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Lyft Seeks $23bn IPO Valuation - EMEA Brief 19 March

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  • Lyft, the ride-hailing company and one of Uber's main competitors, has begun its investor roadshow to pitch its Nasdaq listing as it looks to raise $2bn at a valuation of around $23bn. The company suggested a price range between $62 and $68 per share in its filing to the SEC on Monday, and will use the ticker symbol LYFT when it begins trading. This is a first indication of what ride sharing companies could be worth in public markets as we await Uber's IPO in the coming months. 
  • Theresa May's Brexit plans faces further hurdles as Speaker John Bercow ruled yesterday that she could not allow a new vote unless the agreement was submitted in a substantially different form to the one defeated twice before, in January and last week. 
  • Asian shares traded within tight ranges on Tuesday as investors await the Fed's policy meeting tomorrow, where expectations are a dovish tone from the central bank. The Nikkei dropped 0.3%, while Australian shares fell 0.1%. 
  • Major U.S. indices gained overnight on the back of speculation of a dovish Fed, with the Dow Jones, the S&P 500, and the Nasdaq each posting between 0.3 to 0.4%.
  • In the currency market, the pound slipped as slow as $1.3183 overnight as doubt forms over May's attempt to get MPs to back her Brexit deal. The dollar basket index traded at 96.475, close to a two-week low. 
  • Oil prices continue to rise over ongoing supply cuts and U.S. sanctions. WTI traded at $59.09 whilst Brent Crude was at $67.62 a barrel.
  • Palladium hits a record high of $1,593.77 an oz as the risk of a ban on exports by Russia, a major producer of the precious metal, adds to supply concerns. 

UK, US and Europe: A four-month high for the S&P 500 confirms the recovery in equities, while emerging markets are also doing well, as seen by the Brazilian index, which surpassed 100,000 for the first time. The UK government's plans to hold a third Meaningful Vote were scuppered by the Speaker, and it now looks like a vote will not be held this week. UK unemployment data and the German ZEW index are on the list for the day, while US markets and the dollar prepare for the Fed decision tomorrow.

South Africa: Global equity markets are are trading flat today as markets wait for central bank meetings later this week to guide them further. The US Federal Reserve will advise markets on Wednesday as to the future of monetary policy within the region. The expectation is that the bank may move to suggest just one rate hike later this year, a far less hawkish stance than was evident late last year. The dollar trade slightly softer and in turn we see commodity prices slightly higher and the rand slightly firmer as well. Tencent Holdings is down 0.5% in Asia, suggestive of a similar start for major holding company Naspers. BHP Group is up 1.5% in Australia, suggestive of a positive start for local resource counters. 

Economic calendar - key events and forecast (times in GMT)

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Source: Daily FX Economic Calendar

9.30am – UK employment data: 150K jobs expected to have been created in December, while the January unemployment rate holds at 4%. Average hourly earnings to rise 3.5% in January. Markets to watch: GBP crosses

10am – German ZEW index (March): economic sentiment to fall to -14 from -13.4. Markets to watch: EUR crosses

11.50pm - BoJ meeting minutes.Markets to watch: JPY crosses

Corporate News, Upgrades and Downgrades

  • Ocado said that a fire at its Andover location meant revenue in the first quarter fell 11.2%, and that the firm was still assessing 2019 guidance for 10-15% revenue growth.
  • Antofagasta said that full-year EBITDA fell 14.9% to $2.2 billion, while pre-tax profit fell 31.6% to $1.25 billion. Output guidance for 2019 was left unchanged at 750-790 thousand tonnes of copper.
  • Wood Group reported a 79% jump in revenue to $11.04 billion, while operating profit before exceptionals rose 68% to $357 million.

Baloise upgraded to overweight at JPMorgan
Deutz upgraded to buy at Kepler Cheuvreux
Hikma upgraded to buy at Citi
Informa upgraded to overweight at Morgan Stanley

DWS downgraded to hold at DZ Bank
Leoni downgraded to underperform at MainFirst
Wacker Neuson downgraded to hold at Commerzbank
Marshalls downgraded to hold at Berenberg

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