EUROPEAN OPEN: ROP SW reports positive Phase II enicepatide results; KGF LN raises profit guidance; TUI1 GY narrows FY26 EBIT guidance; BVI FP raises revenue growth view; BAS GY explored potential EVK GY deal

EUROPEAN OPEN: European equities start the Tuesday session mixed. Overnight, APAC stocks mostly gained following the advances on Wall Street, where the Nasdaq outperformed and notched a record close as Meta shares surged over 11% on strong adoption of its Muse AI agent, and with AMD joining the USD 1tln market cap club; markets in Japan were closed again for the holidays. Crude futures are up, snapping a four-day decline, as traders weighed Middle East supply risks against diplomatic efforts to end the US-Iran war. December Brent is near USD 98/bbl as the European day starts. Libya’s NOC on Monday said an armed group closed valve 7 on the Sharara crude pipeline to Zawiya port, sharply reducing output at the oilfield. Elsewhere, Bloomberg reports that Saudi Aramco has informally told several Asian refiners that loadings from the Red Sea port of Yanbu may resume soon; Yanbu loadings have been largely halted since the East-West pipeline was attacked on 10th September. Copper rose for a sixth day as falling inventories and pre-holiday buying tightened physical supply in China; Shanghai copper cathode inventories fell to the lowest since 2023. Gold edged lower; bullion starts the European day around USD 4,330/oz. Bitcoin prices eased after reaching an eight-month high on Monday; liquidations across digital assets exceeded USD 1bln over 24 hours, including about USD 840mln of short positions, while ETF inflows and Strategy’s renewed Bitcoin purchases supported sentiment, Bloomberg said. On the EU trade front, China Foreign Minister Wang Yi said that China and the EU should avoid a trade confrontation and resolve disputes through dialogue. The EU and Philippines agreed a free trade deal aimed at strengthening and diversifying supply chains. India and the Visegrad Group countries (Czech Republic, Hungary, Poland and Slovakia) held their first joint ministerial meeting, discussing defence, security, space, connectivity and mobility, while the V4 countries also backed India’s bid for permanent UN Security Council membership. In EU politics, German Chancellor Merz’s political weakness is complicating negotiations over the EU’s proposed EUR 2tln 2028-34 budget, according to the FT. Officials said Germany may struggle to broker compromises after CDU regional election losses. Merz has pushed for several hundred billion Euros of cuts; failure to reach agreement by year-end could delay preparations for 2028 funding. Afterhours on Monday, ECB Chief Economist Lane said the Eurozone economy should continue growing at a steady but moderate pace if the energy shock does not worsen; he added that a second wave of energy-price increases will lift inflation before it declines towards target from mid-2027. In data, UK public sector borrowing (ex-banks) reached GBP 18.3bln in August (exp. 15.7bln; prev. 2.0bln); borrowing has totalled GBP 77.3bln in the first five months of the fiscal year, GBP 8.1bln above the OBR’s March forecast, increasing pressure on Chancellor Healey ahead of next month’s budget. Focus today will be on commentary from the UN, where President Trump will meet UK PM Burnham, French President Macron, Ukraine President Zelensky, Gulf leaders. Italy will also provide an update on its 2025 Budget Deficit. STOCK SPECIFICS: Of note for UK companies, UK trade unions have sharply increased applications for formal bargaining rights after Labour eased recognition rules, according to Bloomberg; cases have more than doubled vs year earlier. From 30th October, employers must also give unions workplace access to recruit members, potentially accelerating recognition efforts. HEALTHCARE: Roche (ROP SW) reported positive Phase II results for dual GLP-1/GIP agonist enicepatide in type 2 diabetes and overweight or obesity, meeting both primary endpoints. The European Commission also approved Susvimo for neovascular age-related macular degeneration. CONSUMER CYCLICAL: On Holdings (ONON) targets