It’s the cycle, dummy, is the motto today with Besi, Akzo and the rest

It’s the economic cycle, dummy!

The AEX indication is -0.2%, which is perhaps not so bad considering the interest rates and also upcoming 3rd quarters. Besi and AkzoNobel in particular confirm that the economy is making water here and there, as did a number of US funds last night.

  • European futures all open around zero
  • Also the American, apart from the Nasdaq 100 mini, which makes -0.4 per cent.
  • In Asia, China is flat, but the rest are up to one percent lower. However, the Hang Seng falls -1.7 per cent. So more on this, because it’s not good there
  • Volatility (CBOE VIX Index) is +0.9% at 30.8
  • The dollar fell 0.1% to 0.9785. The yen is at its lowest level since 1990
  • Gold is 0.2% lower, oil is up +1.3% and crypto is down a few tenths

Interest rates again and oh my – they haven’t even finished their coffee yet – they are already rising Bokito Well how much room do stocks have as long as interest rates continue to rise?

Sir. Of course, the market can at any time decide that the fun is over and simply nullify the wonderful correlation between stocks and interest rates. That won’t happen for the time being, see here again AEX in orange and our ten-year in purple.

Incidentally, we have no complaints here in Amsterdam. For example, in Hong Kong, the Hang Seng is at its lowest level since … the credit crunch.


First things first
, Besi has Q3s with double-digit declines in sales and profits, and the company believes Q4 sales will fall 15-25%. So the cycle and market conditions, well anyone who thought that chippers are no longer cyclical, have their homework. Here is the grim match report, how much is this priced?

Our analyst Paul Weeteling chatted with me and you can expect a review from him soon.

Besi’s results are good in light of the much lower turnover level. Order intake is very weak. The bottom cycle was clearly not yet in the 3rd quarter.

And if the cycle bites! AkzoNobel had already forecast a profit, but now withdraws the outlook for 2022 and 2023 at the 3rd quarter. Again, how much is this priced?

You may need to start paying close attention to your cycle conditions. I’m even surprised by that übercyclic ArcelorMittal perseveres. The expensive DSM and IMCD have caught on.

Nedap also reports Q3s (here) that address the known issues but maintain the outlook. Sligro is also finished with Q3s and does not issue outlook (here) and finally Cabka also reports (here).

Last night, Tesla was down 6.3% in after-hours trading (after initial gains) in Q3. Profits weren’t too bad, revenue was disappointing, and the company is coming off a recession it doesn’t think it will be bothered by. These are the CNBC headlines in brief, you can read the ABM FN-Dow Jones report here.

Tesla reported $1.05 in adjusted EPS, ahead of expectations of 99 cents, on revenue of $21.45 billion, short of expectations of $21.96 billion.

Net income (GAAP) reached $3.33 billion, more than double from a year ago, while automotive revenue rose 55% from the year-ago quarter.

The company warned of a bottleneck in transportation capacity for new car deliveries in the final weeks of the quarter and said it was “transitioning to a smoother delivery pace.”

From the conference call:

On Tesla’s third-quarter earnings call, CEO Elon Musk said the company is not cutting production “in any meaningful way, recession or no recession.”

“We’re very much pedal to the metal come rain or shine,” Musk said.

Regarding Musk’s proposed $44 billion purchase of Twitter, he said the company “kind of languished for a long time, but has incredible potential.”

These Americans also had numbers:

Alcohol -8.0%
IBM +2.9%
PPG -1.7%

So this and surely there are among us who do it better. Remember that these pension funds are not only in stocks, but also in bonds, and you know what they are going through this year. Worst ever just about.

News, advice, shorts and agenda

The main ABM Financial news since the Amsterdam close yesterday.

  • 08:17 AEX probably started a little lower
  • 08:07 Cabka sees growth slowing down a bit
  • 08:00 Sligro sees revenue increase
  • 07:57 Wereldhave success with refinancing
  • 07:49 AkzoNobel releases targets for 2023
  • 07:40 Besi warns of weak market conditions
  • 07:33 Japanese exports continue to grow
  • 07:24 Besi warns of weak market conditions
  • 07:24 More revenue for Nedap in the third quarter
  • 06:55 Dutch investments up again
  • 06:54 European shares open lower
  • 06:53 Dutch consumption also increases in September
  • 06:52 Dutch consumer confidence stabilizes
  • 06:47 Unemployment stabilizes
  • 06:37 Exhibition agenda: Dutch companies
  • 06:37 Exhibition agenda: foreign foundations
  • 06:37 The stock exchange’s agenda: macroeconomic
  • October 19 PPG reports lower profit
  • 19 Oct. IBM exceeds expectations
  • 19 Oct Alcoa records a loss
  • 19 Oct Tesla is just short of record profits
  • Oct 19 Stock Update: AEX on Wall Street
  • 19 Oct WDP successfully collects 300 million
  • October 19 Wall Street closed lower
  • 19 Oct Scottish order to Envipco
  • 19 Oct The oil price closed higher
  • Oct 19 US economic activity has grown modestly – Beige Book
  • Oct 19 Wall Street heads towards a lower close
  • 19 Oct. Ordina withdraws shares
  • 19 Oct European shares closed lower
  • Oct 19 AEX closes higher thanks to strong ASML

AFM reports these shorts:

The agenda is packed and keep an eye on Snap, the Philadelphia Fed Index and the US housing numbers:

07:00 AkzoNobel – Figures for the third quarter
07:00 Besi – Third quarter numbers
07:30 Sligro – Third quarter figures
08:00 Cabka – Trade Update
08:00 Relx – Third quarter figures
18:00 Nedap – Third quarter figures

13:00 AT&T – US figures for the third quarter
13:00 ManpowerGroup – figures for the third quarter (USA)
13:00 Philip Morris – US Third Quarter Figures
22:00 Snap – Figures for the third quarter (USA)

00:50 Trade balance – September (Japan)
06:30 Consumer confidence – October (NL)
06:30 Household consumption – August (NL)
06:30 Investments – August (NL)
06:30 Unemployment – September (NL)
08:00 Producer Awards – September (Germany)
14:30 Support Requests – Weekly (US)
14:30 Philadelphia Fed Index – October (USA)
16:00 Existing home sales – September (USA)
16:00 Leading Indicators – September (US)

This is Snap, which went horribly wet twice earlier this year due to severely disappointing numbers and outlook. Still getting the picture?

And then this

It was sparse last night:

Oh yes, Fat Beige Book:

Surprising?

The great miracle of today’s bad times? The tight labor market.

Also applies to consumption!

Now Unilever:

Does it really hurt?

Not only in China, not only Besi, but worldwide is the malaise apart from a town in Brabant?

It’s bad everywhere:

Who do we have here?

Have fun and good luck today.

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