Ahead of the US PPI, European bond yields (except the UK) were already lower after opening slightly up. The US 30yr was still above 5%. The 30yr JGB remains highly volatile, falling -10bp overnight after rising significantly earlier this week. Despite budget-related political concerns in France we do not see any widening of spreads to Bund. French Prime Minister Bayrou unveiled €43.8 in spending cuts, including proposals to scrap two public holidays. The proposal will likely face another no confidence vote…
In the UK yields are higher after a higher-than-expected June inflation print. The UK CPI rose to 3.6% yoy – Highest since January 2024 in June exceeding market expectations for an unchanged CPI at 3.4%. The core CPI increased to 3.7% yoy from 3.5% also ahead of expectations of 3.5% (Highest since April). The CPIF increased to 4.1% from 4% (also at the highest since January 2024) and the RPI (Retail price Index) rose to 4.4% from 4.3%, Highest since April. Both also exceed expectations. The increase in core inflation comes even as services inflation is unchanged as non-energy industrial goods inflation increased to 1.8% from 1.6%. Energy inflation increased to -0.6% yoy from -1.7% on higher liquid fuel inflation. Food inflation rose to 4.45% from 4.15%: unprocessed food inflation reached 3.7%, up from 3.2%. As for many other continental European countries we see noticeable increase in beef price inflation (20.4% yoy up from 17 in May/ Alcoholic beverages inflation contributed to higher inflation, increasing to 5% from 3.3% yoy in May. Non-alcoholic beverages inflation eased to 5.7% from 6.6%. Within Services, railways and air transport services, auto insurance and cultural services saw an increase in inflation from May’s level. It was compensated by lower inflation for rent, accommodation, social protection and recreational services.
UK bond yields increased on the back of the inflation data, but the BoE is still expected to ease in August
The Italian CPI is confirmed at 1.7% up from 1.6% in May but the HICP is revised upwards to 1.8% from 1.7%, increasing from 1.7% yoy for the previous month. The core CPI is revised down to 2% from 2.1%. still up from 1.9% yoy in May. Unprocessed food inflation and beverages inflation were the main driver for the increase in inflation. As for the UK and many other countries, beef & veal inflation increased again (5.7% from 5.2%). The inflation of the Dairy price is also higher. Services inflation is confirmed to be at 2.7% yoy up from 2.6% yoy in May with only minor revisions from the details provided by the preliminary release.
Plenty of comments on the next possible Fed Chair. Hasset or Warsh should lead to greater concerns for the Fed independence, while Waller also points to a more dovish chair as well. Steeper curves ahead. The PPI is a positive, but the CPI started to show tariffs inflation percolating into inflation.
The ECB balance sheet update is not adding much, with small changes on the asset side and a greater increase in liabilities in € to non- Eurozone residents, leading to a -€10.5bn decrease in excess liquidity for the week. Base money declined by -€9.05bn w/w. Banknotes in circulation increased by +€1.5bn w/w to 1,589bn (at ~10.6% of GDP). Excess liquidity is still at 17.7% as of July 14, versus 14.4% pre pandemic response and just 2.3% in early 2015!
On the companies’ front: ASML's Q2 results came in at the top end of guidance, but the company poured cold water on investor sentiment by stating that, due to increasing macroeconomic uncertainties, 'while we still prepare for growth in 2026, we cannot confirm it at this stage”. Renault pre-announced H1 results and a FY2025 guidance cut. Sales volumes failed to meet expectations, with Renault citing increasing market and competitive pressures as well as an underperforming light commercial vehicle (LCV) segment in a contracting European market. Handelsbanken reported lower-than-expected revenues for the second quarter, with operating profit also coming in below forecasts. The bank's trading result was significantly weaker than anticipated. Stellantis today announced its decision to discontinue its hydrogen fuel cell technology development program in partnership with Michelin and Forvia. Due to limited availability of hydrogen refueling infrastructure, high capital requirements, and the need for stronger consumer purchasing incentives, the Company does not anticipate the adoption of hydrogen-powered light commercial vehicles before the end of the decade. Sandvik reported second-quarter revenue in line with expectations, but its adjusted EBITA result came nearly below forecasts on strong FX headwinds. Rock Processing recorded stable demand in the mining sector, while the infrastructure market remained subdued. Richemont reported Group sales at € 5.4 billion, up by 6% at constant exchange rates and by 3% at actual exchange rates driven by continued strength at Jewellery Maisons, up by 11% at constant exchange rates. More details on equities here
French Budget: PM Bayrou proposes to scrap two public holidays...
