EUROPEAN OPEN: AKZA NA rejects Nippon Paint EUR 7.5bln offer for unit; BAS GY mulls ags IPO at EUR 20-30bln valuation; VOW3 GY favours cost cuts over plant closures; STLAM IM Q2 shipments seen rising 10%; FRE GY affirms FY26 guidance after govt reforms

EUROPEAN OPEN:

• European equities start the week on the back foot, as crude prices jump higher amid renewed tensions in the Middle East, after the US and Iran exchanged strikes over the weekend. 
• CENTCOM said the US launched strikes on Iran to curb attacks on shipping in the Strait of Hormuz, with Iranian media confirming strikes near Sirik, Bandar Abbas and Qeshm Island. Iran officials declared recent diplomacy futile, and targeted US facilities across Gulf states, while Qatar and the UAE also faced attacks. Iran said it has again closed the Strait of Hormuz, although some vessels continued crossing with transponders switched off.
• US 2yr yields rose to the highest since February 2025, and 10yr yields also gained, as the renewed tensions lifted Brent crude prices, stoking expectations of tighter Fed policy ahead to combat inflation. Gold and silver fell, as Treasury yields and the USD rose, other base metals also declined amid concerns about global growth and industrial commodity demand.
• The JPY weakened after Reuters reported Japan has no plans to overhaul GPIF's asset allocation; Japan could instead work within existing allowable ranges to direct more pension fund investment toward domestic assets.
• In UK fiscal-related news, incoming PM Andy Burnham is considering unveiling a bolstered budget later this year, with allies and experts lobbying for policies including a land tax, public control of utilities and a more ambitious devolution strategy, Bloomberg reports.
• And in French politics, Marine Le Pen’s first-round support rose to 34-35.5% in an Elabe poll (+3 points vs a March poll), following an appeals court ruling clearing her to run in the April 2027 presidential election.
• Elsewhere, the week ahead features key releases, including US CPI and testimony from new Fed Chair Warsh to lawmakers, which will set the tone ahead of the 29th July FOMC.

STOCK SPECIFICS:

• TECH: SK Hynix (SKHY) shares sharply fell overnight despite the chipmaker’s successful Nasdaq ADR debut last week, as investors shifted focus to near-term earnings concerns, and questions over the durability of the AI memory boom; elsewhere, CEO said 2027 will be the worst year in the memory industry’s history from a supply perspective, with customer demand expected to exceed production capacity beyond 2030.
• MATERIALS: Nippon Paint (4612 JT) submitted a EUR 7.5bln offer for Akzo Nobel’s (AKZA NA) decorative paints business, valuing the unit at approximately 12x 2026 EBITDA; Akzo’s management said the proposal significantly undervalues its decorative paints business and continues to recommend a merger with Axalta (AXTA). Nippon’s bid follows the collapse of a joint offer by Nippon and Sherwin-Williams (SHW) for the entirety of Akzo Nobel last month. Congo’s tax agency has reportedly shut down the offices of a Glencore (GLEN LN)-owned copper mine over alleged unpaid payments to the state. BASF (BAS GY) has now contained a nitric acid leak which shut down its main German plant on Saturday; elsewhere, BASF is reportedly considering a partial IPO of its agricultural business, targeting a valuation of between EUR 20-30bln, according to Handelsblatt.
• CONSUMER: Volkswagen (VOW3 GY) CEO Oliver Blume said “smarter solutions” exist other than closing factories, and highlighted 20% average cost reductions at German plants last year; he added that VW must continue cutting costs and streamline models. Stellantis (STLAM IM) estimates Q2 consolidated shipments +10% Y/Y at 1.6mln units. A group of Aston Martin (AML LN) creditors have reportedly offered to provide fresh financing, if needed, to block any alternative debt deal.
• HEALTHCARE: GSK (GSK LN) phase II AZUR-1 trial of Jemperli in patients with dMMR/MSI-H locally advanced rectal cancer met its primary objective, showing meaningful and sustained clinical complete response rate at 12 months. Novo Nordisk (NOVOB DC) Phase 3 FRONTIER4 interim data showed denecimig’s safety and efficacy were consistent across dosing regimens in 426 haemophilia A patients aged one year and older. Fresenius (FRE GY) affirmed its FY26 guidance following German lawmakers approval of healthcare reforms.
• FINANCIALS: Plus500 (PLUS LN) reported H1 2026 revenue of USD 462.9mln (+12% Y/Y, and vs prev. USD 415.1mln), EBITDA of USD 187.5mln (+1% Y/Y, vs prev. USD 185.1mln) and customer income of USD 460.8mln (+24% Y/Y, vs prev. USD 371.5mln), a five-year record high for the six-month period; it expects FY26 revenue and EBITDA in line with current market expectations.

DAY AHEAD:

• EVENTS: At least 25 leaders will meet in Paris on 13th July to strengthen support for Ukraine; the 37-country Coalition of the Willing will discuss air defence, Patriot missile production, an anti-ballistic system and security guarantees.
• DATA: The week’s data slate starts off on a quiet note; the US monthly budget statement for June will be released in the afternoon (prev. USD 293bln).
• CENTRAL BANKS: The ECB ESRB annual report for 2025 will be published. On the speakers’ slate, Fed’s Waller (voter) will speak on the economic outlook at the NYABE. Fed’s Bowman (voter) will give remarks on modernising financial regulation. BoE’s Pill (hawk) will speak on financial regulation, innovation and growth.
• SUPPLY: EU auctions EUR 6.0bln across 2029, 2033 and 2041 lines. This week, the UK will issue 2038 index-linked Gilts.
• ENERGY: OPEC Monthly Oil Market report is due today.
• WEEK AHEAD: Highlights include: US inflation and retail sales data, Fed Chair Warsh’s dual testimony to lawmakers, a BoC policy announcement, China activity data, UK GDP. US corporate earnings season begins, with big financials set to report this week. Notable corporates reporting this week include: JPMorgan (JPM), TSMC (TSM), ASML (ASML), Johnson & Johnson (JNJ), GE Aerospace (GE), UnitedHealth (UNH), Bank of America (BAC), Morgan Stanley (MS), Netflix (NFLX), Goldman Sachs (GS), Prologis (PLD), Progressive (PGR), Abbott (ABT), BlackRock (BLK), Wells Fargo (WFC), Travelers (TRV), United Airlines (UAL), Alcoa (AA).
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