The latest Market Talks covering Equities. Published exclusively on Dow Jones Newswires throughout the day.
1305 ET - Mattel promotes Roberto Stanichi to president and chief marketing and brand officer, signaling a potential answer to recent questions about succession planning. Questions arose earlier this year when President and Chief Commercial Officer Steve Totzke--who was widely viewed as second-in-command and a potential CEO successor--said he would step down. In the past, the president has been viewed as a front-runner to be the next CEO. Such was the case for prior president Richard Dickson, who was viewed as a potential CEO before he departed Mattel in 2023 to helm Gap. When asked about succession planning earlier this year, Mattel CEO Ynon Kreiz said the company has been actively reshaping its leadership team, and as part of that effort, previously elevated Stanichi to chief global brand officer. (connor.hart@wsj.com)
1213 ET - Holcim's growth momentum continues and with the three months through June marking the 17th consecutive quarter of positive price over cost, its execution is undeniably impressive, RBC Capital Markets analyst Anthony Codling says in a research note. The building-materials company saw beats across all three regions, leading to an upgrade in its full-year guidance. While Holcim has a high quality track record, with Europe turning a corner, some challenges remain, Codling says. The U.K is still soft and volumes in Latin America were slightly negative, the analyst adds. Sharesclosed 2.8% lower at 73.34 Swiss francs. (nina.kienle@wsj.com)
1154 ET - Taco Bell sales look like they'll maintain their momentum as the chain puts its food safety issues behind it, UBS analysts say in a research note. Yum Brands just reported a 7% jump in same-store sales for 2Q at its taco-slinging subsidiary, reflecting solid product innovation, compelling value offerings, strong operational execution and gains in its digital channel and loyalty program, the analysts say. The near-term impact of cyclospora-related illnesses linked to lettuce it served was meaningful, hitting the July 18 weekend the hardest, they say. But trends have steadily improved, with a roughly 50% recovery in average sales from the worst levels, showing the pressure is transitory, the analysts say. (dean.seal@wsj.com)
1149 ET - According to CoinGlass data, bitcoin ETFs saw inflows of $233.1 million yesterday. That's the largest inflow in these ETFs since July 6, according to CoinGlass. Bitcoin ETFs have seen net inflows for two straight sessions, and analysts say that even though bitcoin prices look to remain rangebound, the return of ETF interest is a good sign for the future. "[It] signals that institutional investors have not abandoned the market," says Rania Gule of XS.com in a note. But Gule adds that a much-stronger showing on the ETF side is needed to break bitcoin prices out of its current trading range. Bitcoin is down 3.4% to $62,526, while ethereum falls 3.4% to $1,855. (kirk.maltais@wsj.com)
1144 ET - Bitcoin is down 3.3% to $62,616, with liquidations of long positions seeming to pick up in the past hour, according to data from CoinGlass. Some $62.2 million-worth of long positions have been liquidated in the last hour, which is a big pickup from earlier in the day. By comparison, only $1.1 million in short positions have been liquidated, says CoinGlass. Bitcoin did get a boostin reaction to the Federal Reserve's decision to leave interest rates unchanged on Wednesday, but that enthusiasm seems to have been sapped. "The near-term disagreement is now more about the timing of any hike than whether inflation has fully returned to target," says Coinbase Institutional in a note. Ethereum is down 3.2%, XRP is down 1.9%, and solana falls 2%. (kirk.maltais@wsj.com)
1134 ET - Saint-Gobain encourages with the improvement in second-quarter organic sales growth, while its portfolio evolution should help margin progression over the midterm, Berenberg analyst Harry Goad says in a research note. The year has proven more challenging for French building-materials supplier, with inflationary pressures providing an unexpected headwind to profit progression, Goad says. Nevertheless, the quarter saw the first positive organic revenue since the first quarter of 2023, he adds. "This is a clearly positive development although we think it is prudent to wait to see confirmation of this positive trend," he says. Shares trade 7.4% higher at 81.68 euros. (nina.kienle@wsj.com)
1105 ET - Heidelberg's chief executive expects there to be changes in the way houses are built in the face of natural-disaster risks. While wildfires, flooding, heavy rain events and tornadoes are nothing new, they push insurance rates higher, Dominik von Achten says in an interview. "There are changes in housing structures coming, but I think it needs to be with decarbonized or lower carbon products because otherwise you don't solve the problem," the CEO of the German building-materials group adds. Heidelberg shares trade 2.5% lower at 160.25 euros. (nina.kienle@wsj.com)
1046 ET - Telus's dividend cut and guidance changes were "much worse than expected," says TD Cowen's Vince Valentini in a note. The Canadian telecom company is cutting its dividend by 55%, calling the move a reset, to put the money towards the company's debt repayments. Overall, Valentini says 2Q results "were not that far below our expectations," with "beats in free cash flow, mobile average revenue per unit, and wireless service revenue." However, the analyst also adds, "If we simply take the new dividend (C$0.75) at the current BCE yield (5.8%), then we get a value of C$13.03 per T share." Telus slides 12% to $13.21. (adriano.marchese@wsj.com)
1029 ET - AutoNation's customers are still facing challenges but their financial health is improving, executives tell analysts on a call. The executives say consumers are able to afford more expensive vehicles based on the difference in average price incentives compared with before the Covid-19 pandemic. The company's banking partners are reporting a 20% increase in car loan applications and originations, while delinquencies are improving, Chief Executive Mike Manley says. Within its used-vehicle business, AutoNation saw particular strength in sales of cars priced over $40,000, Manley says. (katherine.hamilton@wsj.com)
1015 ET - Alimentation Couche-Tard's acquisition of Zabka Group is its largest deal to date, tapping into a new growth runway, synergy potential, and a seemingly manageable pro forma leverage position, says TD Cowen's Derek Lessard in a note. The roughly $8.7-billion deal of Poland's largest convenience store operator and its more than 13,000 stores adds immediate scale to ATD, and complements its nearly 400 Circle K locations already in Poland, Lessard says. Management plans to "preserve Zabka's brand, local leadership, and franchise model while sharing best practices across food, private label, loyalty, data analytics, and supply chain," Lessard adds.(adriano.marchese@wsj.com)
1012 ET - Artificial intelligence has been the dominant force in equity markets so far this year, despite a complex geopolitical situation, MSCI chief researcher Ashley Lester says. "A war, the fall of a sovereign government and NATO's most serious test in decades barely dented an equity rally," Lester writes. Instead, significant earnings growth concentrated in a relatively small number of semiconductor and AI infrastructure companies drove markets higher, the researcher says. "Exposure to AI infrastructure has dominated equity returns this year." The Netherlands is the best-performing market in the world, led by supplier of chip-making equipment ASML. The Dutch AEX is up over 16% so far this year, while ASML has soared by around 55%. (josephmichael.stonor@wsj.com)
1003 ET - Mega-cap initial public offerings didn't have significant impact on the performance of index-tracking funds, MSCI chief researcher Ashley Lester says. Several index providers changed rules to fast-track the addition of large, newly-listed companies, including SpaceX. The changes prompted questions over whether their inclusion would significantly change the composition of index funds. "The answer is less dramatic than news coverage would lead you to believe," Lester writes. New listings amounted to less than 2% of total U.S. market capitalization, Lester says. Because index funds weight toward the amount of a company's stock that is tradeable, rather than its total market capitalization, the impact was minimal, Lester says.
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