Hennes & Mauritz’s shares plunged after it made a weak start to its third quarter and warned that its performance would be hurt by rising raw material costs and adverse currency moves. H&M stock was recently down 13% at SEK169. “The most important prerequisite for achieving our goal is that sales growth is further strengthened in the second half of the year compared with the second quarter increase,” said Chief Executive Daniel Erver. The Swedish fashion retailer is targeting a 10% operating margin in fiscal 2024 and analysts have for some time questioned the attainability of reaching the target this year as the company has struggled to gain sales traction amid lower consumer buying-power, rising costs and fierce competition from low-cost, fast-fashion online rivals such as Shein as well as its larger, more traditional rival, Zara. It reported a margin of 11.9% in the fiscal second quarter to the end of May, versus 12.9% expected by analysts at Jefferies. The company said sales in June are expected to fall 6% in local currencies on the year as unstable weather in many of its large markets had a negative impact on sales at the start of the month, though sales recovered as the weather normalized at the end of it.

The Switzerland market ended slightly down on Thursday after a choppy session, with investors largely refraining from making significant moves ahead of crucial U.S. personal income & spending data. The benchmark SMI ended with a marginal loss of 11.41 points or 0.09% at 12,004.31, after scaling a low of 11,990.32 and a high of 12,050.52 intraday. SIG Group ended down by 2.83%. Kuehne & Nagel drifted down 1.3%. Swatch Group, Nestle, Geberit, SGS, Novartis and Swisscom lost 0.5 to 1%. Sandoz Group climbed 1.83% and Holcim gained 1.54%, while Straumann Holding and Schindler Ps ended higher by 1.11% and 1.08%, respectively. VAT Group ended nearly 1% up. Swiss Life Holding, Roche Holding and Sonova posted modest gains. Leclanché LECN shares climbed about 13.8% after announcing an agreement to set up a joint venture with Pinnacle International Capital, in which the UK private equity firm will invest 360 million francs.

Europe
European stocks closed broadly lower on Thursday amid concerns about inflation and lingering uncertainty about the outlook for Fed interest rates. Investors awaited the data on U.S. personal consumption expenditure for clues about Fed policy moves. Investors also braced for the first round of French parliamentary elections due over the weekend. Higher bond yields weighed as well on markets. The pan European Stoxx 600 ended down 0.43%. The U.K.'s FTSE 100 dropped 0.55%, and France's CAC 40 drifted down 1.03%, while Germany's DAX gained 0.3%. Switzerland's SMI edged down 0.09%. Among other markets in Europe, Denmark, Greece, Portugal, Spain and Sweden ended weak. Finland, Iceland, Netherlands, Norway, Poland and Turkiye closed higher. Austria and Belgium edged up In the UK market, Burberry Group dropped about 6.5%. GSK ended down 4.6% after a U.S. public health agency narrowed its usage recommendation for all respiratory syncytial virus (RSV) vaccines. Prudential, British American Tobacco and 3i Group lost 2.9 to 3.3%. Hikma Pharmaceuticals, Associated British Foods, Diageo, AstraZeneca, Rio Tinto, B&M European Value Retail, Severn Trent, Rolls-Royce Holdings and Anglo American Plc ended down by 1.5 to 2.3%. Smith (DS) Plc shares soared 15.7%. Mondi rallied 3.6%. Barclays Group, Admiral Group, Airtel Africa, Halma, Smiths Group, Relx, Diploma, Rentokil Initial, Intertek Group, Pearson, Auto Trader Group, Bunzl and Howden Joinery gained 1 to 2%. In the German market, Rheinmetall, Sartorius, Beiersdorf and Zalando lost 2 to 3%. RWE, Mercedes-Benz, Porsche, Infineon and E.ON also ended notably lower. MTU Aero Engines gained more than 5.5%. Siemens gained about 2.5%. HeidelbergCement and Vonovia also ended sharply higher.

United States
With traders looking ahead to the release of closely watched inflation data, stocks turned in a lackluster performance during trading on Thursday. The major averages spent the day bouncing back and forth across the unchanged line. The major averages eventually ended the session modestly higher. The Dow crept up 36.25 points or 0.1 percent to 39,164.06, the Nasdaq rose 53.53 points or 0.3 percent to 17,858.68 and the S&P 500 inched up 4.97 points or 0.1 percent to 5,482.87. The choppy trading on Wall Street came as traders seemed reluctant to make significant moves ahead of the release of key inflation data on Friday. The Commerce Department is due to release its report on personal income and spending in the month of May, which includes readings on inflation said to be preferred by the Federal Reserve. The report is expected to show a modest slowdown in the annual rate of consumer price growth and could have a significant impact on the outlook for interest rates. On the U.S. economic front, a report released by the Labor Department showed first-time claims for U.S. unemployment benefits fell by more than expected in the week ended June 22nd. Most of the major sectors showed only modest moves on the day, contributing to the lackluster performance by the broader markets. Networking stocks saw considerable strength, however, with the NYSE Arca Networking Index climbing by 1.3 percent. Significant strength was also visible among computer hardware stocks, as reflected by the 1.3 percent gain posted by the NYSE Arca Computer Hardware Index. Airline, gold and software stocks also saw notable strength, while a steep drop by shares of Micron (MU) weighed on the semiconductor sector. Micron plunged by 7.1 percent after the chipmaker reported better than expected fiscal third quarter results but provided guidance that disappointed investors.

Asia
The stock markets in East Asia are on the rise in the course of trading on Friday. Gains ranged from 0.3 per cent in Seoul to 1.0 per cent in Shanghai. Tokyo gained 0.7 per cent to 39,633 points. In Sydney, the stock market barometer rises by 0.4 per cent. Wall Street provided slight support. The indices there rose slightly across the board, while yields fell on the bond market after new data on private US consumption disappointed.

Bonds
In the U.S. bond market, treasuries moved back to the upside following the weakness seen on Wednesday. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, declined 2.8 basis points to 4.288 percent.

Analysis
BoA raises the Siemens Energy target to EUR 32 (30) – Buy
HSBC lowers the Stellantis target to EUR 22 (23.50) – Hold
UBS raises DSM-Firmenich to EUR 129 (122) – Buy

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