• Market Round Up: Equity markets had a moderately positive day yesterday, with the S&P +0.77% and the Nasdaq +1.04%, the Stoxx 600 Europe ended the day up +0.23%. The main theme in the market yesterday was a rally in technology stocks after the previous day’s declines on fears of AI disruption, as Anthropic said it aimed to build partnerships with existing software businesses not to replace them. Consumer Discretionary had a good day as travel related firms (booking +5.1%, Expedia +5.1% and Royal Caribbean +4.6%) appear less exposed to AI disruption. President Trump gave his State of the Union address which reiterated his confidence in the economy and his strong belief in tariffs.   On the macro front, the data from regional Fed surveys was negative with the Philadelphia Fed Non-Manufacturing index down to -17.3 from 4.2 previously, the Richmond Fed Manufacturing index declined to -10 from -6, and the Dallas Fed Services index slipped to -3.2 from +2.7. On a brighter note, the Conference Board Consumer Confidence Index rose to 91.2 from 89 and beat expectations of 87.1. The ADP Weekly Employment data turned up slightly to 12.75K from 11.50k and House Prices were fairly stable MoM in December, though the positive change was less than November
• Day Ahead and Market Drivers: Equities: This morning Asian markets are generally higher, with China +0.60%, Tokyo +0.71% and Hong Kong +0.7%, as the market reacted to better sentiment out of the US on tech names. Japanese bonds weakened overnight as the PM appointed two candidates that favour stimulus to the board of the BoJ.    All eyes will be on Nvidia overnight, which is expected by our US team to beat and raise guidance on “exploding” AI demand. Salesforce and Snowflake are also reporting and should give some insights on AI impacts in software
• Stocks in focus: Glanbia (Overweight €18.70 +13.1% Upside) TP increase given solid end to FY25 and reaffirmed FY26 outlook. Diageo (Overweight PT 2190p +15.5% Upside) PT decrease given weaker than expected H1 results.
• Bonds: Bond markets had a very quiet day yesterday as they consolidated following the fall in yields on Monday with yields in the US and Germany unchanged. On the supply side, today we have issuance from Sweden, Italy and Germany in Europe and from Canada at the 10-year and the US at 2- and 5-year maturities. Today the ECB’s Vujcic is speaking, as well as the Fed’s Barkin (Neutral), Schmid (Hawkish), and Musalem (Hawkish).
• Commodities: Following a weak day yesterday in the oil markets, this morning WTI is trading higher by 0.79%, as Trump warned that Iran wants to rebuild its nuclear ambitions, whilst talks are still scheduled to continue in Geneva on Thursday. Gold has recovered half of yesterday’s -1.6% rising 0.8% this morning.

• Asset Allocation- Q1 2024.
• Focus Feature: Paper share certificates: What happens now?
• Analyst Conviction List: The investment case for our preferred names.
• The Fund Edit: Latest update on our range of investment funds, ETFs and trusts.
• Ethical Investing: Green Effects providing sustainable investment returns.
• Corporate Finance News: NewsWhip Media: Further Investment paves the way for continued growth.

Opportunities this week:

• Novo Nordisk (Overweight PT: DKK474 Upside 63%): Commentary relating to growth opportunities in the obesity drug market.
• Kingspan (Overweight PT €84.70 Upside 35%): Commentary on solid Q3 results and outlook. No further detail offered on ADVNSYS IPO.
• Uniphar (Overweight PT: €4.75 Upside 28%): Reaffirming positive outlook on the stock despite recent share price weakness.