“Tous au Boulot”: “EVERYONE BACK TO WORK”
Volatile JGB 30yr bonds (-10bp overnight after a sharp increase in yields in the previous days). US 30 yr yield went down slightly from yesterday’s level but still above 5%
No movement OAT/BUND Spreads despite budget issues.
The Latest balance sheet update (ECB Release) shows only a slight decline in Securities held for monetary policy purposes (-€3bn) for the week (ending July 11), and as known we had a -€1.4bn decline in MRO borrowing to €6.58bn (back up to €7.16bn thus current week). Total assets declined by -€4.2bn week-over week.
On the liabilities side we had a +€14.1bn increase in Liabilities to non-Euro Area residents in € (item 6), withdrawing liquidity, but partially compensated by a decline in the General Government Account of -€5.75bn w/w bringing the GGA below €100bn again (€95.4bn). Both the item 6 and GGA remain at low level.
It ended up in a -€10.5bn decrease in excess liquidity for the week and base money declined by -€9.05bn w/w. banknotes in circulation increased by +€1.5bn w/w to 1,589bn (~10.6% of GDP).
At the end the Excess liquidity is still at 17.7% as of July 14, versus 14.4% pre pandemic response and just 2.3% in early 2015!
The UK inflation rose to 3.6% yoy – Highest since January 2024 in June exceeding market expectations for an unchanged CPI at 3.4%. The core CPI increased to 3.7% yoy from 3.5% also ahead of expectations of 3.5% (Highest since April). The CPIF increased to 4.1% from 4% (also at the highest since January 2024) and the RPI (Retail price Index) rose to 4.4% from 4.3%, Highest since April. Both also exceed expectations. The increase in core inflation comes even as services inflation is unchanged as non-energy industrial goods inflation increased to 1.8% from 1.6%.
Energy inflation increased (less negative) to -0.6% yoy from -1.7% on higher liquid fuel inflation. Food inflation rose to 4.45% from 4.15%. Within food, unprocessed food inflation reached 3.7% up from 3.2%. As for many other continental European countries we see noticeable increase in beef price inflation (20.4% yoy up from 17 in May). Inflation also increased for fresh fish (4% vs 2.3%), cheese (5.2%vs 4.9%) and butter (20% up from 18.2%). Alcoholic beverages inflation contributed to higher inflation, increasing to 5% from 3.3% yoy in May. Non-alcoholic beverages inflation eased to 5.7% from 6.6%. Within Services, railways and air transport services, auto insurance and cultural services saw an increase in inflation from May’s level. It was compensated by lower inflation for rent, accommodation, social protection and recreational services.
Energy Inflation is up in June at -0.6% yoy versus -1.7% yoy in May with prices down -0.2m/m but against low comparison from June 2024 (-1.2% m/m). Electricity inflation was stable at 4.6%yoy (0%m/m), and gas inflation increased only marginally (12.3% vs 12.2%, 0.1% m/m) but we see steeper increase of inflation liquid fuels to -16.5% from -19.5% in May with low comparison (-5.5% m/m in June 2024). Diesel inflation increased to -8.6% yoy vs -11% in May and gasoline at -9.5% vs -11%).
Food inflation increased to 4.45% yoy from 4.15% in May with increase in unprocessed food inflation to 3.7% yoy from 3.2% yoy in May, up 0.3% m/m. Processed food inflation & non-alcoholic beverage inflation declined to 5.2% from 5.3% on lower alcoholic beverages inflation.
Withing fresh food, fresh vegetable prices decreased 2% yoy, down from 2.4% yoy and fresh fruit inflation is marginally higher at 2.8% from 2.7%. Meat inflation increased significantly to 5.7% from 4.8% with beef prices increasing 20.4% yoy vs 17% yoy in May (3% m/m). Eggs inflation is stable at 3.3%, whole milk inflation increased to 8.4% from 5.9%yoy in May and we see higher inflation for cheese (5.2% vs 4.9% and butter (20% vs 18.2%). Fresh fish inflation also increased to 4% from 2.7%. Other bakery products (cake) inflation increased to 8.3% from 5.9% as well. Oil & fats inflation is up to 5.1% from 3.8%.
Non-alcoholic beverages inflation fell in June to 5.7% from 6.6% in May with a decline in cocoa-based drinks inflation (9.5% vs 10.1%) and coffee inflation (12.3% vs 13.9%). Inflation is also lower for tea (0.6% yoy vs 1.25%), soft drinks (5.65% vs 5.8%), and Juices (3.6% vs 6.4%). Mineral & Spring water inflation increased to 5% vs 3.95%.
