EUROPEAN OPEN: AZN LN tozorakimab meets Phase 3 COPD endpoint; EVOK LN confirms BALY offer talks; WCH GY beat-and-raise; UCG IM says CBK GY needs deep changes; Norway SWF backs BP/ LN Chair

• EUROPEAN OPEN: European equities have started the week on the back foot amid renewed US-Iran tensions, which have rattled sentiment; Iran announced the re-closure of the Strait of Hormuz, there were reported Iranian attacks on several vessels, and President Trump said the US Navy had intercepted an Iranian-flagged ship, blowing a hole in its engine room after it tried to breach the US blockade. APAC shares largely shrugged off the escalation overnight, though traders are bracing for a volatile start to the week as uncertainty around Hormuz returns and US-Iran talks, now set to continue on Tuesday. Oil jumped as risk appetite deteriorated, with Brent climbing back above USD 95/bbl, reversing most of Friday’s decline after the waterway’s brief reopening. European natgas prices also rose, with benchmark TTF futures moving back above EUR 43/MWh as Iran shut the Strait again. US Treasury yields pushed higher overnight as some of Friday’s risk-on rally unwound, while fixed income traders also looked ahead to Kevin Warsh’s confirmation hearing on Tuesday as the next major catalyst for Treasuries. Gold and silver fell as the renewed disruption in Hormuz stoked inflation concerns tied to an energy supply shock and cast further doubt over efforts to end the conflict, with bullion slipping below USD 4,800/oz. Copper retreated from its highest close since early February. Iron ore bucked the broader tone and rose overnight, with reports noting that Chinese demand remained firm ahead of the May Day holidays, and near-term supply stayed tight. In Europe, German Chancellor Merz said he will soon convene Germany’s national security council to discuss the global energy crisis and its implications for Europe’s largest economy, adding that the body can act immediately if needed to protect energy security. German March PPI rose 2.5% M/M (exp. 1.4%), lifting the annual rate to -0.2% Y/Y (from -3.3%). In the UK, some ministers publicly backed PM Starmer over the weekend as calls for his resignation intensified over the Peter Mandelson affair. In data, Rightmove said UK house prices fell 0.9% Y/Y (prev. -0.2% Y/Y), citing higher mortgage rates linked to global uncertainty as a constraint on buyer affordability and seller pricing.
• STOCK SPECIFICS: In communications, Meta Platforms (META) plans a first wave of layoffs on 20th May that will cut about 10% of its workforce, and further layoffs are planned for later in 2026 as the company pursues AI-driven efficiency. In tech, Alphabet’s Google (GOOG) is reportedly in talks with Marvell Technology (MRVL) to develop two new AI chips; one would be a memory processing unit designed to work with Google’s TPU, while the other would be a new TPU built specifically to run AI models more efficiently. In healthcare, Eli Lilly (LLY) is in advanced talks to acquire Kelonia Therapeutics for more than USD 2bln, WSJ reports; a deal could be announced as soon as Monday and may include additional consideration if Kelonia meets certain milestones. Sanofi (SAN FP) said Nuvaxovid showed statistically significantly lower systemic reactogenicity than Moderna’s (MRNA) mNEXSPIKE in the US COMPARE study, with fewer overall and moderate-to-severe systemic and local reactions. AstraZeneca (AZN LN) said tozorakimab met the primary endpoint in the Phase III MIRANDA trial, reducing the annualised rate of moderate-to-severe COPD exacerbations in former smokers and the overall population; separately, its Alexion Pharmaceuticals unit has been granted US FDA orphan drug designation for palacaparib for the treatment of malignant glioma. GSK (GSK LN) said China approved Blenrep for 2L+ relapsed or refractory multiple myeloma, with the combination reducing death risk by 42% and nearly tripling median progression-free survival. In industrials, QXO (QCO) agreed to acquire TopBuild (BLD) in a cash-and-stock deal worth about USD 17bln, valuing shares at USD 505, with closing expected in Q3 2026; the deal would make the group the second-largest publicly traded building products distributor in North America. Siemens (SIE GY) said it will prioritise industrial AI investment in the US and China if EU rules are not eased, with most of its EUR 1bln investment set for the US. American Airlines (AAL) said it is not engaged in or interested in merger discussions with United Airlines (UAL), adding that such a combination would be negative for competition and consumers. In materials, Wacker Chemie (WCH GY) reported Q1 sales of EUR 1.41bln and EBITDA of EUR 173mln, both above expectations, and raised FY sales growth guidance to high single digits while maintaining EBITDA guidance. In energy, Eni (ENI IM) announced a new gas discovery in the Kutei Basin, offshore Indonesia; prelim estimates indicate in-place resources of approximately 5Tcf of gas, and 300mln bbls of condensate in the encountered interval. Norway’s sovereign wealth fund will back BP (BP/ LN) chairman Albert Manifold’s re-election, and support withdrawing two earlier climate reporting resolutions at the 23rd April AGM. In financials, UniCredit (UCG IM) said Commerzbank (CBK GY) needs deep changes, describing it as operationally underperforming, overvalued against fundamentals and burdened by structural weaknesses masked by favourable conditions. Chancellor Reeves will meet executives from Barclays (BARC LN), HSBC (HSBA LN), NatWest (NWG LN) and Santander (SAN SM) on Wednesday as the Iran crisis weighs on the British economy; the talks are expected to cover banks’ support for customers facing inflationary pressure from the crisis. Plus 500 (PLUS LN) reported Q1 revenue and EBITDA both rose Y/Y, and said FY26 revenue and EBITDA should exceed current market expectations. In consumer sectors, Evoke (EVOK LN) confirmed discussions with Bally’s (BALY) Intralot on a possible GBP 0.50/shr offer, combining shares with a partial cash alternative, with a firm offer deadline of 18th May. The FDA renewed modified risk tobacco product orders for Philip Morris’s (PM) IQOS devices and HEETS, allowing continued reduced-exposure communications to US tobacco users aged 21 and over. In notable broker updates, Barclays upgraded Commerzbank (CBK GY), Julius Baer (BAER SW), UBS (UBSG SW), and downgraded Deutsche Bank (DBK GY); Barclays downgraded Subsea 7 (SUBC NO) and Saipem (SPM IM), upgraded Technip Energies (TE FP); BBVA (BBVA SM) was downgraded at UBS; AB SKF (SKFB SS) was downgraded at RBC; Sanofi (SAN FP) was downgraded at BNP Paribas; Neste (NESTE FH) was upgraded at Inderes.

TODAY’S AGENDA:

• DAY AHEAD: On the data front, Eurozone construction output stats for February, Canada inflation metrics for March (headline seen rising to 2.5% Y/Y from 1.8%). Speakers include ECB President Lagarde (text expected), and Riksbank’s Thedeen. Notable US earnings due today include: Steel Dynamics (STLD), Zions Bancorporation (ZION), Cleveland-Cliffs (CLF).
• WEEK AHEAD: Highlights include US-Iran talks, Warsh hearing, flash PMIs, US retail sales, UK jobs data, inflation readings from Japan, UK, NZ and Canada; earnings season will pick-up, with notable corporates reporting this week including: TSLA, UNH, ISRG, BA, LRCX, PM, IBM, INTC, AXP.
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