Monday Report


US statistics were satisfactory overall. In particular, the ISM Non-Manufacturing Index rose sharply in March to an all-time high of 63.7, well ahead of expectations. The uptick in producer prices (up 1% MoM and 4.2% YoY) was due to base effects (with the pandemic starting one year ago) but should be monitored. In the eurozone, investor confidence in the economy (Sentix) improved significantly in April (up from 5 to 13.1), while the March services PMI was upgraded slightly (from 48.8 to 49.6). Lastly, in China, the Caixin services PMI rose from 51.5 to 54.3 in March. Inflation also quickened, with consumer prices up 0.4% YoY and producer prices 4.4% YoY.


According to a survey by BloombergNEF, Europe’s share of global production of electric vehicle batteries could rise from 7% in 2020 to 31% (vs. 59% for China) by 2030, with the market set to equate to 2,260 GWh a year by that date. The sector is supported by over €6bn in public subsidies and more than ten times that amount in planned investment, with VW alone set to invest $18bn, which could make it the world’s number two producer.


Risk appetite remained high, with equities gaining 2.4% (MSCI World), copper up 1.8% and credit spreads narrowing slightly in the bond segment. Ten-year sovereign yields rose a few basis points in Europe and fell in the US, pushing the dollar lower (with the dollar index down 0.9%) and gold higher (up 0.8%). To be monitored this week: SME confidence (NFIB index), Philadelphia Fed confidence indicator, NAHB index of confidence among homebuilders, consumer confidence (Univ. of Michigan), retail sales, industrial production and CPI in the US; retail sales and industrial production in the eurozone; and trade balance, retail sales, investment, industrial production and Q1 GDP in China.

Swiss Market

To be monitored this week: SNB Federal bond issue, Flughafen Zürich March passenger statistics and FSO March producer and import prices. The following companies are due to report: Q1 sales – Bossard, Givaudan, Gurit and Conzzeta; 2020 results – Hochdorf, Burkhalter, SHL, Montana Tech, La Mobilière, Groupe Minoteries and Relief.


ATOS has been removed from our Satellite Recommendations following a breakdown of trust after the statutory auditors issued a qualified opinion on the 2020 financial statements of two US entities. With management not looking very confident over the past few weeks, we thought it best to cut the position.
BAIDU has been added to our Asian Satellites with the b-Digital label. Baidu is the leading search engine in China. While advertising still accounts for the lion’s share of its revenue (70%), the group has boosted its long-term vision by investing in cloud computing and artificial intelligence, which will diversify its revenue streams.
L’ORÉAL (Core Holdings) is due to report Q1 2021 sales this Thursday showing one of, if not, the best organic sales growth performances in the sector (consensus: 7-8%), buoyed by a favourable base effect (vs. Q1 2020), strong momentum in Skin Care/Cosmetics and a revival in Professional Products (hair care).
TENCENT has been added to our Asian Satellites with the b-Digital label. The group has China’s largest user base, with major platforms in five key areas: communication, social media, gaming (in which it is the global leader), media and miscellaneous services. After Tencent coped fairly adroitly with a slew of regulations, we see the share as a buy opportunity at below $80.


The Fed minutes – interpreted by investors as dovish – drove US yields downwards, with 10-year yields ending the week down 6 bps at 1.66%, 8 bps below their new post-COVID high of 31 March (1.74%). Conversely, European yields ended the week higher, particularly in peripheral Europe (with Italian 10-year yields up 10 bps). In credit, spreads on HY indices narrowed sharply in Europe and the US (down 12 bps and 5 bps respectively), falling to new post-COVID lows in both regions.

Sentiment of traders

Stock market
Indices have been breaking one record after another, buoyed by plentiful liquidity and hopes of economic recovery as vaccination progresses. Results season kicks off this week, with US banks opening proceedings. On the macro front, we expect the ZEW indicator in Europe, retail sales in the US, and CPIs and industrial production in the US and the eurozone. We remain confident.
USD fell victim to profit-taking last week after a pause in the uptrend in US 10-year yields: EUR/USD 1.1882; USD/CHF 0.9260. With the Fed expecting the US economy to bounce back, we remain positive on USD. CHF has strengthened to EUR/CHF 1.1005 and continues to trade in the range 1.0960-1.11. Gold is trading at $1,739/oz. Our ranges – EUR/USD: supp. 1.18, res. 1.1950; USD/CHF: supp. 0.92, res. 0.9436; GBP/USD: supp. 1.3640, res. 1.3840.

Today’s graph


This document has been issued for information purposes and is exclusively supplied by Bordier & Cie SCmA in the framework of an existing contractual relationship with the recipient of this document. The views and opinions contained in it are those of Bordier & Cie SCmA. Its contents may not be reproduced or redistributed by unauthorized persons. The user will be held liable for any unauthorized reproduction or circulation of this document, which may give rise to legal proceedings. All the information contained in it is provided for information only and should in no way be taken as investment, legal or tax advice provided to third parties. Furthermore, it is emphasized that the provisions of our legal information page are fully applicable to this document and namely provisions concerning the restrictions arising from different national laws and regulations. Consequently, Bordier Bank does namely not provide any investment services or advice to “US persons” as defined by the Securities and Exchange Commission rules. Furthermore, the information on our website – including the present document – is by no mean directed to such persons or entities.


Thank you !