2024-01-16 10:38

Jan 16 (Reuters) - UBS Global Research increased its year-end target for the S&P 500 (.SPX) on Tuesday to 5,150, marking the highest projection among major global banks and indicating a potential 8% upside from current levels. The European brokerage had earlier expected the index to end the year at 4,850. UBS' view on the benchmark index is supported by growing bets of the U.S. Federal Reserve cutting interest rates this year, a decline in inflation and resilient earnings expectations. It also expects a 6.3% growth in earnings of S&P 500 companies this year, below consensus estimate of 11.4%. "While earnings should drive 2024 returns, falling interest rates should support incrementally higher multiples," UBS strategists said in a note. The index ended last year with an annual gain of more than 24%. It closed about 0.1% higher on Friday at 4,783.83 points. https://www.reuters.com/business/finance/ubs-lifts-2024-year-end-sp-500-target-5150-tops-big-banks-2024-01-16/

2024-01-16 09:02

FRANKFURT, Jan 16 (Reuters) - Euro zone consumers have slashed their inflation expectations, a European Central Bank survey showed on Tuesday, in comforting news for the ECB's efforts to contain prices. The Consumer Expectations Survey (CES) is used by policymakers to gauge whether households have faith in the ECB's ability to hit its 2% inflation goal, which may affect their wage demands and attitude towards saving and spending. The latest round of the poll, carried out in November, showed the median household expected prices to grow by 3.2% in the following 12 months, down from 4.0% a month earlier. Expectations for inflation three years ahead also came down: to 2.2% from 2.5%. This is likely to mirror a sharp fall in inflation in November as well as a contraction in lending as a result of the ECB's steep increases in interest rates. https://www.reuters.com/markets/europe/euro-zone-consumers-slash-inflation-expectations-ecb-survey-2024-01-16/

2024-01-16 07:16

LONDON, Jan 16 (Reuters) - The pound fell on Tuesday after data showed that growth in British wages slowed in the three months through November, supporting the idea that the Bank of England will cut interest rates sharply this year. Sterling was last down 0.37% at $1.2679, having traded around 0.3% lower at $1.2683 before the figures were released. Annual growth in earnings, excluding bonuses, came in at 6.6% in the September to November period, easing from a 7.2% rise in the three months through October. Including bonuses, pay growth slowed to 6.5% from 7.2% in the three months to October, well below economists' expectations of a 6.8% reading. The number of vacancies posted fell by 49,000 on the quarter in the October to December period, the Office for National Statistics said. The unemployment rate held steady at 4.2% in November. "Signs that the labour market is gradually normalising will reinforce the view that rate cuts could come as early as May," said Jake Finney, economist at PwC UK. The euro was 0.15% higher against the pound at 86.15 pence. Traders on Tuesday expected around 125 basis points of interest rate cuts from the Bank of England this year, up slightly from before the data. They see a roughly 93% chance of the first move lower coming in May, according to money market pricing. The pound has slipped around 0.5% against the dollar this year as stronger-than-expected U.S. economic and inflation data has boosted the U.S. currency. Sterling rallied 5.2% in 2023 as it recovered from a sharp drop the previous year and the UK economy performed better than expected. "Another big drop in wage growth in November supports our view that domestic inflationary pressures are fading fast," said Ashley Webb, UK economist at consultancy Capital Economics. "But the tightness of the labour market will probably mean that the Bank of England maintains its hawkish bias at its policy meeting in February." https://www.reuters.com/markets/currencies/sterling-falls-after-uk-wage-growth-slows-2024-01-16/

