AUTOMOTIVE: Week in Review

Feb-14 09:17
  • Spreads performed in line with the market at -2bp on average.
  • While Hon Hai confirmed  interest in Renault’s Nissan stake, it is seeking cooperation, not control. The Nissan-Honda merger was officially called off, while Nissan confirmed another dismal quarter.
  • Honda reported a small miss with margins pressured but confirmed FY guidance thanks to motorcycles.
  • Michelin results beat on FCF. It flagged a weak 1H for OEMs.
  • Leasys priced its issuance 5bp through our FV.
  • Ayvens supply came 3-5bp wide to our FV.
  • Ford priced its deal with just 3bp concession, despite teetering towards HY.

    Autos WIR 14

Historical bullets

US-EU: Dutch Govt Issues New Export Controls On Semiconductor Supply Chain

Jan-15 09:16

The government of the Netherlands said in a statement it has enacted new export controls on equipment used in the measuring and inspection of advanced semiconductors. The controls appear to apply to metrology and inspection systems manufactured by Dutch firm ASML - a crucial component in the supply chain of high-end chips. 

  • The announcement comes after sweeping new export controls, announced by the Biden administration this week, designed to curb the US' adversaries - including China and Russia - access to high-end semiconductor technology related to artificial intelligence. The measures include a three-tier licencing system with some US allies, including the Netherlands, permitted unfettered access to US chip markets and some countries, including China, hit with a near-total restriction on advanced US chips.  
  • The US measures are seen as a step to formalise a multilateral framework for controlling advanced chip technology before President-elect Donald Trump takes office next week.
  • The Dutch government said in a statement: "...the export of these technologies will now also require an export authorisation [to be] decide[d] on a case-by-case basis... [The measure applies to] all destinations outside the EU. It does not constitute an export ban."
  • Reuters notes that ASML said in a statement that it sees no additional impact from the measures, adding the rules are "in line" with changes indicated in December.
  • ASML noted in December that US restrictions apply to fabrication locations, "mainly in China" and reported measures "do not expect any direct material impact on our business."

EUROPEAN INFLATION: Broad-based Acceleration Of Spanish Inflation In December

Jan-15 09:07

Spanish December inflation confirmed flash estimates at 2.8% Y/Y, up from 2.4% in November.  All major sub-components other than processed foods accelerated on an annual basis, with core (ex-energy/unprocessed food) inflation ticking up to 2.6% Y/Y (vs 2.5% prior). 

  • Services inflation was 3.7% Y/Y (vs 3.5% prior). A 12.4% Y/Y rise in package holidays (vs 8.1% prior) was an important factor here, with the recreation and culture component at 3.9% Y/Y (vs 2.5% prior). More broadly, the December services PMI highlighted that services firms have been able to pass on input cost rises to consumers. 
  • Non-energy industrial goods inflation remained soft at 0.3% Y/Y (vs 0.2% prior). In contrast to services firms, the December manufacturing PMI highlighted that competitive pressures have limited pricing power amongst Spanish manufacturers.
  • Processed food inflation was 2.4% Y/Y (vs 2.5% prior), while unprocessed food inflation accelerated to 2.1% Y/Y (vs 0.8% prior).
  • Energy inflation was 5.5% Y/Y (vs 2.6% prior), driven by fuel prices. 

 

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GERMAN AUCTION PREVIEW: On offer next week

Jan-15 09:03

DFA has announced it will be looking to sell the following Green Bunds at its auction next Tuesday, January 21:

  • E1bln of the 2.10% Apr-29 Green Bobl (ISIN: DE000BU35025)
  • E1bln of the 2.30% Feb-33 Green Bund (ISIN: DE000BU3Z005)