Head of Equity Strategy
Summary: This week's earnings will give exciting insights from Lennar on US housing, Zalando on European fashion e-commerce retailing, Volkswagen on their EV ramp-up, Pinduoduo on Chinese e-commerce, Nike on the US consumer and finally FedEx on rising logistics costs and to what extent they can continue to rise. But the week's highlight is definitely going to be Volkswagen as the market is becoming enthusiastic about it is ramp-up in electric vehicles and its ability to compete aggressively against Tesla.
The earnings season is light these days as we wait for the first quarter to end, but there are still some companies reporting but following and not following the ordinary calendar year. The list below shows the most important earnings releases this week with those marked in bold as those that could impact overall market sentiment or their specific industry.
Monday:KE Holdings
Tuesday: Partners Group, RWE, Ferguson, Crowdstrike, ZTO Express Cayman, Lennar, Coupa Software, Volkswagen, Zalando
Wednesday: Sunny Optical, Verbund, Alimentation Couche-Tard, Snam, Pinduoduo, Cintas
Thursday: CK Hutchison, China Feihe, CK Asset, CGN Power, Audi, Nike, Enel, FedEx, Accenture, Dollar General
Friday: China Mobile, Zijin Mining, Hong Kong & China Gas, Zhongsheng Group
This week we will focus on Volkswagen as the German carmaker is becoming a serious threat to Tesla and something the market is also beginning to price as we discussed in last Friday’s equity note. Volkswagen has held its first battery day today revealing a few things from signing a $14bn battery contract with Northvolt, the Sweden lithium-ion battery maker, and is planning to shift from pouch to prismatic battery cells which is a major boost to Samsung SDI and CATL, and mimics Tesla’s decision. Volkswagen is also announcing that it plans to have six battery factories in Europe by 2030 with a combined capacity of 240 GWh and plans to cut battery costs by 50%. The carmaker is also announcing a $400mn investment in charging infrastructure by 2025. Overall, Volkswagen has been reading their Nokia story well pursuing aggressively the future of cars to avoid a painful death. As Volkswagen rise to the occasion it will put pressure on Tesla which will have it most tough year in 2021 due to rising competition. In terms of its Q4 earnings tomorrow, Volkswagen is expected to post revenue of €65.7bn down 0.5% y/y and a sharp increase in profits to €4.6bn.
Other earnings releases worth mentioning are Lennar tomorrow for indications on the US housing market and Zalando which should have had another great quarter as e-commerce is still enjoying tailwind from the lockdowns. On Wednesday, Pinduoduo will hopefully report earnings after they postponed earnings last week and likely show robust results in line with other earnings from Chinese e-commerce companies. On Thursday, Nike will give insights on the US consumer and FedEx will update us on logistics costs and to what degree they can continue to rise and potentially squeeze profit margins for retailers including e-commerce retailers.
The market is trying to get back to the pre-Covid and pre-war times, but that model is broken. A new dawn is here and the financial world needs to adapt.
Steen Jakobsen,
Chief Investment Officer
A political switch in China towards less tough control of its people and companies may kick things back into gear.
Redmond Wong,
Market Strategist
While the economic situation in Europe may not be as bad as feared, there's still a plethora of things to fix.
Chris Dembik,
Head of Macroeconomic Research
As the world turns increasingly bipolar, equity markets face harsh times as they transition into the new reality.
Peter Garnry,
Head of Equity Strategy
New alliances and collaborations outside of China may lead to prosperous times in Asia.
Charu Chanana,
Market Strategist
For years, it was thought that the balanced portfolio was a thing of the past. But recent developments may have changed that.
Peter Siks,
Investment Coach
Following a dramatic and volatile 2022 with good returns, a lot of this year's commodity performance may be driven by Chinese politics.
Ole S. Hansen,
Head of Commodity Strategy
2023 could be a tough year for currencies but EUR and JPY may have some upside.
John J. Hardy,
Head of FX Strategy
The commodity-heavy Australian market may have a good start to 2023, as the Chinese focus on growth signals demand for Aussie resources.
Jessica Amir,
Market Strategist
From a near-perfect environment for speculative assets before 2022 to the opposite, crypto faces fundamental challenges.
Mads Eberhardt,
Cryptocurrency Analyst
Disclaimer
The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.
Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-gb/legal/disclaimer/saxo-disclaimer)
