Ocado Share News (OCDO)

* Fed pulls out new bazooka
* Wall Street in the red
* More lockdowns to fight the epidemic
* STOXX down 3%
*

Welcome to the home for real-time coverage of European equity markets brought to you by Reuters
stocks reporters. You can share your thoughts with Thyagaraju Adinarayan
(thyagaraju.adinarayan@thomsonreuters.com), Joice Alves (joice.alves@thomsonreuters.com) and
Julien Ponthus (julien.ponthus@thomsonreuters.com) in London.

CORONA WINNERS: LIFE SUPPORT, CASINO, ONLINE GROCERS (1341 GMT)
Here's a quick list of winners in the last 30 trading sessions - one of the most violent
market crashes ever.

Europe RIC Business % change
AMBU B Life support 18.8
devices maker
QIAGEN (XET) Molecular testing 11.1
company
EVOLUTION provider of live 9.9
GAMING GROUP casino systems
ICA GRUPPEN online grocery 9.6
chain
OCADO GROUP UK online grocery 9.2
chain

U.S. RIC Business % change
REGENERON Pharma 14.8
PHARMS.
KROGER Supermarket 13.6
operator
CLOROX Cleaning products 6.7
maker
GILEAD Pharma 6.4
SCIENCES
GENERAL MILLS Cheerios cereals, 2.8
Yoplait yogurt

(Thyagaraju Adinarayan)
*****

FED IN BUZZ LIGHTYEAR MODE: EUROPE UNIMPRESSED (1335 GMT)
"To infinity and beyond", Michael Hewson at CMC Markets captured the mood in his midday note
after the Fed went into unchartered 'whatever it takes' territory again.
The famous catchprase of the Toy Story character Buzz Lightyear seems indeed appropriate to
describe an unprecedented decision which will allow the central bank to lend against notably
student loans, credit card loans and U.S. government backed-loans to small businesses.
But despite this massive move, U.S. futures are back in the red and European cash markets
are also slipping back further down with the STOXX 600 down about 3%.

(Julien Ponthus)
*****



DIVIDEND CUTS: CAN YOU HANDLE IT? (1245 GMT)
UK companies have cut or suspended 1.5 billion pounds in dividend payments since January as
they seek to save liquidity in the face of an expected coronavirus-driven recession.
But some investors are taking the view that dividend cut may not be the worst thing that can
happen and they are keen to hear how boardrooms are responding to the drop in business and could
even be willing to accept dividend cuts, writes AJ Bell Investment.
"If a dividend cut is part of the near-term price that must be paid to ensure a firm’s
long-term survival or avoid a major rights issue or debt-for-equity swap, then investors may
well come to accept it, even if the loss of the precious payments is a big blow," says Russ
Mould, AJ Bell's investment director.
Here is list from AJ Bell of the companies that have so far announced they suspended
dividend payments.

Announced Company Dividend cut/deferral
(£ million)
23-Mar-20 Bonhill 0.3
23-Mar-20 Go-Ahead 13.0
23-Mar-20 Stagecoach 22.3
23-Mar-20 Aggreko 46.5
23-Mar-20 Colefax 0.3
23-Mar-20 IWG 41.8
23-Mar-20 Card Factory (2nd) 21.9
23-Mar-20 N Brown 12.0
23-Mar-20 ITV 216.2
23-Mar-20 Kingfisher 158.0
20-Mar-20 Marks & Spencer 132.6
20-Mar-20 InterContinental 120.4
Hotels
20-Mar-20 Travis Perkins 83.2
20-Mar-20 Johnson Service 8.7
20-Mar-20 JD Wetherspoon 4.2
19-Mar-20 Crest Nicholson 56.0
19-Mar-20 Playtech 33.9
19-Mar-20 Elementis 26.0
19-Mar-20 NewRiver Reit 16.5
19-Mar-20 PPHE Hotel 8.5
19-Mar-20 Portmieirion 3.1
19-Mar-20 Gym Group 1.6
19-Mar-20 Shepherd Neame 0.9
18-Mar-20 MicroFocus 165.1
18-Mar-20 McCarthy &Stone 18.8
18-Mar-20 Marston's 17.8
18-Mar-20 Restaurant Group 12.4
17-Mar-20 Shoe Zone 4.0
16-Mar-20 William Hill 46.7
11-Mar-20 Costain 12.3
11-Mar-20 Dignity 12.2
10-Mar-20 John Menzies 12.2
26-Feb-20 McColl's Retail 0.7
25-Feb-20 Hammerson 91.2
12-Feb-20 INTU 62.3
30-Jan-20 Renishaw 5.1
09-Jan-20 Card Factory 17.1
TOTAL 1505.8
Source: Company accounts/AJ Bell

