EUROPEAN OPEN: LHA GY FY revenue misses, sees higher FY26 EBIT; ROG SW and ZEAL DC report positive Phase II results for obesity drug; IFX GY downgraded, AIR FP upgraded; US jobs data, lots of Fedspeak ahead

• EUROPEAN OPEN: European equities are opening on the front foot; on the week, futures of the broad Stoxx 600 are primed for losses following two weeks of upside, while the narrower Euro Stoxx 50 is on course for losses after gains last week. Stocks are generally rebounding at the end of a volatile week; the USD has recently weakened as the US makes efforts to ease the impact of an oil price surge. Oil is on course for its biggest weekly surge since 2022 as the Iran war disrupts energy markets, and shipping via the Strait of Hormuz is almost at a halt. Brent has risen almost 20% this week to above USD 85/bbl. Oil producer hedging desks have reported record trading volumes amid demand for protection against volatility; dealers said the week was among the busiest ever for hedging activity, with further records possible if elevated flows continue, Bloomberg reports. Ship traffic through the Strait of Hormuz has nearly halted amid the Middle East conflict, with transits falling to single-digit levels and only two confirmed commercial crossings in the past 24 hours, according to the Joint Maritime Information Centre. US Interior Secretary Burgum said the US is considering a range of measures to address rising oil and gasoline prices, adding that both immediate and longer-term options are under review; Bloomberg reported that the administration is not planning to have the Treasury trade oil futures to influence prices, however. Goldman Sachs said the oil market lacks confidence that US security measures to protect tankers in the Strait of Hormuz will resolve the disruption; the bank cited concerns about the practicality of naval escorts given the large number of vessels and questions over their effectiveness against drone attacks. Gold is headed for its first weekly decline in more than a month as a stronger USD and higher Tsy yields offset haven demand; the DXY has risen by over a percent this week for its biggest weekly gain since November 2024. Aluminium is heading for its biggest weekly gain since September 2024, with LME prices up more than 5% this week to the highest since 2022, as the Iran conflict disrupts shipments and tightens physical markets. In data, UK Halifax House Price Index rose 0.3% M/M in Feb (exp. 0.3%); average prices +1.3% Y/Y to GBP 301,151, the strongest annual growth in four months; the building society said the market has maintained early year momentum. The day ahead is packed with economic data releases and central bank speakers, including the US jobs data and retail sales, while a host of Fed speakers will deliver remarks today.
• STOCK SPECIFICS: In industrials, Maersk (MAERSKB DC) will temporarily suspend the FM1 service linking the Far East and Middle East and the ME11 service linking the Middle East and Europe following a risk assessment tied to the escalating conflict in the Gulf. Gulf shuttle services are also suspended, while the ME1 route will drop the Jebel Ali call and continue via India and Oman. Deutsche Lufthansa (LHA GY) reported FY25 revenue of EUR 39.6bln (exp. 39.8bln), net income EUR 1.34bln (vs 1.38bln Y/Y); said geopolitical developments, particularly the situation in the Middle East, have increased uncertainty around the outlook. Sees FY26 adj. EBIT and revenue above 2025 levels; it also said it is evaluating additional long-haul capacity to Asia and Africa as disruptions affecting Middle Eastern carriers reshape passenger flows and create opportunities for European operators. In tech, US officials are considering new rules for exporting AI chips that could require foreign countries to invest in US AI data centres or provide security guarantees to access large shipments, Reuters reports; the proposal would introduce licensing and monitoring requirements for chip exports and mark a shift from the Biden-era approach that largely exempted close US allies. Marvell Technology (MRVL) shares rose +15% in extended trading after the chipmaker reported better than expected quarterly results, supported by robust demand for its AI-related products. Atos (ATO FP) reported FY25 revenue EUR 8bln (exp. 8.03bln), meeting its target after cutting headcount 19% under its restructuring; core revenue fell 16.2% to EUR 6.96bln, Eviden sales +6.7% to EUR 1.04bln, helped by the Jupiter supercomputer; its backlog stood at EUR 10.7bln, and confirmed its outlook. In materials, Glencore (GLEN LN) has reportedly offered a USD 800mln upfront prepayment in exchange for future ferrochrome shipments from Eurasian Resources Group, which would help finance Shakhmurat Mutalip’s USD 1.4bln bid for a 40% stake in the miner, FT reports. In energy, Shell (SHEL LN) and the Venezuelan government have signed an agreement to boost offshore gas projects and explore onshore oil and gas. Petrobras (PBR) reported profit above estimates as strong oil production and record exports offset weaker crude prices. In communications, Universal Music Group (UMG NA) put plans for a US stock market listing on hold, citing market uncertainty and a valuation it considers too low; the move reverses an agreement with Pershing Square; UMG reported FY25 revenue +8.7% to EUR 12.5bln (exp. 12.3bln), adj. EBITDA +5.6% to EUR 2.81bln (exp. 2.8bln), and adj. net profit +7.0% to EUR 1.91bln. In healthcare, Roche (ROG SW) and Zealand Pharma (ZEAL DC) announced positive Phase II results for petrelintide, an amylin analogue developed for people living with overweight and obesity. China approved Pfizer’s (PFE) obesity drug ecnoglutide for chronic weight management in overweight or obese adults. In notable broker updates, Airbus (AIR FP) was upgraded at Citi; Holcim (HOLN SW) was upgraded at Citi; Keefe Bruyette upgraded BNP Paribas (BNP FP), Credit Agricole (ACA FP) and UBS (UBSG SW); Adecco (ADEN SW) was upgraded at UBS; ITV (ITV LN) was upgraded at Kepler; Norsk Hydro (NHO NO) was upgraded at DNB Markets; Infineon (IFX GY) was downgraded at UBS.

