Speaker 1: Bloomberg Audio Studios, podcasts, radio News.
Speaker 2: The Stock Movers Report, your roundup of companies making moves
Speaker 2: in the stock market, harnessing the power of Bloomberg Data.
Speaker 3: Well, let's take a look at some stocks on the
Speaker 3: move today in Europe. I'm Stephen Carroll with Lizzie Burdon,
Speaker 3: and we're joined by Bloomberg reporter Chloe Malet.
Speaker 2: Chloe, good morning.
Speaker 3: Let's start with the big jump then in Ericson's shares.
Speaker 3: What's driving the games?
Speaker 1: Well, Ericson really delighted investors today with both a really
Speaker 1: big beat on earnings and then also its first ever buyback.
Speaker 1: So this is really good news for the company given
Speaker 1: that it has struggled a little bit recently, just like
Speaker 1: other makers of telecom equipment, and that is because demand
Speaker 1: has been very weak from operators. You did not spend
Speaker 1: as much on five G upgrades as expected and as
Speaker 1: needed by that industry, and so demand is still a
Speaker 1: little bit sluggish. But the earning stay from Ericson showed
Speaker 1: that its efforts to cut costs in this quite difficult
Speaker 1: telecoms market are paying off, and earlier this month it
Speaker 1: said that they would get rid of about thirteen percent
Speaker 1: of its staff in Sweden, which represents about sixteen hundred jobs,
Speaker 1: and there will be other jobs worldwide there will also
Speaker 1: be slashed this year. And now future growth is really
Speaker 1: going to be focused on the AI boom for Ericson
Speaker 1: because that technology really requires networks to be updated, and
Speaker 1: the CEO, for example, said that things like drones or
Speaker 1: the AI glasses that are being developed by Meta that
Speaker 1: creates a lot of strain on networks and therefore that
Speaker 1: needs to be updated. So AI is going to be
Speaker 1: a really big growth driver for Ericson and for its
Speaker 1: biggest rival, Nokia, which is a reporting next week as well,
Speaker 1: so we'll be watching if Nokia gets that that boost
Speaker 1: as well when it reports. Okay, and then meanwhile, the
Speaker 1: chemicals company BASF posting some losses, Chloe, are we seeing
Speaker 1: that reflected in markets? Yeah, So BSF fail this morning,
Speaker 1: and that is because it said that earnings had a
Speaker 1: dropped this year because of a drag from currency fluctuations
Speaker 1: and then also lower prices for its products. So this
Speaker 1: is really indictive of the long lasting downturn that we
Speaker 1: have seen in that chemical sector in Europe for a
Speaker 1: while now, and there's been essentially too much capacity and
Speaker 1: too little demand, and especially from the car making industry,
Speaker 1: which is one of the main customers for BSF. So
Speaker 1: that's one of the really big problems. Though of course
Speaker 1: that might get better if the auto industry recovers this year.
Speaker 1: And then the other thing that's been a drag is
Speaker 1: that energy costs have been really quite high in Europe
Speaker 1: and that's making it a lot more difficult for chemicals
Speaker 1: manufacturers in the region to compete with lower cost rivals
Speaker 1: from China, for example. So for BASF, those things have
Speaker 1: really dragged it down, but they are some good news,
Speaker 1: including the cash flow that is in pretty good shape
Speaker 1: and so that might meet a buyback and that usually
Speaker 1: gets investors a little bit more excited.
Speaker 3: Okay, looking next to Denmark, APMOL and MASKS shares down
Speaker 3: two point nine percent. What's happening?
Speaker 1: It was cut to an underperform rating by Bank of
Speaker 1: America analysts and analysts have called essentially what's happening structural
Speaker 1: overcapacity issues, which essentially means that they are now a
Speaker 1: lot of ships and perhaps maybe too little demand given
Speaker 1: those global trade tensions, and that overcapacity is going to
Speaker 1: become probably even more of a problem when the red
Speaker 1: Sea shipping route reopens, which had happened at some point
Speaker 1: this year, and Musk has already said that it had
Speaker 1: managed to complete a couple of successful passages through that
Speaker 1: route which has been closed for a while. And when
Speaker 1: that reopens, that means that ships don't have to take
Speaker 1: the long way around around the Cape of Good Hope
Speaker 1: in at the southern tip of Africa, and so that
Speaker 1: means that the higher rates that shipping companies have been
Speaker 1: able to ask for over the last couple of years
Speaker 1: are going to come down. And all of that that
Speaker 1: means lower earnings for Musk and so perhaps quite a
Speaker 1: tough year for that company.
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