Alcoholic beverages inflation is up significantly in June to 5% from 3.3% on higher inflation for spirits (4.9 vs 4%), wine (4.3% vs 2.9%) and beer (6.25% vs 3.2%). Tobacco inflation is stable at 7.9% yoy.
Goods excluding energy inflation increased to 1.8% from 1.6%. Inflation is up for clothing, footwear, furniture, appliances, Garden tools & Equipment, pharmaceuticals, auto parts… Inflation is lower for new cars and stable for used cars. For Goods the increase was mainly driven by non-durable households’ goods and industrial goods.
In services inflation is stable at 4.7%, 0.6% m/m. Inflation increased for air transport (0.5% vs -4%), for railways (7.2% vs 4.5%), cultural services (3.2% vs 2.8%), restaurants (4.1% vs 4%), car insurance (9.7% vs -11.5%). Inflation declined for accommodation to -1.9% vs -1% (up 2.4m/m but +3.3% m/m in June 2024), package holiday (5.5% vs 5.6%), Social protection (4.9% vs 5.4%), Rent (5.8% vs 6.1%. Recreational & sporting services, education, hospital, outpatient services see stable inflation.
The Italian CPI is confirmed at 1.7% yoy but the HICP is revised up to 1.8% yoy from 1.7% estimated in the preliminary Release, both are up 0.2% m/m (the HICP is up 0.24% rather than 0.16% estimated earlier. The CPI increased from 1.6% yoy in May and the HICP from 1.7% yoy. ISTAT provides a lot of details with the preliminary release (see previous comments), but there are some revisions. ISTAT final Release
The CPI excluding energy is confirmed at 2.1%, although revised down to 2.05% from 2.14% and the core CPI is revised down to 2% from 2.1%. still up from 1.9% yoy in May.
Energy inflation is revised down to -2.1% from -2.5% initially, as electricity prices inflation is lower than estimated earlier. Administrative price for energy are down to 22.6% from 29.25% in May. Liquid fuel prices is up (-7.5 vs -10.2% yoy for gasoline and -5.3% vs -9% for diesel). Electricity inflation is now down to 6.25% from 9.4% in May, Gas to -2.3% from 1.1% yoy.
Food inflation is also revised lower to 2.8% from 3% (up from 2.6% in May) although unprocessed food is maintained at 4.15%. Non-alcoholic beverages inflation is revised lower to 9.9% from 10.4% (still up from 9.8% in May), and alcoholic beverages down to -0.7% yoy from -0.2% yoy published earlier, up from -0.8% in May. Beef & veal prices inflation increased to 5.7% from 5.2% and we see higher inflation for milk (6.7% vs 6.4%), eggs (7.3% vs 7.1%), cheese (6.3% vs 5.75%). Oil & fats (-8.9% vs -7.6%), vegetables (0.9% vs 1.7%) weighted down on inflation.
For Non-alcoholic beverages the downward revision came from coffee, revised down to 24.8% from 25% (24.7% in May) along cocoa-based drink at 21.3% vs 21.4% initially published still up from vs 19.1% in May.
Non-energy goods inflation is confirmed at 0.4% yoy, up from 0.3% yoy in May. Inflation is up for furniture, house textiles, appliances, Jewelry and was stable for Autos (new and used) and clothing & footwear
Services inflation is confirmed to be at 2.7% yoy up from 2.6% yoy in May. Inflation increased for package holidays (7.5% vs 6.3%) and transport services (2.85% vs 2.6% mainly road and sea transport and domestic air transport, down for international) Restaurants (3.3% vs 3.2%). Social protection, education and rent saw stable inflation. Inflation decreased for accommodation (3.2% vs 3.3%), cultural services (3.3% vs 5.1%) and sporting & recreational services (7.7% vs 8.1%). Auto insurance inflation decreased to 4.7% from 5.2%. Rent inflation is stable at 3.9% yoy,
Beverages
Detailed Table
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Wednesday, July 16, 2025 | ||
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SAND | |||
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SEK |
234.90 |
+2.53% | |
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SAND |
Sandvik reported second-quarter revenue in line with expectations, but its adjusted EBITA results came nearly below forecasts on strong FX headwinds. Revenue fell by 5.5% to SEK 29,700 million. Organic sales growth reached 3 percent (-2). "Rock Processing recorded stable demand in the mining sector, while the infrastructure market remained subdued," said CEO Stefan Widing in his statement. The adjusted EBITA result amounted to SEK 5,629 million (6,149), below the expected SEK 5,853, with an adjusted EBITA margin of 19.0 percent (19.6). | ||
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RIO |
RIO TINTO PLC | ||
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GBp |
4403.59 |
+1.33% | |
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RIO |
Rio Tinto Iron Ore production rose by 13% Y/Y to 79.9MT during Q2. Rio Tinto continues to expect Pilbara shipments to be at the lower end of the 2025 guidance, due to four cyclones as announced in Q1. Port maintenance in Q1 was postponed to Q2 due to cyclone impacts, with some work remaining in Q3. As a result, Iron Ore's Q2 shipments were up only 2%. Bauxite production was up 5% and Copper +9%. Bauxite production is expected to be at the higher end of guidance range. Copper production is expected to be at the higher end of guidance due to the continued successful ramp up of Oyu Tolgoi underground mine and good performance at Escondida. | ||