2024-01-16 07:11

Jan 16 (Reuters) - Swiss chocolate maker Lindt & Spruengli (LISN.S) on Tuesday said its 2023 sales grew by 10.3% organically and came in ahead of market expectations, boosted by higher product prices and strong sales of its pralines across markets. The maker of Lindor balls and gold foil-wrapped teddy bears attributed most of the sales growth to the increase in selling prices, which it used to offset higher raw material costs, especially for key ingredient cocoa. The chocolate industry is dealing with historically high cocoa prices. New York cocoa futures rose to a 46-year high last year and are expected to remain strong in 2024. Lindt said its overall sales reached 5.20 billion Swiss francs ($6.06 billion) in 2023, up 4.6% when accounting for currency exchange effects. This slightly beat analysts' average forecast of 5.18 billion francs, according to LSEG data. The company said that exchanging foreign currencies into Swiss francs had a negative impact of 4.4% on the sales. In the last twelve months, the Swiss franc has strengthened by roughly 8% against the U.S. dollar and by 5% against the euro, adding pressure on companies like Lindt that report in Swiss francs but get most of their revenue from North America and other European countries. Lindt said it expected to record an operating profit (EBIT) margin of around 15.5% for 2023 when it posts full annual results on March 5. For 2024, the Zurich-based chocolatier targets organic sales growth of 6% to 8%, and aims to increase its operating profit margin by 20-40 basis points. ($1 = 0.8587 Swiss francs) https://www.reuters.com/business/retail-consumer/chocolate-maker-lindt-spruengli-2023-sales-beat-expectations-2024-01-16/

2024-01-16 07:07

BERLIN, Jan 16 (Reuters) - German inflation rose in December to 3.8%, the federal statistics office said on Tuesday, confirming preliminary data. German consumer prices, harmonised to compare with other European Union countries, had risen by 2.3% year-on-year in November. The statistics office gives more details on its website. https://www.reuters.com/markets/europe/german-inflation-rises-38-december-2024-01-16/

2024-01-16 06:58

SINGAPORE, Jan 16 (Reuters) - Four tankers used for shipments of Qatari liquefied natural gas (LNG) have resumed course after pausing for several days amid maritime attacks by Yemen's Iran-aligned Houthis in the Red Sea, LSEG shiptracking data showed on Tuesday. The Houthi attacks, in what they call a bid to support Palestinians in the war with Israel, have disrupted trade on the main East-West route that makes up about 12% of global shipping traffic. On Monday, the Houthi movement vowed to widen its targets in the Red Sea region to U.S. ships, following U.S. and British strikes on its sites in Yemen. LNG tanker Al Rekayyat has resumed sailing through the Red Sea and is heading to Qatar, the data showed, after having been stopped since Jan. 13 along its Red Sea route. The vessels Al Ghariya, Al Huwaila and Al Nuaman, loaded with Qatari LNG, were also on the move, but had changed course to head south even though they are still signalling the Suez Canal as their destinations, the data showed. Qatari LNG cargoes transiting Suez are typically headed for Europe. The three tankers had stopped off the coast of Oman since Jan. 14. The estimated time of arrival for the Al Nuaman has also been delayed for more than two weeks to Feb. 4 from Jan. 19, the data showed. QatarEnergy did not immediately respond to requests for comment outside official business hours. Shipowners and managers of the four vessels, including Teekay Shipping Glasgow, Pronav Ship Management and Nakilat Shipping Qatar Ltd did not immediately respond to requests for comment. Shell (SHEL.L), which owns shipping and chartering arm STASCO, manager of the Al Nuaman, declined to comment. Vessels have been pausing or diverting from the Red Sea that leads to the Suez Canal, the fastest route for freight from Asia to Europe. LNG vessels are among the many ships forced to take the longer route around Africa via the Cape of Good Hope instead. Analysts estimate Cape of Good Hope route could add about nine days to the 18-day voyage from Qatar. A longer route would result in delivery delays, but gas storage levels in Europe are healthy. S&P estimates Qatari LNG cargoes through the canal at 14.8 million metric tons (MMt) a year, U.S. cargoes at 8.8 MMt and Russian ones at 3.7 MMt. Front-month European benchmark gas prices on the Dutch TTF hub eased on Monday, as milder weather forecasts and well-filled storage helped offset shipping concerns. QatarEnergy, the world's second largest LNG exporter, has stopped sending tankers via the Red Sea although production continues, a senior source with direct knowledge of the matter told Reuters on Monday. In 2023, Qatar exported more than 75 MMt of LNG, according to LSEG data, including 14 MMt to buyers in Europe and 56.4 MMt to Asia. https://www.reuters.com/markets/commodities/lng-tankers-carrying-qatari-lng-resume-course-data-shows-2024-01-16/