WEBVTT - Schneider Electric Up, Mercedes Upgraded, STMicro Gains

0:00:02.520 --> 0:00:07.440
<v Speaker 1>Bloomberg Audio Studios, podcasts, radio News.

0:00:08.560 --> 0:00:12.440
<v Speaker 2>The Stock Movers Report, your roundup of companies making moves

0:00:12.480 --> 0:00:16.120
<v Speaker 2>in the stock market, harnessing the power of Bloomberg Data.

0:00:16.280 --> 0:00:17.919
<v Speaker 3>Let's take a look at some of the stocks on

0:00:17.960 --> 0:00:20.400
<v Speaker 3>the move today. Then in Europe, I'm Caroline Hepgar with

0:00:20.520 --> 0:00:23.560
<v Speaker 3>Valerie Title and we're joined by Binberg reporter Chloe Malay.

0:00:23.640 --> 0:00:24.279
<v Speaker 4>Good morning.

0:00:24.920 --> 0:00:30.200
<v Speaker 3>So automation and robotics in focus. Firstly, Schneider Electric. There's

0:00:30.240 --> 0:00:33.600
<v Speaker 3>been a bullish view from JP Morgan. Does the market

0:00:33.680 --> 0:00:35.960
<v Speaker 3>agree It seems like they do so.

0:00:36.120 --> 0:00:38.519
<v Speaker 5>Schneider Electric shares were up this morning, as well as

0:00:38.520 --> 0:00:41.879
<v Speaker 5>Semen's Energy, so both of those companies were upgraded by

0:00:41.960 --> 0:00:44.720
<v Speaker 5>JP Morgan analysts, with those analysts saying that they have

0:00:44.760 --> 0:00:48.080
<v Speaker 5>a really bullish view on the European capital goods sector

0:00:48.159 --> 0:00:50.920
<v Speaker 5>going into twenty twenty six. They said that the sector

0:00:51.040 --> 0:00:53.400
<v Speaker 5>setup is the best that it has been for quite

0:00:53.440 --> 0:00:56.840
<v Speaker 5>a few years, and that is thanks to the sector's

0:00:56.880 --> 0:00:59.560
<v Speaker 5>exposure to areas where there's a lot of momentum. So

0:00:59.600 --> 0:01:02.920
<v Speaker 5>of course we're thinking about a power generation grid, expansion

0:01:03.400 --> 0:01:07.640
<v Speaker 5>data centers. Of course, with this AI story that is continuing,

0:01:08.120 --> 0:01:11.720
<v Speaker 5>there's also improvement in European PMIS, and so that's also

0:01:11.760 --> 0:01:16.119
<v Speaker 5>helping out higher metal prices and improving outlook in China.

0:01:16.480 --> 0:01:18.840
<v Speaker 5>Also the boost from the German fiscal stimulus that is

0:01:18.880 --> 0:01:21.040
<v Speaker 5>going to come through next year, so all of those

0:01:21.040 --> 0:01:24.360
<v Speaker 5>factors are essentially reunited for a good twenty twenty six

0:01:24.600 --> 0:01:27.800
<v Speaker 5>for that sector, and Schneider Electric and Semen's Energy are

0:01:27.840 --> 0:01:29.200
<v Speaker 5>set to be better fitling from that.

0:01:29.560 --> 0:01:33.080
<v Speaker 4>In particular, Semen's Energy, the expectator.

0:01:32.600 --> 0:01:35.920
<v Speaker 5>Of the particularly high Daena list said that the earnings

0:01:35.959 --> 0:01:38.720
<v Speaker 5>growth is casting shade on the rest of the coverage.

0:01:39.400 --> 0:01:43.319
<v Speaker 5>So there's also good freak cash flow potential through to

0:01:43.360 --> 0:01:45.640
<v Speaker 5>the twenty forties. So it is quite the price for

0:01:45.640 --> 0:01:49.280
<v Speaker 5>Semen's Energy and therefore we're seeing those two companies rising

0:01:49.320 --> 0:01:49.800
<v Speaker 5>this morning.

0:01:49.920 --> 0:01:51.520
<v Speaker 1>Well, let's shift to the auto sector because in the

0:01:51.600 --> 0:01:54.400
<v Speaker 1>US session yesterday some of these autos were flying on

0:01:54.480 --> 0:01:57.320
<v Speaker 1>the back of some helps around deregulation when it comes

0:01:57.360 --> 0:02:00.320
<v Speaker 1>to Trump administration. We're seeing a positive session here in

0:02:00.360 --> 0:02:02.840
<v Speaker 1>Europe today, Mercedes on the back of an upgrade.

0:02:03.000 --> 0:02:07.120
<v Speaker 5>Yeah, Mercedes also and also Porsie were always at Bank

0:02:07.160 --> 0:02:10.040
<v Speaker 5>of America, so there's really a vote of confidence in

0:02:10.080 --> 0:02:12.600
<v Speaker 5>that car making sector after what has been quite a

0:02:12.600 --> 0:02:13.280
<v Speaker 5>few setbacks.