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CFR | |||
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CHF |
149.55 |
+0.98% | |
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CFR |
Richemont reported Group sales at € 5.4 billion, up by 6% at constant exchange rates and by 3% at actual exchange rates driven by continued strength at Jewellery Maisons, up by 11% at constant exchange rates; softer sequential rate of decline at Specialist Watchmakers, down by 7%; ‘Other’, including Fashion & Accessories Maisons, at -1%. Double-digit growth in Europe, the Americas and Middle East & Africa; stable sales in Asia Pacific at constant exchange rates; Japan down on high comparatives in prior-year period. The Group’s net cash position on 30 June 2025 stood at € 7.4 billion (2024: € 7.3 billion) after accounting for the € 426 million cash-out upon completion of the sale of YNAP to Mytheresa on 23 April 2025. | ||
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ANTO |
ANTOFAGASTA PLC | ||
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GBp |
1840.50 |
+0.08% | |
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ANTO |
Copper production in Q2 2025 was 160,100 tons, representing a 3% increase quarter-on-quarter, reflecting higher output from the Group’s two concentrators (Centinela Concentrates and Los Pelambres), offset by lower output from the Group’s cathode operations. Gold production in Q2 2025 was 48,300 ounces, 13% higher than the prior quarter, with an increase in | ||
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SEB A |
Skandinaviska Enskilda Banken AB | ||
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SEK |
163.30 |
-0.85% | |
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SEB A |
Bank SEB reported revenues in line with expectations for the second quarter, while its operating profit came in higher than anticipated. | ||
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STLAM | |||
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EUR |
8.26 |
-3.21% | |
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STLAM |
Stellantis today announced its decision to discontinue its hydrogen fuel cell technology development program. Due to limited availability of hydrogen refueling infrastructure, high capital requirements, and the need for stronger consumer purchasing incentives, the Company does not anticipate the adoption of hydrogen-powered light commercial vehicles before the end of the decade. As a result, Stellantis will no longer launch its new range of hydrogen-powered Pro One vehicles this year. Serial production was scheduled to start this summer in Hordain, France (medium-sized vans) and Gliwice, Poland (large vans). The current state of the hydrogen segment also presents financial challenges for various stakeholders. In this context, Stellantis has initiated discussions with the shareholders of Symbio to evaluate the current market consequences and to preserve the best interests of Symbio, in line with their respective obligations. Symbio's main shareholders are Forvia, Michelin, and Stellantis, each holding a 33.3% stake in the company. | ||
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SHB B | |||
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SEK |
183.10 |
-5.96% | |
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SHB B |
Handelsbanken reported lower-than-expected revenues for the second quarter, with operating profit also coming in below forecasts. The bank's trading result was significantly weaker than anticipated. | ||
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ASML | |||
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EUR |
659.40 |
-6.61% | |
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ASML |
ASML's Q2 results came in at the top end of guidance, but the company poured cold water on investor sentiment by stating that, due to increasing macroeconomic uncertainties, 'while we still prepare for growth in 2026, we cannot confirm it at this stage.'. Q2 total net sales of €7.692 billion (Consensus 7.544), gross margin of 53.7% (Consensus 51.6%), net income of €2.3 billion | ||
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RNO | |||
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EUR |
34.22 |
-17.04% | |
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RNO |
Renault pre-announced H1 results and a FY2025 guidance cut. Revenue for H1 2025 rose slightly by 2.5% to €27.6 billion, but operating margins slipped to 6.0% and free cash flow was just €47 million. This cash flow was dragged down by a negative working capital swing of about €900 million, reflecting lower sales and high inventories, particularly after a disappointing June performance. Sales volumes failed to meet expectations, with Renault citing increasing market and competitive pressures as well as an underperforming light commercial vehicle (LCV) segment in a contracting European market. Renault revised its full-year 2025 guidance downward: | ||
Versus early hours
SECTOR PERFORMANCE
Versus early hours:
Indices
Versus early hours
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