Before the bell: Consumer Confidence Slumps

Consumer sentiment drops sharply in the U.S., while business confidence in Germany is on the rise.

Both the S&P 500 (+0.2%) and the Nasdaq (+0.5%) posted modest gains yesterday. Investors appear more optimistic than consumers, however, as the data published by the Conference Board paints a bleak picture. U.S. consumer confidence declined for the fourth consecutive month. The index now stands at 92.9, down from 100.1 last month. The expectations component—covering income and employment—fell 9.6 points to 65.2, its lowest level in 12 years. A reading below 80 is typically seen as a precursor to a recession. There are no such recession worries in Germany. Business confidence there has improved, giving the German market a boost. The DAX index closed 1.1% higher yesterday. Bayer (+5.2%) recouped much of its Monday losses. On the Brussels exchange, holding company Floridienne (+5%) made a strong showing. Water treatment company Ekopak (-6.7%) appears to have lost investor trust.

In Japan, stocks are up this morning by an average of 0.7%. Konica Minolta (+5.5%) and Nintendo (+5.6%) are doing even better. In Hong Kong, the index is up 0.2%. Geely Automobile, Lenovo, and BYD are each gaining around 2%. Later today, after market close, the National Bank of Belgium and investment firm Sofina will release their annual results. While the bank is expected to post a loss, we assume Sofina will report a rise in its net asset value.

Tessender-low

We already knew 2024 wasn’t a great year for Tessenderlo. If you’re a shareholder in the industrial holding company, you’ve certainly felt the impact. At the end of 2023, Tessenderlo’s share price was still above 28 euro. Yesterday, it stood at 23 euro, and in December it briefly dipped to 18.5 euro. Mea culpa. Sorry! Expectations had pointed to a decline in operating profit of 15 to 20%. It ended up being -16.7%. Despite its investments, dividend payments, and share buybacks, the company still managed to maintain a net cash position of 5 million euro. A gross dividend of 0.75 euro per share will again be paid. We’re looking ahead, and we still believe in the value and potential of Luc Tack’s company.

So Fine

I suspect I’ll be picking up a few more Sofina shares this morning. At 17:45 CET, the Boël family holding company will publish its results. I’m not particularly interested in how much more or less dividend income the firm received in 2024. What I care about is the net asset value management assigns to the company. In the January 21 newsletter, Sofina stated it was worth 10.1 billion euro, or 307 euro per share. But that figure didn’t yet include the updated valuations of the roughly 600 private equity funds Sofina has invested in. We’ll get a better picture of that later today. According to ING, Sofina is worth 392 euro per share. The current market price is 241.80 euro, representing a 38% discount. That seems too steep. Can you blame me for itching to buy?

Did you know…

that Elia published the details of its capital increase this morning? The high-voltage grid operator will issue new shares at 61.88 euro. For every 4 shares held, shareholders—both large and small—can subscribe to 1 new share. Elia’s share price closed at 82 euro yesterday.

This article was translated from Dutch and was originally published on Spaarvarkens.be.