US-EU Index Rebalances / Quantitative Researcher, Ortex

Dimitris Ioannidis

US-EU Index Rebalances / Quantitative Researcher

Global Financial Data and Analytics Platform

Ortex

ORTEX is a global financial data and analytics platform providing real-time securities lending and short interest data, index rebalance data, holdings and insider transactions, trading signals, corporate actions and news,  stock machine learning and factor scores and other analytics. The majority of the data are downloadable and accessible through APIs.

Event-Driven

<ul>
<li>The UK government has more than halved its stake in <a href="https://www.smartkarma.com/entities/natwest-group-plc" target="_blank" data-smartkarma-citation="entities:21008:1" rel="noopener">NatWest Group (NWG LN)</a> over the last two years reflecting an improving financial health for the lender.</li>
<li>The UK government is a strategic shareholder and the selling is forecasted to cause a passive fund demand in the next two months across four indices.</li>
<li>At close of 20 September 2024, the aggregate passive fund demand for <a href="https://www.smartkarma.com/entities/natwest-group-plc" target="_blank" data-smartkarma-citation="entities:21008:1" rel="noopener">NatWest Group (NWG LN)</a> is currently estimated at 22.8m shares, $95.7m and 0.73 days of volume.</li>
</ul>


The UK government has more than halved its stake in NatWest Group (NWG LN) over the last two years reflecting an improving financial health for the lender.
The UK government is a strategic shareholder and the selling is forecasted to cause a passive fund demand in the next two months across four indices.
At close of 20 September 2024, the aggregate passive fund demand for NatWest Group (NWG LN) is currently estimated at 22.8m shares, $95.7m and 0.73 days of volume.


NatWest (NWG): Passive Push from UK Government

Leading International Investment Research, Edison Investment Research

Edison Investment Research

Leading International Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

Equity Bottom-Up

<p>Q423 earnings demonstrated the inherent profitability and resilience of returns at NatWest Group (NWG). PBT came in 25% ahead of consensus, with beats on both revenues and impairments along with good cost control. Despite continuing normalisation of credit and assuming around two more base rate cuts in 2024 than are currently priced into the bond market, management expects to deliver a return on tangible equity (RoTE) of c 12%. On consensus estimates, the shares trade at 0.8x tangible net asset value (TNAV) and P/E of 6.4x in 2024e. Without a re-rating, the consensus 10% TNAV growth and 6.4% yield imply a 16.4% 12-month total return.</p>

Q423 earnings demonstrated the inherent profitability and resilience of returns at NatWest Group (NWG). PBT came in 25% ahead of consensus, with beats on both revenues and impairments along with good cost control. Despite continuing normalisation of credit and assuming around two more base rate cuts in 2024 than are currently priced into the bond market, management expects to deliver a return on tangible equity (RoTE) of c 12%. On consensus estimates, the shares trade at 0.8x tangible net asset value (TNAV) and P/E of 6.4x in 2024e. Without a re-rating, the consensus 10% TNAV growth and 6.4% yield imply a 16.4% 12-month total return.

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

iShares MSCI ACWI ETF / Technical Analysis

<ul>
<li>With the MSCI ACWI (ACWI-US) approaching the top-end of our expected 2023 trading range at $93, we see limited upside from here, and we believe caution is warranted.</li>
<li>We want to remain overweight Europe and the UK, but we prefer to buy only on pullbacks.</li>
<li>The Hang Seng and MSCI China (MCHI-US) are both getting rejected at their important resistances discussed last week, and we would expect to see a basing process develop below resistance.</li>
</ul>


With the MSCI ACWI (ACWI-US) approaching the top-end of our expected 2023 trading range at $93, we see limited upside from here, and we believe caution is warranted.
We want to remain overweight Europe and the UK, but we prefer to buy only on pullbacks.
The Hang Seng and MSCI China (MCHI-US) are both getting rejected at their important resistances discussed last week, and we would expect to see a basing process develop below resistance.


Caution Warranted; ACWI-US At $93 Resistance; Buys in Communications, Staples, Materials, Financials

European Event-Driven Analyst

Jesus Rodriguez Aguilar

Coca-Cola Europacific Partners / Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/coca-cola-europacific-partners-plc" target="_blank" data-smartkarma-citation="entities:44040:1" rel="noopener">Coca-Cola Europacific Partners (CCEP LN)</a>, the leading global Coca-Cola bottler, has requested changing its listing category on the London Stock Exchange, aiming a spot in the FTSE 100.</li>
<li>CCEP would be the 25th largest company of the index, therefore there is a strong likelihood that CCEP could enter the FTSE 100 in the upcoming review.</li>
<li>Passive funds would need roughly 83 trading days of average volume to fully allocate the necessary shares to match the index weighting.</li>
</ul>



Coca-Cola Europacific Partners (CCEP LN), the leading global Coca-Cola bottler, has requested changing its listing category on the London Stock Exchange, aiming a spot in the FTSE 100.
CCEP would be the 25th largest company of the index, therefore there is a strong likelihood that CCEP could enter the FTSE 100 in the upcoming review.
Passive funds would need roughly 83 trading days of average volume to fully allocate the necessary shares to match the index weighting.


