The latest Market Talks covering Equities. Published exclusively on Dow Jones Newswires throughout the day.
0940 ET--CAE is planning to close four to six civil training centers as it looks to streamline operations and boost margins. The move is part of the flight simulator company's plan to achieve about C$125 million to C$150 million in structural savings by fiscal 2030. CEO Matthew Bromberg says on an investor call that right-sizing the physical footprint will "not only improve utilization rate of our network, it will also improve our civil margins." Some customers will be lost, however Bromberg says that the company expects to "retain almost all of our customer contracts as we transition them to other CAE facilities," capping expected customer attrition at less than 1% of civil revenue. (adriano.marchese@wsj.com)
0857 ET - Hapag-Lloyd's second-quarter results were broadly in line, but Deutsche Bank analysts say they remain cautious on the timing of the Red Sea reopening. The container shipping market has shown short-term strength recently, the analysts say in a note. However, the German shipping company's first half overall was weighed down by operational disruptions, particularly in the first quarter. The analysts add that a large order book for the sector could have an impact on freight rates. The Iran-backed Houthi militia in Yemen recently said it would blockade Saudi ships in the Red Sea, which would upend a route used to circumvent closures in the Strait of Hormuz. Shares in Hapag-Lloyd rose 1.87%. (aimee.look@wsj.com)
0747 ET - Yeti Holdings reports 2Q sales in line with Wall Street estimates but earnings that are well ahead of expectations even without the benefit of tariff refunds, according to William Blair in a research note. The company, known for its insulated drinkware, raises its full-year earnings outlook, while maintaining its full-year sales growth forecast of 7% to 8%. "We expect the Street to be disappointed by the top-line performance during the quarter and the lack of a raise to the guide, where we estimate the buy-side was looking for something closer to 8% to 9% sales growth for the full year to help boost the credibility of management's long-term target in the high-single- to low-double-digit range ahead of its investor day on September 17," analysts Phillip Blee and Olivia Witte say. Yeti is off 3% premarket. (connor.hart@wsj.com)
0731 ET - Standard Bank Group beat consensus profit expectations due to a continued strong credit performance despite slightly weaker revenue than expected, Citi analyst Simon Nellis says. The Johannesburg-based bank was also helped by contributions from corporate and investment banking, insurance and asset management and its joint venture with ICBC, Citi writes. The bank backed its full-year guidance and 2028 targets. However, a prolonged conflict in the Middle East would harm the outlook for most of its markets, Nellis says. Citi has a buy recommendation on the stock and a 325 South African rand target price. Shares are up 1.2% at 327.20 rand. (michael.hennessey@wsj.com)
0723 ET - Bitcoin rises marginally as U.S. stock futures climb after subdued U.S. inflation data Wednesday dampened expectations for an immediate interest rate rise by the Federal Reserve. "With both headline and core inflation cooling in July, the Fed can afford to take more time deciding whether tighter policy is warranted," XM analyst Raffi Boyadjian says in a note. However, the market reaction is somewhat muted as a rate increase in September cannot be ruled out given further data are due before the meeting and inflation remains too high, Boyadjian says. Moreover, inflation risks are still elevated without a deal on reopening the Strait of Hormuz, the analyst adds. Bitcoin rises 0.1% to $63,577, LSEG data show. (renae.dyer@wsj.com)
0704 ET - Chip maker CXMT dethroned tech giant Tencent as China's most valuable company, taking the crown after surging capital spending pushed Tencent's stock down 4.5% in Hong Kong. The Chinese memory maker's shares ended 1.2% lower in Shanghai. That put CXMT's market capitalization at the equivalent of roughly $524 billion versus about $510 billion for Tencent. Although Tencent more than doubled its capex in 2Q for compute procurement to support its AI model and agents, its management's response to expected returns on AI investments appeared vague to some analysts. Investors have also cooled on Tencent lately, leading shares to fall more than 20% this year. By contrast, CXMT has been an investor darling, with the chip maker widely seen as a proxy of China's push for chip self-sufficiency. (sherry.qin@wsj.com)
