By Swissquote Analysts
Credit Suisse CEO Thomas Gottstein Set to Depart
Topic of the day
Mr. Gottstein has headed the bank since the start of the pandemic and presided over a series of costly mishaps, including the implosions of clients Greensill Capital and Archegos Capital Management in early 2021. Credit Suisse posted a loss of 1.59 billion francs. In the previous year, a profit of 253 million francs was still achieved. Net income fell by 29 per cent to 3.645 billion francs. Assets under management decreased to 1.454 trillion from 1.632 trillion francs. Credit Suisse parts ways with CEO Thomas Gottstein. The bank announced that Ulrich Körner, currently head of asset management, has been appointed as CEO with effect from 1 August. The bank also announced a comprehensive strategic review. Credit Suisse is to become a more focused, agile group with a significantly lower cost base. The global wealth management business, the universal bank in Switzerland and the asset management business with multiple diversifications are to be strengthened. Options are to be explored for the securitised products business. The absolute cost base of the Group is to be reduced to below CHF 15.5 billion in the medium term.
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On Tuesday, the SMI lost 0.2 per cent to 11,102 points. Among the 20 SMI stocks, there were twelve price losers and eight price gainers. 48 (previously: 29.32) million shares were traded. UBS shares decreased by 9.4 per cent after the bank reported a small increase in second-quarter earnings, but the results fell short of analysts' expectations. The net profit of 2.11 billion dollars was clearly below the expectation of 2.40 billion dollars. However, this could still be explained by the market volatility, as it had already become apparent with the US banks, said one trader. He described the decline in income from asset management as "more unsatisfactory". However, some other key figures were good, such as the core capital ratio of 14.2 per cent. In tow, Credit Suisse lost 3.4 per cent, the bank will report its figures on Wednesday. Logitech's 9 per cent drop in like-for-like currency sales was worse than feared, which also put pressure on profits, traders said. Accordingly, Logitech is lowering its forecast for the year. However, the previous year's quarter had also been a record quarter, which put the decline in sales into perspective. After losses at the opening, the share turned positive and closed 1.7 per cent firmer. The business figures of Lindt & Sprüngli (+5.7%) were described as very good in trading. The EBIT margin of 9.3 per cent was well above the expected 8 per cent as well as joined by a share buyback of CHF 1 billion.
European stocks were mostly lower on Tuesday following some mixed corporate updates and as investors focused on the Federal Reserve's next likely increase to its target interest rate. They also took note of a further reduction in its growth forecasts by the International Monetary Fund (IMF). The Stoxx Europe 600 index ended almost flat at 426.1 points. In Paris, the CAC 40 and the SBF 120 both lost 0.4%. In Frankfurt, the DAX 40 gave up 0.9%, while in London the FTSE 100 was unchanged at the close. Gains for Unilever and the oil majors helped stabilise London's FTSE 100. BP and Shell were among the biggest risers as fresh uncertainty about European gas supplies from Russia helped boost Brent crude. Eutelsat (-18.2%) announced on Tuesday that it had signed a memorandum of understanding with the main shareholders of OneWeb with a view to bringing together the French satellite operator and the British broadband Internet provider. Soitec lost 8.2%. The semiconductor materials manufacturer revealed experiencing a sharp slowdown in growth in the first quarter of its 2022-2023 financial year, which ends in March 2023. For the period, its revenue came to €202.9 million, a 6% year-on-year improvement in organic terms, compared with a 53% growth rate in the previous quarter. Veolia dropped 3.4%, penalised by JPMorgan which resumed its monitoring of the stock with an "underweight" recommendation. Edenred (+3.6%) raised its gross operating profit (Ebitda) target for 2022 to between €770 million and €820 million. This range corresponds to an organic growth in Ebitda of between 14% and 21%, said the group's CEO, Bertrand Dumazy, during a conference call with journalists. Edenred had previously targeted organic Ebitda growth of at least 10% this year.
U.S. stock indexes ended lower as a mixed set of earnings reports traced an unsteady path forward for markets ahead of a critical Federal Reserve meeting this week. Stocks opened in the red, with losses building as the day progressed. The S&P 500 closed Tuesday lower by 45.79 points, or 1.2%, at 3921.05. The tech-focused Nasdaq Composite declined 220.09, or 1.9%, to 11562.57, and the Dow Jones Industrial Average shed 228.5, or 0.7%, to finish at 31761.54. Shares of Walmart fell by $10.04, or 7.6%, to $121.98 after the country’s largest retailer warned that higher prices for food and fuel were causing consumers to pull back. Target shares were dragged down, too, dropping $5.68, or 3.6%, to $151.81. General Motors shares gave up $1.18, or 3.4%, to $33.34 after the car maker’s second-quarter profit fell short of estimates. Other earnings reports revealed bright spots. General Electric shares added $3.15, or 4.6%, to $71.51 after the company reported better-than-expected results. Consumer-product manufacturer 3M jumped $6.63, or 4.9%, to $140.75 after it said it would spin off its healthcare business to create two public companies. Coca-Cola (+1.6%) posted a decline in earnings, but sales and profits still exceeded market expectations. McDonalds (+2.7%) also surprised positively; the fast food chain was able to implement price increases and thus compensate for higher costs. UPS (-3.4%) reported better-than-expected quarterly profit and revenue on Tuesday and increased its share buyback programme by about 50%. Chinese e-commerce giant Alibaba (+0.2% on ADR) will apply for a primary listing on the Hong Kong stock exchange, as tensions rise between Beijing and Washington over audit documents demanded by US regulators from Chinese companies listed in the US.
In Asia, major indexes broadly closed mixed. While most of the markets are down, the Tokyo stock exchange at least holds its ground, gaining 0.2 per cent to 27,702 points. Shanghai and Seoul show small losses, while in Hong Kong the previous day's strong gains are erased with the HSI slipping by 1.5 per cent. In Hong Kong, weak technology stocks (-1.7%) weighed on the market. Property shares also depressed the market barometer. Country Garden fell by over 13 per cent after the announcement of a capital increase. China Vanke declined by 2.3 per cent, Longfor by 4.4 per cent. In Seoul, LG Energy Solution edged 1.5 per cent lower.
Long-dated U.S. government debt yields mostly closed lower on Tuesday, but not quite as low as they threatened earlier in the session, after a morning bond rally lost some steam. The 10-year Treasury note was yielding 2.80%, down 2 basis points while the 2-year Treasury note rose by 2 basis points to 3.057%.
Deutsche Bank lifts Julius Baer target to CHF 62 (61) - Buy
Jefferies cuts Siemens target to EUR 155 (190) - Buy
Metzler reduces Hypoport target to EUR 200 (242) - Hold
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