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Translation: Down by 1.1%, the Danish OMXC20 index was no exception to the decline in the European markets. The
Translation Services four heavy shares of the index: AP Møller Mærsk, Novo Nordisk, Danske Bank and Carlsberg all lost
ground. Vestas, on the contrary, closed up by 0.9. The great loser of the day was William Demant
which was down by 5.2%.
DSV was one of the two shares of the OMXC20 index which closed in positive territory in yesterday’s
market. Up by 0.5%, the share slightly caught up with Monday’s fall of 2.3%.
The markets were generally dominated by jitters and ”holiday mode”. This is also the case with respect
to news. We only see very scarce business-related news, and the news which is released is primarily of
a negative nature. IBM as well as Texas Instruments disappointed their investors with the release of
weak accounts. The US bank Goldman Sachs’ weak accounts followed the trend which was on Friday
initiated by the rival Citigroup.
Read more equity-
research reports on On Tuesday, the Swedish bank, Handelsbanken, published weak Q2 accounts. Especially interest
www.jyskemarkets.com/ income disappointed the markets. Consequently, the share reported a fall of 2.12%. Whether
Handelsbanken’s accounts can be seen as an indicator of the other Nordic banks is a question which
Disclaimer:
may partly be answered today, Wednesday, when Nordea’s Q2 accounts have been released.
Please see the last page
EQUITIES DAILY
Equity Research • 21 July 2010
Outside Denmark, the focus of attention will be on Morgan Stanley and the softdrink producer Coca
Cola which will both publish their accounts today.
Also in the US, Ben Bernanke, Chairman of the Fed, will at 15:00 Danish time give his semi-annual
address on the monetary policy and the US economy.
Based on yesterday’s increases in the US markets as well as the DAX future, the Danish OMXC20
index is expected to start the day on a positive note.
ABB (BUY):
When ABB releases its accounts on Thursday, 22 July at 6.00 a.m, focus will very much be on the order
inflow and the development in the earnings margin. JB: We expect the order inflow to be approx. USD
7.5bn-8bn, i.e. a minor increase y/y. Compared to Q1 2010 we expect an increase in the earnings
margin to 11.8% from 10.2%. The increase will primarily take place through cost savings and due to the
fact that ABB will not have any extraordinary write-downs of project provisions as was the case in Q1.
We reiterate our BUY recommendation up to the announcement of the accounts.
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EQUITIES DAILY
Equity Research • 21 July 2010
Nokia (BUY):
Tomorrow at about 12 noon, Nokia will release its Q2 accounts; yet, the interest is not as high as already
back in June, Nokia chose to lower its expectations. JB: The focus at the release of the accounts will be on
the number of phones sold, the average price of these phones and the earnings margin in ”Devices &
Services”. Also, comments about the new Nokia N8, an important launch for Nokia in the smartphone
market, will attract attention. A high degree of interest in and a launch according to plans of this
phone will improve the product mix in Q3 and Q4 and boost earnings. We reiterate our BUY
recommendation for the Nokia share.
Nordea (REDUCE):
Solid accounts without any surprises Nordea’s Q2 accounts were practically in line with anticipations.
Net interest income rose a bit due to the decent growth in lending. JB: The interest-rate development
over the quarter surprised Nokia, and therefore the bank had to record a steep fall in earnings from
financial items at market value. On the bottom line, the result is a tad below our expectations and a
tad above consensus. We regard the accounts as satisfactory.
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EQUITIES DAILY
Equity Research • 21 July 2010
430 10.600
420 10.400
410 10.200
400 10.000
390 9.800
380 9.600
370 9.400
360 9.200
1140,0
10.400
1120,0
10.200
1100,0
10.000
1080,0
9.800
1060,0
9.600
1040,0
1020,0 9.400
1000,0 9.200
980,0 9.000
960,0 8.800
8.600
6400,0 80
6300,0
78
6200,0
6100,0 76
6000,0
74
5900,0
5800,0 72
5700,0
70
5600,0
5500,0 68
Switch recommendation
Jyske Bank recommends the following switches:
From Genmab (REDUCE) to NeuroSearch (BUY).
From D/S Norden (REDUCE) and Torm (REDUCE) to A.P. Møller-Mærsk (ACCUMULATE)
From William Demant (REDUCE) and GN Great Nordic (REDUCE) to Coloplast (ACCUMULATE)
From Pfizer (SELL) to Sanofi-Aventis (BUY)
From Novo Nordisk (REDUCE) to Sanofi-Aventis (BUY) and Novozymes (BUY)
From FLSmidth (REDUCE) to NKT Holding (BUY)
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EQUITIES DAILY
Equity Research • 21 July 2010
Macroeconomic events
Time Event
US
15:00 USD The Chairman of the Fed’s semi-annual address on monetary policy and the US
economy.
European
10:30 GBP Minutes of MP meeting
Asian and others
06:30 JPY Activity index, industry
Yours faithfully,
JYSKE MARKETS
Jyske Bank
Equities
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EQUITIES DAILY
Equity Research • 21 July 2010
Jyske Bank's analysts are subject to the recommendations of The Danish Securities Dealers Association on the handling of conflicts of interest in investment
banks.
The research report is based on information which Jyske Bank finds reliable, but Jyske Bank does not assume any responsibility for the correctness of the material
nor for transactions made on the basis of the information or the estimates of the report. The estimates and recommendations of the research report may be
changed without notice. The report is for the personal use of Jyske Bank's customers and may not be copied.
Conflicss of interest
Jyske Bank has prepared procedures to prevent and preclude conflicts of interest thus ensuring that research reports are being prepared in an objective manner.
These procedures have been incorporated in the business procedures covering the research activities of Jyske Markets, a business unit of Jyske Bank.
Moreover, equity analysts at Jyske Bank cannot trade in companies and papers for which they prepare research reports. Jyske Bank may, however, hold positions,
have interests in or business relations with the companies that are analysed. The research report has not been presented to the company prior to its release. The
analysts receive no payment from persons interested in individual research reports.
Allocation of recommendations, Danish shares (number) Allocation of recommendations, all shares (number)
14 20
12
10 15
8
10
6
4 5
2
0 0
Buy Accumulate Neutral Reduce Sell Buy Accumulate Neutral Reduce Sell
Risk
Investment in this share is associated with a risk. Movements in the equity market, the sector and/or news flows, etc. regarding the company may affect the
price of the share. See the front page of the research report for our view of the risk associated with the share. The risk factors stated and/or calculations of
sensitivities in the research report are not to be considered all-encompassing. If the share is traded in a currency other than the investor’s base currency, the
investor accepts an FX risk. In connection with an ADR or similar papers, the FX risk exists relative to the currency in which the underlying share trades.
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EQUITIES DAILY
Equity Research • 21 July 2010
Recommendation Return relative to the performance of the
general equity market
BUY >5%
ACCUMULATE 0 to 5%
NEUTRAL 0%
REDUCE 0 to -5%
SELL < -5%
Source: Jyske Bank
Since our recommendations are relative and risk-adjusted, it is possible to compare our recommendations across sectors and risk categories. In addition, the
potential is stated in absolute terms via our price target. It should be borne in mind, however, that the recommendation is the anchor. A BUY recommendation is
a BUY recommendation until the recommendation has been changed, also in the event that price increases have taken the price "too close" to the price target.
The future and historical returns estimated in the research report are stated as returns before costs since returns after costs depend on a number of factors
relating to individual customer relations, custodian charges, volume of trade as well as market-, currency- and product-specific factors. It is not certain that the
share will yield the stated expected future return/s. The stated expected future returns exclusively express our best assessment.