0648 ET - Admiral Group's performance is a sharp contrast to commercial and reinsurance stocks experiencing property and casualty cycle downturns, BofA Securities' analysts write. BofA increases its expectations for 2026, as first-half rate rises will earn through better than expected, while market pricing momentum is improving. The first half was Admiral's trough for earned pricing, the analysts add. Admiral's booked motor loss ratio for the first half improves visibility for the earnings recovery in 2027 and 2028, BofA notes. The figures support a return to 2027 topline growth, BofA says. BofA reiterates its buy recommendation for the U.K. insurer's stock and raises the price target to 42 pounds from 37 pounds. Shares are up 1.0% at 38.66 pounds. (michael.hennessey@wsj.com)
0623 ET - ABN AMRO Bank is one of the best investments to gain from higher short-term interest rates in Europe, Citi analysts say. Citi raises its price target for the Dutch bank's stock to 50 euros from 41.40 euros, after taking into account its 2029 forecasts. The company's increased 6.8 billion euro commercial net interest income guidance for 2026 is conservative, Citi says, with Citi's own estimate between 1% and 2% higher. At current interest rates, a long-term return on equity in the mid-teens percentage range is attainable, the U.S. bank writes. Citi maintains its buy rating on the stock. Shares are up 1.7% at 42.51 euros. (michael.hennessey@wsj.com)
0612 ET - Birkenstock reported encouraging sales trends, which can be read as a sign of healthy brand momentum, analysts at Bernstein say. The German sandal maker logged third-quarter revenue of 719.5 million euros, 15% higher on year on a constant currency basis. This was ahead of the expected 14% rise, according to sell-side consensus, the analysts write in a research note. Both the direct-to-consumer and the wholesale channels recorded better-than-expected increases in revenue for the quarter, they add. (andrea.figueras@wsj.com)
0558 ET - Baidu faces greater risks than peers such as Alibaba and Tencent, despite its advantages in the search-engine market, strong AI capabilities and a large net cash position, says Fitch Ratings, which downgrades the company's long-term issuer default rating to A- from A. "Tencent's and Alibaba's EBITDA scale are significantly larger, have greater revenue diversification and stronger cash-generation," Fitch says. The two companies' social network and e-commerce platforms also have a larger share of advertising spending than Baidu's search engine, Fitch adds. (tracy.qu@wsj.com)
0550 ET - The structural decline in Baidu's search ad business prompts Fitch Ratings to downgrade the company's long-term issuer default rating to A- from A. Emerging AI search and competing chatbots are also likely to erode Baidu's search business monetization, Fitch says in a note. Baidu's lower profitability reflects a weakening legacy business and relatively lower margins for non-marketing business, but Fitch reckons growing AI business revenue can largely offset the legacy decline. Baidu has integrated AI-generated content in its search results, which can help retain some user traffic. Fitch's stable outlook on the company reflects the view that it has the opportunity to capture growth across the AI value chain to drive Ebitda recovery. Fitch also expects Baidu to maintain a net cash position medium term, despite higher capex and shareholder returns. (fabiana.negrinochoa@wsj.com)
0521 ET - M&G is beginning to look relatively expensive, with a more limited long-term earnings per share growth outlook than peers, J.P. Morgan analysts write. JPM lowers its recommendation for the U.K. investment manager to underweight from neutral, but maintains the price target of 335 pence. The U.S. bank forecasts attractive operating profit growth in the near term. However, the longer-term outlook is more limited than peers, which the stock now trades broadly in line with, the analysts note. "Importantly, M&G looks relatively weak on its capital return outlook," JPM says. M&G isn't a clean takeover candidate due to its valuation premium, JPM adds. Shares are up 0.7% at 354 pence and have climbed 21% over the year to date.
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