EUROPEAN OPEN: GS raises Stoxx 600 PT; ENI IM & REP SM struggle to recover Venezuela payments; NESN SW recall; ABI BB to re-acquire stake in US metal container plants for USD 3bln; NXT LN lifts outlook

• EUROPEAN OPEN: European equities opened around flat/higher. Overnight, APAC stocks were mostly higher after a positive Wall Street handover, with major indices gaining as energy outperformed and yields softened in the prior session. Chinese stocks rose to multi-year highs, driven by optimism over AI progress and signs of economic recovery; the CSI 300 Index climbed to a four-year high, while the Shanghai Composite rose to the strongest level since 2015. Crude prices are in the red as traders focused on Venezuela, while global oversupply concerns continue to persist. Gold rose above USD 4,450/oz. Copper surged to fresh record highs, with three-month futures rising as much to almost USD 13,300/ton in London; traders cite tightening supply conditions as inventories were drawn into the US amid tariff concerns, as well as industrial action at Chilean mines. In data, French HICP rose to 0.90% Y/Y in December (exp. 0.80%, prev. -0.80%). The BRC said that UK food inflation rose for the first time since August, with prices up 3.3% Y/Y in December (vs 3% in November); the increase lifted overall shop price inflation to 0.7% (vs 0.6% in November), as falling non-food prices partly offset higher food costs. Non-food prices fell 0.6%. Retailers warned higher regulation, and a minimum wage rise in April, may keep inflation sticky in 2026. The Day Ahead includes German inflation metrics, final services and composite PMI data, Fed discount rate minutes, with speakers including Fed’s Barkin (2027 voter) and ECB’s Cipollone. In geopolitics, European allies and senior US envoys will meet in Paris to discuss security guarantees for Ukraine under US-brokered peace efforts with Russia; 35 countries will attend as leaders aim to align on ceasefire terms, responses to violations and possible deployment of a multinational reassurance force.
• STOCK SPECIFICS: Goldman Sachs raised its STOXX 600 price target to 625 (prev. 615) for the next 12 months; by sector, it upgraded Basic Resources and Financials, and downgraded Insurance and Food/Bev/Tobacco. In energy, ENI (ENI IM) and Repsol (REP SM) are struggling to recover about USD 6bln in gas and naphtha payments from Venezuela after US restrictions halted payments in crude last March, FT reports; the companies continue supplying gas, accumulating IOUs, and face limited support from US officials despite lobbying efforts. In tech, Nvidia (NVDA) CEO Huang said next-generation chips are in full production with up to five times more AI computing; he noted strong China H200 demand, and said Vera Rubin is set to debut later this year. In the UK, more than half of CFOs expect AI to boost company growth, according to a Deloitte survey; 59% believe AI will improve their firm’s performance, up from 39% in Q3 2024, signalling rising optimism about the technology’s economic impact. In consumer sectors, Nestle (NESN SW) is recalling a number of baby formula batches as a precautionary measure, citing toxin related risks which have been leading to nausea and vomiting. AB InBev (ABI BB) will re-acquire a 49.9% stake in its US metal container plants from a consortium led by Apollo (APO) in a deal valued at about USD 3bln; the seven facilities will be funded with cash on hand and are expected to close in Q1. In autos, UK new-car sales exceeded 2mln in 2025 for the first time since the pandemic, rising 3.5% to 2.02mln, according to the SMMT; automakers offered more than GBP 5bln in EV discounts, lifting electric sales about 25% to 23% market share, still below the 28% mandate. Pirelli (PIRC IM), shareholders, and the Italian government are seeking to end Sinochem’s 37% stake amid pressure ahead of a US ban on Chinese-backed car software and hardware taking effect in March, FT reports; Sinochem has appointed BNP Paribas to explore options, including a sale, as Rome considers using its golden powers. Next (NXT LN) reported Q4 full price sales were up +10.6% Y/Y (vs guidance for +7%), with UK sales up +5.9% and international sales up +38.3%; it raised FY PBT guidance to GBP 1.15bln (from GBP 1.135bln) and guided full price sales to GBP 5.60bln (from GBP 5.55bln). In industrials, Nordex (NDX1 GY) received orders from UKA totalling 224 MW for projects in Germany. Nexans (NEX FP) said that the Great Sea Interconnector project is going ahead in-line with the milestones defined since 2023; some rescheduling has occurred, but will not affect 2028 guidance. In financials, Prudential (PRU LN) launched a USD 1.2bln share buyback programme. In notable broker updates, Adidas (ADS GY) was downgraded at Bank of America; Diageo (DGE LN) was upgraded at RBC; Brenntag (BNR GY) was downgraded at Morgan Stanley.

TODAY'S AGENDA:

• DAY AHEAD: In geopolitics, European allies and senior US envoys will meet in Paris to discuss security guarantees for Ukraine under US-brokered peace efforts with Russia; 35 countries will attend as leaders aim to align on ceasefire terms, responses to violations and possible deployment of a multinational reassurance force. US Energy Secretary Wright plans to meet oil-industry executives this week to discuss reviving Venezuela’s energy sector, Bloomberg reports, without specifying a date. On the data front, final services and composite PMI data are due out of Europe, where no major revisions are expected. In the European morning, German states will release regional inflation metrics ahead of the national data later in the session; HICP is seen easing to 2.2% Y/Y from 2.6%, while CPI is expected to cool to 2.0% from 2.3%. The US Day sees the release of final composite and services PMI data, ahead of the ISM services data due Wednesday. The Fed will release discount rate minutes in afternoon trade. On the speakers' slate, Fed's Barkin (2027 voter; hawk) will speak on the outlook for policy and the economy; a text and Q&A are both expected. ECB's Cipollone (N/A) will speak on the international monetary system and international payments. On the supply front, Germany will sell EUR 6bln of 2027 Schatz. On the energy front, the API will release its gauge of weekly energy inventories after the close.