0:02:13.280 --> 0:02:14.000
<v Speaker 4>Of course this year.

0:02:14.040 --> 0:02:16.680
<v Speaker 5>We had of course US tariffs that are really weighing

0:02:16.720 --> 0:02:20.640
<v Speaker 5>on that industry, but also really continued competition in China

0:02:20.760 --> 0:02:24.360
<v Speaker 5>where those European car makers are really struggling to maintain

0:02:24.440 --> 0:02:29.000
<v Speaker 5>market share against Chinese manufacturers, and then also slow down

0:02:29.040 --> 0:02:31.440
<v Speaker 5>in the electric vehicle market. So there were a lot

0:02:31.480 --> 0:02:34.320
<v Speaker 5>of different challenges for that industry this year. But it

0:02:34.320 --> 0:02:37.320
<v Speaker 5>seems that things might be turning around for the sect

0:02:37.360 --> 0:02:39.600
<v Speaker 5>and as you mentioned, we have those news of deregulation

0:02:39.880 --> 0:02:42.600
<v Speaker 5>boosting those stocks as well. We've also now got more

0:02:42.600 --> 0:02:46.080
<v Speaker 5>clarity on tariffs. We also have signs that ev demand

0:02:46.320 --> 0:02:50.000
<v Speaker 5>for affordable models specifically is also picking up in Europe,

0:02:50.120 --> 0:02:53.560
<v Speaker 5>so it seems to be doing better. The main problem

0:02:53.560 --> 0:02:55.480
<v Speaker 5>that we're going to have next year for that sector

0:02:55.600 --> 0:02:58.440
<v Speaker 5>is going to be those competitive pressures in China that

0:02:58.480 --> 0:03:01.960
<v Speaker 5>are expected to steal be there and city analysts. Just

0:03:02.040 --> 0:03:05.080
<v Speaker 5>yesterday I actually cut some earnings estimates for BMW and

0:03:05.120 --> 0:03:08.560
<v Speaker 5>Mercedes in particular because of that continued weakness in China.

0:03:08.600 --> 0:03:11.000
<v Speaker 4>So there's just one negative spot there.

0:03:11.840 --> 0:03:15.640
<v Speaker 3>Okay. We're keeping it on on what's going on in

0:03:15.639 --> 0:03:20.560
<v Speaker 3>European stocks and especially positive EU stocks st Micro. What

0:03:20.760 --> 0:03:22.679
<v Speaker 3>is driving that progress?

0:03:23.320 --> 0:03:25.800
<v Speaker 5>So sc Micro, but also other kind of chip names

0:03:25.840 --> 0:03:28.960
<v Speaker 5>like ASM, etc. Up this morning on this kind of

0:03:29.040 --> 0:03:32.200
<v Speaker 5>optimism around the AI trade at the moment. We had

0:03:32.320 --> 0:03:35.840
<v Speaker 5>that going on as well yesterday with some upbeat commentary

0:03:35.880 --> 0:03:39.720
<v Speaker 5>bullish commentary from companies like Marvel and Microchip. We also

0:03:39.760 --> 0:03:42.760
<v Speaker 5>have some read across today from a camera con saying

0:03:42.760 --> 0:03:45.280
<v Speaker 5>that it will triple the production of AI chips in

0:03:45.320 --> 0:03:46.200
<v Speaker 5>twenty twenty six.

0:03:46.280 --> 0:03:48.160
<v Speaker 4>So those chip stocks in Europe have.

0:03:48.120 --> 0:03:50.400
<v Speaker 5>Gone kind of up and down throughout the last few

0:03:50.440 --> 0:03:52.840
<v Speaker 5>weeks as fears of an AI bubble kind of come

0:03:52.880 --> 0:03:55.600
<v Speaker 5>back and retreat and then resurface again. But right now

0:03:55.600 --> 0:03:58.760
<v Speaker 5>there seems to be actually quite positive as sentiment. Perhaps

0:03:58.800 --> 0:04:00.960
<v Speaker 5>it's only a matter of time for the market starts

0:04:01.000 --> 0:04:03.480
<v Speaker 5>to worry again about how much money is being spent

0:04:03.560 --> 0:04:06.080
<v Speaker 5>on those AI investments, but for now it's quite a

0:04:06.120 --> 0:04:09.120
<v Speaker 5>bullish positive view and st micro is benefiting from that.

0:04:09.960 --> 0:04:14.000
<v Speaker 2>The Stock Moover's report from Bloomberg Radio. Check back with

0:04:14.080 --> 0:04:16.640
<v Speaker 2>us throughout the day for the latest roundup of companies

0:04:16.720 --> 0:04:19.840
<v Speaker 2>making news on Wall Street and for the latest market

0:04:19.839 --> 0:04:24.320
<v Speaker 2>moving headlines. Listen to Bloomberg Radio Live. Catch us on YouTube,

0:04:24.400 --> 0:04:27.919
<v Speaker 2>Bloomberg dot com, and on Applecarplay and Android Auto with

0:04:27.960 --> 0:04:29.480
<v Speaker 2>the Bloomberg Business App.