EU FINANCIALS: SEB Group (SEB Aa3/A+/AA) - Q4 Results
SEB Group (SEB Aa3/A+/AA) - Q4 Results
Overall marginally positive. Watch stage 3 loans and expenses growth going forward, but given the net income performance an upgrade from S&P may be on the cards. And upgrade from Moody's to Snr bonds could also follow tier 2 issuance.
• NII falls -2.1% QoQ and is -10.6% lower than Q4 23 at SEK 10,820mn. This is however around expectations and the group S&P's net income forecast of €34bn for 2024 which was a key point of their positive outlook.
• Fee & commission grew income by 18.1% vs Q4 2023, a good result even excluding the impact from AirPlus integration - a corporate payments provider.
• Expenses were SEK 2,409mn or 33.8% higher than Q4 23. Staff cost increases represented 40% of this and IT spending much of the rest. Expected, but investors would like to see this growth slow.
• Provisions were stable, but stage 3 loans jumped sharply. This was offset by a similar fall in stage 2 provisions, indicating that this was likely a one off, but we will watch this closely. - some of ...
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EQUITY TECHS: E-MINI S&P: (H5) Support Remains Exposed
- RES 4: 6194.19 1.236 proj of the Aug 5 - Sep 3 - Sep 9 price swing
- RES 3: 6178.75 High Dec 6 and key resistance
- RES 2: 6163.75 High Dec 16
- RES 1: 6107.50 High Dec 26
- PRICE: 6008.25 @ 07:24 GMT Dec 30
- SUP 1: 5965.00/5866.00 Low Dec 23 / 20
- SUP 2: 5811.65 38.2% retracement of the Aug 5 - Dec 6 bull leg
- SUP 3: 5784.00 Low Nov 4
- SUP 4: 5698.25 50.0% retracement of the Aug 5 - Dec 6 bull leg
A bear threat in the S&P E-Minis contract remains present and Friday’s move lower highlights the end of the recent Dec 20 - 26 corrective bounce. An extension lower would expose 5866.00, the Dec 20 low and a key short-term support. Clearance of this level would strengthen a bearish theme. Initial firm resistance to monitor is 6107.50, the Dec 26 high. A break of this level is required to expose key resistance at 6178.75, the Dec 6 high.
CROSS ASSET: Markets Pick Up Where They Left Off
Markets have generally picked up where they left off on Friday - although the US 10y yield has drifted off the closing high to trade back to 4.60%, a move that's likely keeping the USD pinned so far Monday, helping the likes of AUD/USD and NZD/USD to hold above the recent pullback lows.
- Equity futures remain lower across the board, with US index futures pointing to another lower open today to build on the softer Friday close. Meanwhile Bund futures are off the lowest levels, but remain perilously close to 132.71, the December low posted at the re-opening of trade after the weekend.
- Significant newsflow has been few and far between, with US domestic politics focusing on the internal Republican debate over H-1B visas and the passing of President Carter.
- Focus for the duration of Monday trade will be on the MNI Chicago PMI at 1445GMT, expected to tick up to 43.0 from 40.2 previously.
- We anticipate volumes and broader liquidity to remain very light over the coming two sessions, particularly with tomorrow's European market closures and early closes elsewhere. EUR futures are posting cumulative volumes ~30% below an already subdued average for this time of day.
BTP TECHS: (H5) Bears Remain In The Driver’s Seat
- RES 4: 123.34 High Dec 11 and key resistance
- RES 3: 122.85 High Dec 12
- RES 2: 121.94 High Dec 13
- RES 1: 120.70/121.14 High Dec 20 / 20-day EMA
- PRICE: 119.85 @ Close Dec 27
- SUP 1: 119.41 Low Dec 27
- SUP 2: 119.11 Low Nov 18
- SUP 3: 118.80 76.4% retracement of the Nov 7 - Dec 11 bull cycle
- SUP 4: 118.51 Low Nov 8
A corrective cycle in BTP futures has resulted in a pullback from its recent highs and Friday’s sell-off highlights and extension of the current bear cycle. The contract has recently breached the 20-day EMA and sights are on 118.80, a Fibonacci retracement point. Key resistance and the bull trigger has been defined at 123.34, the Dec 11 high. Initial firm resistance is seen at 121.14, the 20-day EMA.
