Daimler AG said that results in the second quarter of the year were above market expectations despite negative effects from the shortage of semiconductor components. According to preliminary figures, the German car maker’s group earnings before interest and taxes came in at 5.19 billion euros ($6.14 billion). This compared with consensus estimates provided by the company of EUR4.12 billion and a prior-year loss before interest and taxes of EUR1.68 billion. On an adjusted basis, EBIT for the group came in at EUR5.42 billion, compared with a loss of EUR708 million in the same period 2020 and consensus expectations of EUR4.29 billion. “We continue to deliver a strong financial performance in all divisions despite the ongoing low availability of semiconductors, which negatively impacted our production and sales in the second quarter,” said Chief Executive Ola Kallenius. The auto maker said its Mercedes-Benz Cars & Vans division benefited from favorable product mix, pricing and continuing cost control, and it was able to generate double-digit margins for the third quarter in a row. Adjusted return on sales was 12.8%, compared with minus 1.5% in the same quarter the year earlier and expectations of 11.5%. Adjusted EBIT at the car business was EUR3.60 billion.

Share prices in Zurich went down again on Thursday, this time somewhat more strongly than on the previous day. Stockbrokers spoke of a consolidation close to the record highs - not only in Zurich. The SMI lost 0.6 per cent to 11,977 points, a good 100 points below its record high of 7 July. Among the 20 SMI stocks, there were 14 price losers and five price gainers; Swisscom shares closed unchanged. 28.04 (Wednesday: 25.77) million shares were traded. Sector trends within the SMI were hardly discernible. Richemont (-1.8%), which had been far ahead the previous day in the wake of Swatch's latest strong figures, was at the bottom. Swatch was down 1.0 per cent after previous days' gains. Credit Suisse (+0.1 per cent), which had recently been heavily weighed down due to heightened uncertainty ahead of the imminent presentation of its quarterly figures, showed signs of stabilisation. The analysts at Jefferies have added the share to their list of observed values with a recommendation of Hold. On the other hand, they included the share of competitor UBS (+0.3%) with a buy recommendation because they see better opportunities for the wealth management business and investment banking here.

European equity indices fell on Thursday, weighed down by renewed concerns about the strength of the global economic recovery after China's growth slowed in the second quarter and US economic indicators were mixed. Investors also opted for caution after Federal Reserve (Fed) Chairman Jerome Powell admitted on Thursday that rising consumer prices in the US were making the Fed "uncomfortable". The Stoxx Europe 600 index lost 1% to 456.2 points. In Paris, the CAC 40 and the SBF 120 also gave up 1% each, as did the DAX 30 in Frankfurt, while in London, the FTSE 100 was down 1.1%. Shares in Germany’s Siemens Energy AG and its Spanish subsidiary Siemens Gamesa Renewable Energy SA fell sharply in opening trade Thursday after the latter issued a profit warning for the fiscal year, leading Siemens Energy to also lower its outlook. Late Wednesday, Siemens Gamesa said it now expects an adjusted earnings before interest and taxes margin of minus 1%-0%, from 3%-5% previously, after booking an adjusted operating loss of 150 million euros ($177.6 million) in the third quarter of the fiscal year on higher provisions.

U.S. stocks ended mostly lower Thursday after the Federal Reserve chief said recent inflation was uncomfortably above the levels that the central bank seeks and sounded somewhat less confident about the economic outlook than earlier in the year. The S&P 500 finished the session 14.27 points lower, or 0.3%, to end at 4360.03. The Nasdaq composite fell 101.82 points, or 0.7%, to 14543.13. In contrast, the Dow Jones Industrial Average finished its choppy session Thursday 53.79 points higher, or 0.2%, to 34987.02, the second-highest close in its history. NortonLifeLock Inc. is in talks to buy cybersecurity firm Avast Plc in a deal that would expand the U.S. company’s focus on consumer software. Avast said late Wednesday that the two were in advanced discussions about a cash-and-stock deal after The Wall Street Journal reported on the talks earlier Wednesday. A deal could be completed this month, assuming talks don’t fall apart, according to people familiar with the matter. Avast has a market value of around £5.2 billion (around $7.2 billion). Assuming a typical deal premium, the deal could value the cybersecurity firm at more than $8 billion. Blackstone Group Inc. struck a sweeping deal with American International Group Inc. to manage a portion of the assets backing AIG’s life-insurance policies and annuities, a big step by the private-equity firm toward becoming a major player in the insurance industry. Blackstone will enter into a long-term agreement to manage an initial $50 billion in assets, with the amount increasing to nearly $100 billion over the next six years, the companies said Wednesday. The AIG unit has roughly $200 billion in assets.

Once again, the stock markets in East Asia and Australia show no consistent trend on the last trading day of the week. The Hang Seng Index in Hong Kong bucked the trend and extended its previous day's gains, gaining 0.5 per cent. As feared, the Bank of Japan (BoJ) lowered its growth forecast for this fiscal year, but maintained its view that the economy is heading for a moderate upswing. Economic growth of 3.8 per cent is now expected, compared to 4.0 per cent previously. The estimate for 2022, on the other hand, was revised upwards to plus 2.7 from plus 2.4 per cent, as consumption is expected to pick up with the acceleration of vaccinations.

As investors try to foresee the long-term impact of price increases, inflation-indexed Treasurys, or TIPS, remain in high demand, driving yields deeper into negative territory. Tradeweb said the five-year TIPS yield has fallen to -1.786% from -1.507%, and the 10-year slid to -1.024% from -0.769%.

JP Morgan rises Zurich Insurance target to 434 (432) CHF – Overweight
UBS rises MTU target to 215 (203) EUR – Neutral
Deutsche Bank rises Novo Nordisk target to 550 (535) DKK – Buy

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