TODAY’S AGENDA:

• DAY AHEAD: The US February jobs data is the highlight (preview below), with the consensus looking for 59k from a prior 130k; the Bloomberg whisper number is 65k. US retail sales, released at the same time as the jobs data, is expected to show headline falling by -0.3 M/M in January. Elsewhere, a third look at Eurozone GDP in Q4 is expected to see the headline revised down to 1.3% Y/Y from 1.4%, while final employment change for Q4 is seen revised up to 0.7% Y/Y from 0.6%. Elsewhere, Business Inventories for December are due. Today’s speakers’ slate includes: Fed’s Daly (2027 voter, dove; no text expected, but there will be a Q&A), Fed’s Paulson (voter, dovish; text and Q&A expected), Fed’s Schmid (2028 voter, hawk; no text expected, but Q&A is), Fed’s Collins (2028 voter, neutral; text expected, but no Q&A), Fed’s Hammack (voter, hawk; text and Q&A expected); Fed’s Waller (voter, dove), Fed’s Goolsbee (2027 voter, dovish) and Fed’s Miran (voter, uber dove) will give TV interviews. From the ECB, President Lagarde and Cipollone are due. In energy, Baker Hughes will release its weekly rig count data. On today’s CRA slate, Scope will potentially review Germany (AAA), DBRS on Greece (BBB), Fitch on France (A+).
• PREVIEW - US JOBS REPORT (13:30GMT/08:30EST) - The February jobs report is expected to show 59k jobs added to the US economy in the month, down from 130k in January but slightly above the 50k breakeven estimate. Private payrolls are expected to rise by 65k versus the prior 172k. The unemployment rate is expected to remain unchanged at 4.3%, while wages are seen rising 0.3% M/M and 3.7% Y/Y. The data will be used to gauge Fed rate cut expectations, while some on the FOMC, including Waller, will use it to decide whether to vote for a rate cut or hold in March, although the Fed is expected to keep rates on hold barring any drastic change in the current situation or outlook. Recent proxies have been mixed: the ADP report was strong, while the ISM PMI employment sub-components showed improvement in both manufacturing and services, though manufacturing remained in contractionary territory. Initial jobless claims for the reference week were steady over comparable periods, while continuing claims rose slightly. The Conference Board reported a modest improvement in labour market perceptions. The Chicago Fed unemployment model expects the unemployment rate to remain at 4.3%. RevelioLabs reported 16.7k jobs lost in February versus 13.3k in January. Challenger layoffs fell notably.
• Click here for Newsquawk’s full US jobs data preview
• PREVIEW - US RETAIL SALES (13:30GMT/08:30EST) - The consensus looks for retail sales to decline by -0.3% M/M (prev. 0.0%). January retail sales data will be weighed against signs of resilient consumer spending at the start of the year. BofAʼs consumer checkpoint data showed total card spending rose 2.6% Y/Y in January, versus 1.8% Y/Y in its December report, marking the strongest pace in nearly two years despite weather-related disruptions. The bank flagged persistent income-based divergence in spending and wage growth, warning of a “K” shape between higher- and middle-income households, alongside the existing gap with lower-income groups. It said households were broadly adaptive and financially stable, navigating affordability pressures by trading down, maintaining elevated savings and drawing on available borrowing capacity. Higher tax refunds are also seen as a potential near-term support for consumer spending.