EU CONSUMER CYCLICALS: Kering; 1Q results (x3)
(KERFP; NR/BBB+ Stable)
So it is talking about two real estate transactions in the presser
this is not new and we already account for it (as do rating agencies)
It was levered to end last year net 3.3x pro-forma the above RE transactions. S&P threshold is 2.5-3.5x
It was guiding to more property disposals - it can use this or operating cash flows (FCF >€1b) to keep leverage stable
But our concern is where is the off-ramp is if weakness continues
It is family owned, CEO is son of the founder (who is 88)
Like Arnault they are the financiers of growth, not creatives (Gucci founded in early 1900's)
The family holds 42% of shares but 60% of voting rights
The Gucci creative director replacement already disappointed markets - it was a internal promotion
We will circle back tomorrow with complete thoughts
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ITALY T-BILL AUCTION PREVIEW: On offer this week
MEF has announced it will be looking to sell E7.0bln of the new 6-month Sep 30, 2025 BOT at its auction this Thursday, March 27.
US: Tariffs Will Keep Taxes Low - Trump
Wires carrying select comments from US President Donald Trump and other administration officials, speaking to reporters ahead of a Cabinet meeting at the White House. There is no live footage available of the meeting, likely reflecting a change in protocol following a slightly acrimonious Cabinet meeting earlier in the month.
- Trump says he, “will be announcing tariffs on autos, aluminum and pharmaceuticals in the very near future”. He adds that “tariffs will keep US taxes low”.
- Reuters notes that Trump said the United States, “would need all those products if there were problems including wars.”
- Trump reiterates that he hopes the Federal Reserve "lowers interest rates" - a regular message Trump has issued on his Truth Social account in recent days.
- Treasury Secretary Scott Bessent said: "Interest rates are going to keep declining as energy costs decline."
- Commerce Secretary Howard Lutnick notes that the, “April 2 tariff announcements will launch the 'external revenue service'” - a new agency Trump proposed in January to collect tariff revenue.
- Secretary of State Marco Rubio said: “Russia war has to end through negotiation.”
- Homeland Security Secretary Kristi Noem said: “Russia is using icebreakers in the Arctic to do surveillance on the US.”
- Elizabeth Troutman Mitchell at The Daily Signal reports from the room that EPA Administrator Lee Zeldin: “The partnership with DOGE, and Elon Musk has been incredible in the EPA. The team is very talented, we wouldn't be able to do it without them.”
LOOK AHEAD: Tuesday Data Calendar: House Prices/Build Permits, Regional Fed Data
- US Data/Speaker Calendar (prior, estimate)
- 25-Mar 08:30 Philadelphia Fed Non-Manufacturing Activity (-13.1, --)
- 25-Mar 0840 Fed Gov Kugler on economy & entrepreneurship (text, no Q&A)
- 25-Mar 0900 FHFA House Price Index MoM (0.4%, 0.3%)
- 25-Mar 0900 S&P CoreLogic CS 20-City MoM SA (0.52%, 0.40%)
- 25-Mar 0905 NY Fed Williams open remarks NY Fed (text, no Q&A)
- 25-Mar 1000 New Home Sales (657k, 680k), MoM (-10.5%, 3.5%)
- 25-Mar 1000 Conf. Board Consumer Confidence (98.3, 93.6)
- 25-Mar 1000 Richmond Fed Manufact. Index (6, 0)
- 25-Mar 1000 Richmond Fed Business Conditions (1, --)
- 25-Mar 1130 US Tsy $70B 6W bill auction
- 25-Mar 1300 US Tsy $69B 2Y Note auctions (91282CMV0)
- 25-Mar Building Permits (1456k, --), MoM (-1.2%, --)