(Joice Alves)
*****



€3.7 TRILLION (1224 GMT)
Analysts at Jeffereis argue that unlike in 2008, when the banking sector was the epicentre
of the crisis, this time, lenders can actually help funding a recovery.
"The banks we cover have €3.7tn of available credit to support the economy via existing off
balance sheet commitments in addition to measures already announced at the fiscal, monetary and
macro-prudential level", they note.
"Unlike in the '08 GFC when banks' weak capital position and poor underwriting acumen
created a balance sheet-led recession, banks are a key part of the solution for the likely
industrial recession of '20", they add.

(Julien Ponthus)
*****


SELLOFF: PETROCHINA, SAUDI ARAMCO COINCIDENCE (1154 GMT)
Did you know the market top before the 2008 financial crisis came around PetroChina's IPO
and the market top this time around was preceded by Saudi Aramco's IPO.
Strange coincidence isn't it?
Another one here, both companies were the world's largest listed oil companies at the time
of the listing. Aramco is also still the world's most valuable listed entity (not sure for how
long, given the crude rout).
Meanwhile, a quick market update: for the first time in many sessions European stocks are
not jumping around a lot with the pan-European STOXX 600 sticking to minus 4% to 4.5%
range, precisely where the day begun.

(Thyagaraju Adinarayan)
*****

MARKETS WON’T RECOVER UNTIL WE ANSWER THESE QUESTIONS - BARINGS (1146 GMT)
Barings' chief global strategist believes these are the three key questions that need
answers before markets can recover.
1) How long will the economic shock from the coronavirus last?
It is hard to predict the length of the disruption, but there is some hope from Asia as
China seems to be returning to work after losing a quarter of normal economic activity, and
figures from other Asian countries are also encouraging, analysts at Barings say in a note.
"There is scepticism around the official numbers from Beijing, but the patterns in Japan
and Korea offer promise," writes Christopher Smart, Chief Global strategist and head of the
Barings Investment Institute.
2) Will government measures make a difference?
China has more government levers to shut down cities, but democratic governments and a
rising sense of community solidarity and responsibility across the world may help to spread the
call for social-distancing, Barings' Smart says.
Governments and central banks plan to pour trillion of dollars into the global economy in a
bid to cushion the loss of economic activity and more cash is on its way. "Over the next few
weeks, nothing will come soon enough. Yet, if the virus is truly under control later this year,
the monetary measures deliver their effect just as life returns to normal," Smart adds.
3) What damage will the crisis leave behind?
"The central question for anyone trying to price anything at all into these markets is will
global growth turn negative for one quarter or two?"

(Joice Alves)
*****

INFLATION ON THE HORIZON (1005 GMT)
Similar theme in two different notes from France: inflation and whether to expect its big
comeback after the coronavirus crisis.
For Philippe Waechter at Ostrum Asset Management, the main question is whether the best case
scenario for the sanitary crisis ending towards the end of April materialises.
If it does, the hundreds of billions thrown at the epidemic will probably manage to
stabilise the economy and buy time for a rebound to take place.
If not, more ECB money will be required, and there will be consequences.
"An unconstrained financing of an economy which no longer has the resources and the means to
invest to renew itself is very likely to lead to very high inflation", Waechter writes this
morning, evoking what Germany experienced in 1923.
A note from published by Gaspal Gestion on March 20 also made the point that the vast sums
of money spent currently are not comparable to the 1945 reconstruction effort: Europe's growth
potential in 2021 is likely to stay roughly the same than in 2020.
"Without very strong global growth, the massive funds issued and the necessity to service
the debt issued will necessarily lead to inflation", the note reads.

