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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
CONSUMER CYCLICALS
- Auto earnings exploded into life this week, with fragility in the sector exposed. Autoliv’s concerns on the sector last week proved prescient. Michelin’s comments about “worrying tire overcapacity in Europe” was a sign of things to come at the start of the week. Naturally, spreads underperformed at +1.5 vs -1 for the index.
- Nissan posted near-zero EBIT margin; clearly an extreme example, but illustrative of how quickly things can move under competitive pressures.
- The Stellantis CEO described the industry as “in turmoil”; cash flow is under pressure across the board on both sides of the ledger with consumers under strain and high capex needs for the energy transition.
- Ford has been something of a darling recently with their ICE-for-longer strategy reaping profits; the stock had its biggest drop in 15 years with warranty costs hammering EBIT margins and FCF.
- GM fared much better with a beat & raise which saved its spreads but not the equity. Similarly Renault looked good from a credit perspective but the equity sold off on net income disappointment.
- Parts maker Schaeffler was hurt by BEV weakness, lowering guidance.
- Robert Bosch moved wider on its HVAC acquisition, which was bigger than expected. It does have levers to pull for financing, which helps contain the impact.
- BMW, Volkswagen, Daimler Truck, Toyota, Volkswagen, Aptiv, Pirelli report next week.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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