Citi says CaixaBank underperformance doesn’t match deposit-risk concerns

The latest Market Talks covering Equities. Published exclusively on Dow Jones Newswires throughout the day. 0737 GMT - EU approval for MMG's acquisition of Anglo American's Brazilian nickel business would be "the very best outcome" for European stainless steel customers and for the company's workers in Brazil, the London-listed mining company's chief operating officer Ruben Fernandes says. His comments come on the back of a closed-door hearing with EU merger officials Thursday, who have raised concerns the transaction could divert supplies from Europe to China. "Prohibition means that we will head towards 'care and maintenance' as the pathway to closure of the operations in Brazil. That would be the ultimate lose-lose outcome," he says, adding that Anglo American presented "the clear realities of the market during the hearing."(edith.hancock@wsj.com) 0732 GMT - CaixaBank shows little sign of weakening in its underlying business, despite the share price underperforming recently compared to peers, Citi analysts write. Shares in the Spanish bank have fallen over the past month, after management made cautious comments on deposit growth. However, the bank continues to gain market share across key products, and its earnings per share are less sensitive to a weakening in deposit growth than some peers, the analysts say. "In our view, the magnitude of [CaixaBank's] underperformance appears inconsistent with the relative earnings risk implied by our stressed deposit scenarios," Citi notes. Shares are up 0.8% but have fallen 9.1% during the last month. (michael.hennessey@wsj.com) 0718 GMT - European stock indexes rise at the open, buoyed by a pullback in bond yields and an easing in oil prices. Banking, software and energy-intensive stocks trade up, lifting the Stoxx 600 0.8% higher. London's FTSE 100 rises 0.8%. Miners in the index gain as metals prices advance, while software group Relx is up 2.7%. The German DAX adds 0.6%, led by a 2.8% jump for software giant SAP. Deutsche Telekom tumbles 7%, however, after SpaceX accelerated its efforts to build a mobile network. In Paris, the CAC 40 jumps 0.8% as luxuries strengthen, though Orange--down 2.6%--drags the index. Italy's FTSE MIB gains 0.9%, while the Spanish IBEX 35 adds 0.1%. The Dutch AEX rises 0.6%, though ASML slips 0.9%.(josephmichael.stonor@wsj.com) 0717 GMT - U.K. grocer Tesco's recent update provides a constructive read-across for peer Sainsbury's, when it comes to margin outlook, analysts at J.P. Morgan say in a note. Sainsbury's is like Tesco in that the analysts are confident that it can deliver margin expansion coupled with retail profit growth on-year in first-half results, they say. (aimee.look@wsj.com) 0701 GMT - British energy major BP's deleveraging efforts are ahead of plan, Baader Helvea's Frederic Lorec writes, as he upgrades the stock's target price to 636 pence from 549 pence. He also upgrades the adjusted earnings per share forecast to $1.17 in 2026 and $0.81 in 2027, from $0