EUROPEAN OPEN: ROG SW backs guidance

EUROPEAN OPEN: ROG SW backs guidance; BC IM sales rise; SYM1 GY to buyback shares; UBSG SW chief to step down in 2027; judge says ORSTED DC can resume Revolution Wind; ASM NA downgraded

• European equities open higher, buoyed by positive sentiment ahead of US CPI data and bank earnings.
• Oil prices rise following President Trump's tariff announcement on countries trading with Iran.
• Key corporate movements include UBS CEO's planned departure and Symrise's share buyback.

European markets opened on a positive note, reflecting optimism ahead of key US economic data and corporate earnings. The focus is on the US Consumer Price Index (CPI) release, which is expected to provide insights into inflation trends and potential monetary policy adjustments. Analysts are closely monitoring the CPI figures, with expectations of a 0.3% month-on-month increase, maintaining the annual rate at 2.7%. This data is crucial as it could influence Federal Reserve policy, particularly in light of recent comments from Fed officials and market speculation about interest rate adjustments.

In the commodities market, oil prices have surged to their highest levels since November. This follows President Trump's announcement of a 25% tariff on countries conducting business with Iran, pushing Brent crude near USD 64 per barrel and WTI crude close to USD 60 per barrel. The lack of further details from the White House has left traders speculating on the potential impact on global oil supply and demand dynamics.

In the corporate sector, UBS is in the spotlight as CEO Sergio Ermotti plans to step down in 2027 after overseeing the integration of Credit Suisse. This development comes amid UBS's opposition to proposed Swiss banking reforms, which the bank argues could undermine its competitiveness. Meanwhile, Symrise has announced a EUR 400 million share buyback and plans to divest its terpenes business, which will result in a non-cash impairment impacting its EBITDA.

In the currency markets, the Japanese yen has weakened against the US dollar, reaching its lowest level since July 2024. This movement is attributed to speculation about a potential snap election in Japan and comments from former Bank of Japan board member Makoto Sakurai regarding possible interest rate hikes. The South Korean won also continues its downward trend, marking its longest losing streak since 2008 as investors shift funds overseas.

Gold prices have steadied near USD 4,580 per ounce after reaching record highs, driven by concerns over the Federal Reserve's independence amid political tensions. Analysts at State Street suggest a 30% chance of gold reaching USD 5,000 per ounce this year, citing factors such as geopolitical risks and central bank buying.

In the equities market, notable movements include Sanofi's expectation of maintaining double-digit growth and Bayer's pharmaceuticals unit returning to growth. Meta Platforms' strategic shift towards AI and away from Metaverse products has implications for EssilorLuxottica, as augmented reality teams are expected to remain largely unaffected.

Trader Insight:

• Traders are closely monitoring WTI crude prices following the tariff announcement, with potential implications for energy sector ETFs like XLE.
• Market participants are observing USD/JPY movements amid speculation of Japanese fiscal policy changes.
• Some traders may consider assessing gold's potential for further gains, given geopolitical and monetary policy uncertainties.
• Investors are watching UBSG SW shares in light of the CEO's planned departure and ongoing regulatory challenges.

Disclaimer: This is not trading advice. For informational purposes only.