• Market Round Up: Global equities experienced an aggressive sell-off yesterday as markets adjusted to an escalating war in the Middle East. The S&P500 fell 0.9%, the Nasdaq fell 1.0% whilst the Eurostoxx 600 dropped 3.1%.  The biggest downgrades on the day came from European Utilities (-4.3%) and Financials (-3.9%), whilst in the US both Best Buy (+7.1%) and Target (+6.7%) had a strong day as margin expansion and growth plans supported a positive outlook for both companies respectively.   On the macro side, preliminary European inflation for February came in higher than expected YoY at 1.9% (Est. 1.7%) with a MoM change from -0.6% to 0.7%.
• Day Ahead and Market Drivers: Equities: Asian equities have again started on the backfoot this morning with Japan down 3.7%, Hong Kong down 2.9% and China down 1.2%On the macro front today, we will get updates on US MBA Mortgage Applications for the week ended 27th February as well as the ADP Employment change for February. The ISM Services Index will also be published. In the UK we have the release of Services PMI data for February (Est. 53.9) whilst in Ireland the Unemployment rate for February will be updated. On the earnings side today we have FY25 results from both AIB and Cairn Homes. In the wider European market we have names like Adidas, Bayer AG, and Kerry’s peer, Symrise AG all reporting FY25 results. In the US, whilst the majority of names have now reported, the market will be keenly awaiting the results of Broadcom, who’s results will be published after market.
• Stocks in focus: Cairn Homes (Overweight PT €2.67, 18% upside) – FY2025 results commentary and PT upgrade from €2.46 to €2.67. AIB Group (Overweight, PT €10.00, c. 18% upside) – Post FY2025 results commentary and PT upgrade from €9.60 to €10.0
• Bonds: Global bond markets experienced a broad sell-off as the war in the Middle East is raising inflation fears and a reassessment of interest rate expectations. US Treasuries rose across the curve with the 10-year climbing to 4.06%. The German 10-Year Bund climbed 9bps to 2.79%. There is no major bond auction today.   From central bank speakers we have the ECB’s Muller, Cipollone, Villeroy and Guindos, whilst in the US the Fed will release its Beige Book
• Commodities:  Global bond markets experienced a broad sell-off as the war in the Middle East is raising inflation fears and a reassessment of interest rate expectations. US Treasuries rose across the curve with the 10-year climbing to 4.06%. The German 10-Year Bund climbed 9bps to 2.79%. There is no major bond auction today.   From central bank speakers we have the ECB’s Muller, Cipollone, Villeroy and Guindos, whilst in the US the Fed will release its Beige Book

Opportunities this week:

• L’Oreal (Hold PT: €415 Upside 7%): Lookahead to Q3 results (tomorrow) and partnership with Kering announced today.
• AIB Group (Overweight PT: €8.30 Upside 12.5%): Commentary on recent weakness in US regional banks and subsequent sell-off.
• Flutter (Overweight PT: $293 Upside 16%): Commentary on good growth prospects despite recent headwinds and weakness in share price.