The latest Market Talks covering Basic Materials. Published exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.
0603 GMT - Henkel's first-half results demonstrated strong volume trends, Berenberg analysts say in a note. There were robust volumes in adhesive technologies, with a tailwind from forward buying, they say. Underlying growth was also supported by the electronics and industrial business, with management noting a particular stabilization of its automotive business in the second quarter. (aimee.look@wsj.com)
0551 GMT - Clariant's litigation risk has eased and the Swiss chemical company's earnings growth next year should allow share outperformance, Berenberg analyst Sebastian Bray writes in a research note. According to Bray, Clariant has two advantages over the diversified chemicals sector. First, the threat related to cartel litigation in Europe has become manageable after a recent Dutch court decision. Second is a recovery in catalysis alongside abating forex headwinds that should let Clariant generate good earnings growth in 2027, he says. Berenberg upgrades Clariant to buy from hold and raises the target price to 12 Swiss francs from 7.80 francs. Shares closed Tuesday at 10.04 francs. (sarah.sloat@wsj.com)
0225 GMT - There's a risk of softer lithium-market conditions in 1H 2027 as concerns about oversupply re-emerge, says Macquarie. That could be "potentially exacerbated by an accumulation of ESS [energy storage system] inventories across the value chain over the next six months," it says. To be sure, investors appear to have at least partially priced in this risk already, says the bank. Near-term conditions meanwhile "appear more constructive, underpinned by a tightening spot market and ongoing inventory drawdowns across the supply chain," Macquarie says. IGO is the bank's top pick among ASX-listed lithium stocks. Macquarie cites attractive free cash flow yields across varying lithium-price scenarios. IGO shares are up 2.8% at A$8.02. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)
0212 GMT - While coal miner Coronado Global Resources is showing operational improvement, sustained performance over 2H will be key to achieving production and cost targets for 2026, says Macquarie. Lower expectations for metallurgical coal prices, meanwhile, weigh on the outlook for Coronado's earnings and share-price performance, Macquarie says. The bank cuts its target price by 50% to A$0.20/share. It downgrades the stock to neutral from outperform "in the absence of a more attractive met-coal market backdrop." Shares are down 5.9% at A$0.16. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)
0012 GMT - Any weakness in SGH shares is an opportunity to buy, according to Morgan Stanley analysts Joseph Michael and Julianna Sick, who view FY27 as "a transition year, not a thesis break." Shares in the ASX-listed industrial conglomerate fell by more than 10% Tuesday after below-consensus FY27 guidance. The MS analysts say an FX headwind masks stronger underlying growth and that their positive thesis is unchanged. "SGH remains a high-quality industrial compounder with privileged assets and direct exposure to Australia's structural capex cycle," they say. MS trims its target on the stock to 48.00 Australian dollars a share from A$49.00/share but keeps an overweight rating. Shares are up 1.1% at A$42.03.(rhiannon.hoyle@wsj.com; @RhiannonHoyle)
2338 GMT - Nickel Industries has demonstrated it is capable of producing nickel cathode at the Excelsior Nickel Cobalt project, "a significant milestone" following maiden mixed hydroxide precipitate production in July, says Morgan Stanley. The bank assumes ENC will reach full production by 1Q 2027. Management hasn't disclosed the expected product mix from the project, MS says. "We assume cathode represents a relatively small proportion during LME [London Metal Exchange] brand registration, with upside from premium Class 1 pricing once registered," it says. MS has an equal-weight rating and A$0.80 target on Nickel Industries. Shares last traded at A$0.845. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)
1820 GMT - Silver futures snap a two-session winning streak, with the front-month contract dropping 0.5% to $64.769 a troy ounce, but selling pressure isn't expected to last. "We expect continued recovery in investment demand driven by an eventual Strait of Hormuz de-escalation and a less hawkish Fed," says analysts with Citi Research in a note. "We expect silver to continue to track gold in direction with high beta, making it an ideal upside play in our view for a quick Strait of Hormuz resolution." Citi says silver prices could climb to $95/oz by next year, but also maintains a 20% chance for silver prices to slide to $50/oz. Front-month gold settles up 0.5% to $4,383/oz. (kirk.maltais@wsj.com)
1444 GMT - Most-active gold futures are up 0.6%, even after U.S. forces fired on a Panama-flagged ship that attempted to run the American blockade of Iranian ports. Elevated fighting in the Middle East was a factor pressuring gold prices in the past, but that seems to be changing, says Commerzbank in a note. "In recent months, the correlation between gold and oil has mostly been negative, as a rising oil price has also pushed up expectations of Fed interest rate hikes," says the firm. "That has not been the case this time." Gold and oil both finished the day higher on Monday, an unusual move in the course of the Middle East war.
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