(Julien Ponthus)
*****


OPENING SNAPSHOT: JUST ANOTHER MANIC MONDAY (0827 GMT)
The open looks just like the picture painted by futures in the last couple of hours ago.
On the bright side, we're still above the March 16 lows.
European bourses are however trading well below 4% on average with the pain well spread
across most countries and sectors.
There is one exception though with UK-focused midcaps which are getting a dedicated beating
with the top 10 losers of the STOXX 600:

The FTSE 250 is a top loser with a loss of close to 6%. The pressure is building on British
domestic stocks as the government of Boris Johnson considers new measure to enforce social
distancing in a bid to flatten the infection curve.
Across Europe miners, industrials, travel and leisure, construction, financial services and
media are all trading below 5%.
Among the big European blue chips, Airbus is falling over 10% after withdrawing its 2020
financial guidance, dropping a proposed 2019 dividend that had a cash value of 1.4 billion euros
and suspending funding to top up staff pension schemes.
The latest figures show that more than 337,000 people have been infected by the novel
coronavirus across the world and 14,651 have died, with deaths in Italy surpassing the toll in
China where the outbreak began.

(Julien Ponthus)
*****



ON THE RADAR: NO DIVIDEND, NO GUIDANCE (0735 GMT)
As the headlines start piling up this morning, it seems European companies are adjusting
quickly to what looks more and more like a war economy.
Interesting story here of the Italian army sending technicians to companies to
help accelerate the production of ventilators.
In a very telling move, high-end fashion labels Saint Laurent and Balenciaga (Kering) will
start making face masks to ease shortages.
That comes after French perfume makers owned by LVMH started producing disinfectant gel and
Nivea-maker Beiersdorf started serial production of medical grade disinfectants.
Industrials are also adapting quickly with Dutch health technology company Philips ramping
up production of critical healthcare products to help diagnose and treat patients.
In other areas, production is severely slowed down or halted altogether: India's biggest
automaker Maruti Suzuki India and peers including Mahindra & Mahindra, Mercedes-Benz, Fiat
Chrysler Automobiles as well as Hyundai Motor Co said they will halt car production in the
country.
Measures taken to weather the storm are quite brutal and costly: Primark said it would close
all of its stores around the world, a loss of roughly 650 million pounds ($760 million) worth of
net sales a month.
The new normal is also that dividends and buybacks are becoming soooo 2019, to put things
lightly.
Shell joined the trend and suspended the next tranche of its share buyback plan. In the same
industry, Norway's Equinor has suspended its ongoing $5 billion share buyback programme.
Another name this morning to scrap a pay-out is Swedish home appliance maker Electrolux.
Airbus dropped its proposed 1.4 billion 2019 dividend, suspended funding to top up staff pension
schemes and withdrew its 2020 financial guidance.
French broadcaster TF1 has cancelled its guidance and the lack of financial forecast has
become a headache for analysts as we wrote earlier last week.
But no guidance is the new normal at the moment as we could see with the Financial Conduct
Authority saying on Saturday that Britain's listed companies should not publish preliminary
financial statements for at least two weeks to better assess the impact of coronavirus.

(Julien Ponthus)
*****


MORNING CALL: BRACE YOURSELF FOR A TOUGH OPEN (0630 GMT)
It just doesn't look good: U.S. futures are trading well in the red this morning and their
European peers are losing between 4% and 5% with less than two hours to go before the open.
Of course, there was a stage earlier when the losses were even steeper but there's clearly
no change in sentiment in sight.
Another sign of the low mood are retreating oil prices.
Asian markets sustained heavy losses overnight with the MSCI index of Asia-Pacific shares
outside Japan down 5%.
"This sell-off in Asia, which took its cues from the slide in the US on Friday, is likely to
see huge falls in European markets when they open later this morning", wrote CMC analyst Michael
Hewson in his morning note.
The policy response to the virus is however still building but whether it's enough or
quickly enough to reassure investors is another matter.
The European Commission next week is likely to present a tool for the euro zone's ESM
bailout fund to fight the effects of the epidemic that could unlock unlimited ECB sovereign bond
purchases, Vice President Valdis Dombrovskis told Reuters.
In the U.S. the senate's drive to pass a $1-trillion-plus coronavirus response bill remained
stymied late on Sunday, as Democrats held out for more money to help state and local governments
and hospitals, while Republicans urged quick action to give financial markets a sign of
encouragement.
(Julien Ponthus)
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(Reporting by Danilo Masoni, Joice Alves, Julien Ponthus and Thyagaraju Adinarayan)