Before the bell: Focus on the ECB

Trump keeps playing games with the world, but Canada strikes back hard. Plenty of corporate news on the Brussels stock exchange.

A small celebration took place on Wall Street yesterday. President Trump decided to temporarily delay the 25% tariffs on Mexican and Canadian cars. Companies like Ford (+5.8%), General Motors (+7.2%), and Stellantis (+4.5%) were among the winners. However, the S&P 500’s 1.1% recovery may be short-lived. Canada has already stated that it will not adjust its new tariffs on American products unless the U.S. also withdraws the other newly imposed tariffs. In Asia, the rally continues, particularly among Chinese technology companies. The Hang Seng Index has already gained 23.8% this year, rising by another 3% today. Alibaba is up 7.8% on the Hong Kong stock exchange.

Today, investors will focus mainly on the ECB’s interest rate decision. Markets have priced in a 25-basis-point rate cut. Additionally, investors can react to plenty of corporate news. Barco has announced a 60 million euro share buyback program, which, at the current stock price, accounts for more than 5% of outstanding shares. Care Property Invest saw its profit rise but warned that net debt will increase in 2025. Compagnie du Bois Sauvage reported a 70 million euro loss due to a significant write-down of its stake in Umicore. Chemical producer Solvay saw its net profit drop by 25% and does not expect a significant recovery in 2025. GBL is looking to sell part of its shares in the Swiss inspection company SGS, which is the largest holding in the Belgian portfolio. Today, JD.com and Kroger will report earnings, along with Broadcom and Costco.

The Hidden Greek

The Brussels stock exchange has several Greek companies that operate under the radar. Cement giant Titan Cement is one of them, but another is Cenergy Holdings, which has its headquarters in Belgium. This specialist in cables and steel pipes receives too little attention from investors, in our view. With revenue of 1.8 billion euro and a market capitalization of nearly 2 billion euro, it is one of the largest companies on the Brussels stock exchange, with a market value nearly seven times that of Deceuninck. Yesterday, the company once again published excellent annual results, with net profit increasing by 91% to 139.4 million euro. The debt ratio is barely 1x EBITDA, and the order book is well-stocked at 3.44 billion euro. Yet, this company remains largely unnoticed on the Brussels stock exchange. And yet, it is one of the strongest performers on our market. Over the past five years, the top stock Lotus Bakeries has risen by 200%, but Cenergy Holdings has climbed by 847% in just five years. Maybe it’s time to start learning Greek? Although, fortunately, the company’s annual reports are in English.

How Long Is the Skirt?

Who still remembers the Hemline Index? We first learned about this partly anecdotal economic theory from economist George Taylor in the 1920s during our school days. In Belgium, this index is better known as the “zoom index,” which suggests that skirt lengths get shorter during economic growth and longer during recessions. This morning, we had a reason to take a close look at the figures from lingerie producer Victoria’s Secret—could lingerie sales tell us something about the state of the economy, just like the Hemline Index? Investors will soon be able to react to the company’s results, which showed both higher-than-expected revenue and profit. But what caught our attention? The 1% revenue increase may have exceeded expectations, but it is hardly significant. Is this a sign that we are heading toward a crisis? As researchers, we are still undecided—giving us an excuse to dive deeper into this topic over the weekend. Of course, we are referring to the Hemline Index.

Did You Know…

Mark Zuckerberg will receive a dividend of 179,942,692.12 dollar from Meta in just 20 days? Since Meta pays quarterly dividends, his annual dividend income exceeds 719 million dollar.

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