vs est. EU10.5b; 2Q adj. Ebit EU134m vs est. EU85.8m; 2Q EPS EU0.59 loss vs est. EU0.15 loss; says it will sell Waupaca to KPS Capital Partners
– Aeroports de Paris 1Q traffic growth 3.7%, intercontinental traffic +5.7% ; 1Q rev. EU599m
– Renault is to adopt Nissan’s new block-assembly method, reports Bloomberg
– Fresnillo will start up San Julian silver mine and three expansion projects by 2014 as part of drive to boost annual silver output by 55%
– Atlantia PT Cut 3% to EU14.7 at Exane; Kept at Outperform
– Seadrill PT Raised 5% to NOK210 at Exane; Kept at Neutral
– Experian Cut to Neutral From Outperform at Credit Suisse
– Fabege Raised to Buy vs Neutral at UBS
– Holcim Raised to Buy vs Neutral at UBS
– Merck Kgaa 1Q rev. EU2.6b vs est. EU2.61b; 1Q pretax EU246m vs est. EU514.5m; 1Q net income EU176.6m vs est. EU220m ; sees FY sales EU10.5b and Ebitda ex-items EU2.8b- EU2.9b
– Smith & Nephew’s CEO says that medical device companies cause their own profit drop through failing to innovate sufficiently, reports the FT
– Statoil Raised to Buy vs Neutral at UBS
– Total Raised to Buy vs Neutral at UBS

– Sky Deutschland 1Q rev. EU318m vs est. EU313.2m; 1Q Ebitda -EU41m vs est. –EU39.9m; 1Q net loss EU75m vs est. loss of EU64m
– Iliad 1Q sales EU656M; had 2.6 million subscribers at March 31
Declining spending and revenue in financial services continue to pose a risk to IT industry growth
– Nokia remains in talks with Permira over the sale of Vertu, reports Bloomberg
Buy Eutelsat, Top-Pick in satellites, Citi says
-Pernod Ricard has been dealt a blow in efforts to sell its Havana Club rum in the American market after the US Supreme Court decided not to intervene in a rights clash
– Casino will exercise its option to become sole controlling shareholder of Cia. Brasileira de Distribuicao Grupo Pao de Acucar
– Air Berlin 1Q loss EU0.95m vs est. loss EU1.05m; 1Q pretax loss 152.9m vs est. loss EU177.5m; 1Q operating loss EU149.3m vs loss EU188.3m
– AMG 1Q rev $324m; 1Q Ebitda $21.9m; 1Q net $3.5m
– Bauer 1Q rev. EU340m; 1Q after tax loss EU4.8m; expects to achieve FY rev. of EU1.45b, Ebit of EU85m, profit after tax of EU35m
– Bergen 1Q opg revenue NK870m; 1Q net loss NK30.8m
– Carl Zeiss 1H rev. EU431.8m; 1H Ebit EU61.1m; sees 2012 rev. EU830m to EU860m; sees further growth in 2H
Fersa 1Q net loss EU1.06m
– Fonciere Des 6eme Et 7eme Arrond. 1Q rev. EU7.4m
– Impregilo 1Q rev. EU589.6m; 1Q Ebit EU54m; 1Q net EU24.2m
– REN 1Q rev. EU175.2m vs est. EU188m; 1Q Ebitda EU130.7m vs est. EU122.5m; 1Q net EU34.5m vs est. EU31.7m
– RCS MediaGroup 1Q rev. EU414m vs est. EU416m; 1Q net loss EU27.3m vs est. loss EU26.7m
– TF1 1Q rev. EU628.6m vs est. EU563.7m; 1Q net income EU36.4m vs est. EU40.03m
– Total Gabon 1Q net $76m
– Tubos Reunidos 1Q rev. EU120.1m vs est. EU120m; 1Q net EU8.1m vs. est. EU8.1m
– Salzgitter 1Q sales EU2.61b vs est. EU2.50b; 1Q Ebitda EU88.9m vs est. EU80.2m ; 1Q pre-tax profit EU19.6m loss vs est. EU18m loss; 1Q net loss EU15.5m
– Saras 1Q rev. EU3.12b; 1Q adj. net loss EU36.6m
– Stratec sees sales to meet or exceed EU160m in 2013 vs est. EU165.5m; sees average sales growth 14%-16% in 2012-2014 based on 2011 sales of EU116.6m; sees Ebit 17%-19% in 2012 and 2013
– De Longhi PT Raised to EU12.9 vs EU12.6 at Mediobanca; Kept at Outperform
– Landi Renzo PT Raised 8% to EU1.4 at Exane; Kept at Underperform
– MIFA Mitteldeutsche Fahrradwerke Rated New Hold at Berenberg


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