Coca-Cola Europacific Partners: Aiming FTSE 100 Inclusion

<ul>
<li>
<a href="https://www.smartkarma.com/entities/aib-group-plc" target="_blank" data-smartkarma-citation="entities:43916:1" rel="noopener">AIB Group (AIBG IE)</a> is expected to experience an increase in free float from 75% to 80% in November 2024 due to the Irish Government reducing its stake this month.</li>
<li>
<a href="https://www.smartkarma.com/entities/commerzbank-ag" target="_blank" data-smartkarma-citation="entities:21596:1" rel="noopener">Commerzbank AG (CBK GR)</a> is forecasted to have a ~2% points free float <em>decrease</em> in Global and European Indices as <a href="https://www.smartkarma.com/entities/unicredit-spa" target="_blank" data-smartkarma-citation="entities:21234:1" rel="noopener">UniCredit</a> bought more than what the German Government sold.</li>
<li>The UK Government continues slashing its stake in <a href="https://www.smartkarma.com/entities/natwest-group-plc" target="_blank" data-smartkarma-citation="entities:21008:1" rel="noopener">NatWest Group (NWG LN)</a> with potential further free float increases coming in November and December 2024.</li>
</ul>



AIB Group (AIBG IE) is expected to experience an increase in free float from 75% to 80% in November 2024 due to the Irish Government reducing its stake this month.

Commerzbank AG (CBK GR) is forecasted to have a ~2% points free float decrease in Global and European Indices as UniCredit bought more than what the German Government sold.
The UK Government continues slashing its stake in NatWest Group (NWG LN) with potential further free float increases coming in November and December 2024.


European Governments' Bank Sell-Off: Boosting Confidence and Occasionally Free Float

United Kingdom

NatWest Group plc operates as a banking and financial services company. The Bank provides personal and business banking, consumer loans, asset and invoice finances, commercial and residential mortgages, credit cards, and financial planning services, as well as life, personal, and income protection insurance. NatWest Group serves clients worldwide.

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NatWest Group (NWG LN)

NatWest (NWG): Passive Push from UK Government

The UK Government is a strategic shareholder hence its reducing stake in NatWest is forecasted to cause a free float increase and generate passive...

Dimitris Ioannidis

NatWest Group - Time for a re-rating?

Q423 earnings demonstrated the inherent profitability and resilience of returns at NatWest Group (NWG). PBT came in 25% ahead of consensus, with...

Edison Investment Research

Caution Warranted; ACWI-US At $93 Resistance; Buys in Communications, Staples, Materials, Financials

With the MSCI $ACWI approaching the top-end of our expected 2023 trading range at $93, we see limited upside from here and believe caution is...

Vermilion Research

Coca-Cola Europacific Partners: Aiming FTSE 100 Inclusion

Coca-Cola Europacific Partners (CCEP LN), the leading global Coca-Cola bottler, has requested changing its listing category on the London Stock...

Jesus Rodriguez Aguilar

European Governments' Bank Sell-Off: Boosting Confidence and Occasionally Free Float

European governments are reducing stakes in AIB Group, Commerzbank AG, and NatWest, and triggering changes in free float percentages for European...

Dimitris Ioannidis

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

NatWest (NWG): Passive Push from UK Government

The UK Government is a strategic shareholder hence its reducing stake in NatWest is forecasted to cause a free float increase and generate passive...

Dimitris Ioannidis

NatWest Group - Time for a re-rating?

Q423 earnings demonstrated the inherent profitability and resilience of returns at NatWest Group (NWG). PBT came in 25% ahead of consensus, with...

Edison Investment Research

Caution Warranted; ACWI-US At $93 Resistance; Buys in Communications, Staples, Materials, Financials

With the MSCI $ACWI approaching the top-end of our expected 2023 trading range at $93, we see limited upside from here and believe caution is...

Vermilion Research

Coca-Cola Europacific Partners: Aiming FTSE 100 Inclusion

Coca-Cola Europacific Partners (CCEP LN), the leading global Coca-Cola bottler, has requested changing its listing category on the London Stock...

Jesus Rodriguez Aguilar

European Governments' Bank Sell-Off: Boosting Confidence and Occasionally Free Float

​European governments are reducing stakes in AIB Group, Commerzbank AG, and NatWest, and triggering changes in free float percentages for European...

Dimitris Ioannidis

European governments are reducing stakes in AIB Group, Commerzbank AG, and NatWest, and triggering changes in free float percentages for European...