The latest Market Talks covering Equities. Published exclusively on Dow Jones Newswires throughout the day.
0854 GMT - A tie-up between BASF and Evonik could prove complicated, analysts at Bernstein write in a note. German chemicals giant BASF said last week it had opened talks with its smaller rival, noting its interest in acquisitions that fuel growth. "There is a price / synergy level where the logic for this transaction could be compelling," Bernstein says. But a takeover of Evonik would skew BASF's assets further toward Europe and a combined group would likely trade at a lower multiple than BASF alone, the brokerage estimates. "We have our reservations about a combined BASF-Evonik equity story, as we believe BASF can extract substantial value from their existing assets and there is no guarantee a transaction goes ahead," Bernstein says. (joshua.kirby@wsj.com; @joshualeokirby)
0849 GMT - ASML Holding has scope to increase its projections of how many chip-making machines it can produce in the coming years, UBS analysts write in a note to clients. The Dutch company said in July that it planned a 30% boost in the output of its deep ultraviolet and extreme ultraviolet machines in 2027 and another 30% in 2028. The analysts say ASML is likely to update those targets to above 30% to meet strong demand for artificial-intelligence chips. They also estimate ASML could guide for 2027 revenue year-on-year growth above 30%. ASML shares trade 0.6% lower at 1,513.20 euros. (mauro.orru@wsj.com)
0846 GMT - ASML Holding's flexibility to adjust prices for its semiconductor-making machines remains the Dutch group's main earnings lever, UBS analysts write in a research note. ASML's finance chief Roger Dassen in July alluded to the possibility of price increases, saying in an earnings call that a tight chip market gave the company better pricing power. Chip makers need more of its machines to churn out increasingly powerful chips that can be used for artificial intelligence. Analysts say they expect customer negotiations to support further price increases across ASML's lineup of deep ultraviolet and extreme ultraviolet machines. ASML shares trade 0.6% lower at 1,513.00 euros. (mauro.orru@wsj.com)
0843 GMT - Although the U.K. government's new help-to-buy housing loan program will benefit large-scale builders, it also presents some potential issues, Davy Research analysts Ciaran Mulqueen and Colin Sheridan say. The plan, named "Your First Home," will substantially boost demand as it provides a significant additional policy support for the sector, but also has the potential to hit demand in advance of implementation, the analysts say. It will likely add to inflationary pressures and will also be supportive of the price of residential land, Davy says. "This is a major incremental positive for a sector that has struggled this year, facing high levels of material-led build cost inflation and rising mortgage interest rates," Davy says. MJ Gleeson and Persimmon are up 15% with Taylor Wimpey and Bellway both trading 14% higher. (anthony.orunagoriainoff@dowjones.com)
0843 GMT - Singapore's manufacturing output is likely to grow unevenly as strong demand for artificial-intelligence hardware supports some segments while rising costs and supply disruptions weigh on others, DBS senior economist Chua Han Teng says in a note. Factory output rose 15.4% on year in August, accelerating from July's revised 6.9% expansion, largely on AI-related demand. Petrochemical firms, meanwhile, face a shortage of feedstock due to the closure of the Strait of Hormuz, he adds.(amanda.lee@wsj.com)
0840 GMT - Banco de Sabadell's revised agreement with Amundi should be modestly positive for the Spanish bank's fees, Citi analysts say in a note. Sabadell agreed to extend its partnership with the French fund manager for five more years to 2035. The deal should have a positive impact on Sabadell's fees, Citi says. However, it is likely to only be modest, with Citi forecasting a 0.4% uplift to consensus 2026 earnings per share. Customer fund growth and deposit beta assumptions--the cost of deposits compared to the average ECB deposit rate--are still likely to be the main factors influencing upside or downside to Sabadell's 2027 earnings, Citi says. Shares rise 0.2%. (michael.hennessey@wsj.com)
0823 GMT - The outlook for gambling in Brazil is highly uncertain following a provisional measure banning most forms of gambling in the country, Berenberg analysts Jack Cummings and Luka Trnovsek write in a note. Last week, Brazilian President Luiz Inacio Lula da Silva signed an executive order banning online sports betting and gaming with immediate effect. "While this does not immediately close the Brazilian market for good, at least for the time being, operators are likely to have to cease operations," they say. In 2025, Brazil accounted for 11% of U.K. sports-betting and gambling group Entain's international online revenue, they note. Shares are down 2.1% at 4.40 pounds. (najat.kantouar@wsj.com)
0816 GMT - Indonesia's move to lower the minimum share price to 1 rupiah from 50 rupiah is likely to have limited impact on liquidity for stocks where investor demand remains weak, Capital Economics' Gareth Leather says. The change should improve price discovery by allowing stocks previously stuck at the 50 rupiah floor to adjust to market-clearing levels, he says. However, he says the move alone is unlikely to materially improve overall market liquidity or fully address concerns over Indonesia's market accessibility and transparency. Some stocks could also fall sharply below 50 rupiah as prices adjust to their underlying value, he adds. (yingxian.wong@wsj.com)
0814 GMT - The U.K. government's new first-time buyers program is likely to have a significant effect on the property sector and home building in particular, Quilter Cheviot analyst Oli Creasey says in a note. The government has fallen behind its target to build 1.5 million homes during this parliament and, although it remains a very challenging target, the program should help get closer to this goal, Creasey says. "The announcement is likely to have a positive effect on house prices, boosting demand and injecting capital into the system," he says. MJ Gleeson and Persimmon are up 15%, with Barratt Redrow and Taylor Wimpey trading 14% higher. (anthony.orunagoriainoff@dowjones.com)
0810 GMT - Shares of European semiconductor companies are in the red following a selloff in Asian chip stocks. South Korea's SK Hynix closed nearly 5.1% lower, while Samsung Electronics shed 5.4%. In Europe, shares of Dutch semiconductor-equipment maker ASML Holding and smaller rival ASM International are down 1% and 1.4%, respectively. BE Semiconductor Industries, the Dutch supplier of semiconductor assembly equipment, is down 1.7%. German chip maker Infineon Technologies stock loses 1.3%. STMicroelectronics shares are down 0.1%. Meanwhile, the E-mini Nasdaq 100 futures contract edged 0.8% lower, pointing to a weak opening for tech stocks in the U.S. (mauro.orru@wsj.com)
0805 GMT - CapitaLand Ascendas REIT's weakness in its business-park segment has likely been priced into its units, says Morningstar's Xavier Lee in a note, viewing the real-estate investment trust as undervalued. The Singapore REIT's exposure to new economy sectors such as logistics and data centers benefits from strong structural demand, the analyst says. The REIT manager's active portfolio management and capital recycling moves should help to create value for unitholders. CapitaLand Ascendas is among Morningstar's top sector picks. Morningstar retains a 3.00 Singapore dollar fair-value estimate. Units rise 0.4% to S$2.29. (megan.cheah@wsj.com)
0804 GMT - Keppel REIT is likely to benefit from improving office fundamentals, given its high-quality portfolio of Grade A office buildings in central business districts, says Morningstar's Xavier Lee in a note. The Singapore real-estate investment trust's assets are coveted for their good-quality office space and proximity to businesses and key transport nodes, he says. Its portfolio should enable it to weather any economic uncertainty, he says. Lee reckons the trust is undervalued at the current price, as it trades at an attractive 2026 distribution yield of 6.1%. Keppel REIT is one of Morningstar's top sector picks. Morningstar retains a fair-value estimate of 1.10 Singapore dollars. Units rise 0.6% to S$0.85.
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