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Consumer / Healthcare / Airlines: Week in Review

CREDIT UPDATE

Retailers (+2) underperformed F&B names (~unch) while Airlines pared back recent outperformance with broad based weakness outside EasyJet. Main events across the sectors for us were (notes linked);

Two points of interest for us was 1) strong performance from L'Oreal's curve (Aa1, AA; S) - were not sure if this was investors moving up the ladder from Kering. The two are spread 20bps at the 5yr now with Kering (in our view) giving enough discount for near term downside risk. L'Oreal equities ended -2.5% on the week vs. Kering -14%.

Second was firming our view on ATDBCN € lines post-earnings. We'd caution our view that it screens cheap with the caveat that potential M&A supply may be down the road (based on company guidance) giving investors who are willing to wait a potential better entry.

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