high-teens constant-currency sales growth through 2029, with net sales of at least CHF 5.6bln and adj. EBITDA margin of at least 22%, according to Bloomberg. It also authorised its first share buyback, up to USD 1bln through 2029, while expanding into football and golf and targeting gross margin of at least 65%. Kingfisher (KGF LN) H1 2026/27 sales GBP 6.86bln, adj. pretax profit GBP 404mln, LFL sales growth 0.1%; raised FY 2026/27 adj. PBT guidance to GBP 595-635mln (prev. saw 656-625mln), and FCF view to GBP 480-520mln; declared a 3.8p/shr interim dividend. TUI (TUI1 GY) narrowed its FY26 underlying EBIT guidance to EUR 1.2-1.3bln (prev. saw 1.1-1.4bln) and said it remains on track for robust performance; revenue guidance stays suspended. INDUSTRIALS: Of note for UK defence names, UK PM Burnham will reportedly announce a new UK-US AI defence partnership aimed at improving protection of critical infrastructure and threat detection. Japan Airlines is reportedly leaning towards Embraer (EMBJ) over Airbus (AIR FP) for an order of about 20 regional jets; JAL is weighing Embraer’s E2 against Airbus’s A220, and could decide as soon as October, though no decision is final. Bureau Veritas (BVI FP) raised its 2027-2028 total revenue CAGR target to double-digit growth (from high-single-digits) and narrowed its leverage target to 1.5-2x (from 1-2x); it also targets EUR 1bln of revenue from AI-driven markets and services by 2030. * Smiths Group (SMIN LN) - FY26 revenue GBP 1.94bln, operating profit of GBP 399mln, both higher Y/Y; raised its dividend to 48.5p/shr (exp. 48p), and sees FY27 organic revenue growth of around 4%, with a headline operating margin of around 21%. Rentokil (RTO LN) agreed to sell SOLitude Lake Management and its Vertex Aquatic Solutions division to Bain Capital for USD 230mln on a cash-free, debt-free basis. MATERIALS: BASF (BAS GY) explored a potential deal with Evonik Industries (EVK GY) earlier in 2026, according to Dealreporter; one source downplayed the likelihood of a transaction, citing BASF’s constrained cash position. ENERGY: BP (BP/ LN) said its Whiting refinery (440k BPD capacity) has returned to normal operations following planned maintenance last week. FINANCIALS: Of note for UK pension companies, the Investment Association urged the UK government to avoid frequent changes to savings, investment and pensions policy ahead of the 28th October budget; it opposed further Capital Gains Tax increases, called for preserving tax-free ISAs and urged abolition of Stamp Duty on shares to encourage investment in UK-listed companies. REAL ESTATE: Of note for the UK construction sector, Labour is considering exempting borrowing by public development corporations from UK fiscal rules to boost infrastructure and housebuilding; the proposal could allow bond-funded investment in land, transport, housing and energy without increasing sovereign borrowing. NOTABLE BROKER UPDATES: Danone (BN FP) upgraded at Deutsche Bank; Engie (ENGI FP) upgraded at Societe Generale; Fortum (FORTUM FH) upgraded at Carnegie Securities. LVMH (MC FP) downgraded at RBC; Burberry (BRBY LN) downgraded at RBC; Ericsson (ERICB SS) downgraded at Morgan Stanley. DAY AHEAD: EVENTS: The UN General Assembly General Debate opens, with Presidents Trump and Macron and UK PM Burnham among those addressing the floor; Trump meets separately on the sidelines with Ukrainian President Zelensky (18:15BST/13:15EDT), UK PM Burnham (16:15BST/11:45EDT), Japan PM Takaichi (17:30BST/12:30EDT) and Gulf leaders (19:45BST/14:45EDT), Venezuela Acting President (00:40BST/19:40EDT). Elsewhere, the USTR will hold a hearing regarding the Section 301 investigation into Germany’s pharmaceutical policies today. DATA: In Europe, Eurozone flash consumer confidence data is due (prev. -15.5). Italy releases its 2025 deficit update. In North America, US Richmond Fed manufacturing index (prev. 4), and the weekly ADP employment stats are released (prev. 16.25K). CENTRAL BANKS: Fed’s Williams (voter) delivers a keynote at the Treasury conference; Fed’s Jefferson (voter) speaks on Discount Window modernisation and Treasury market functioning; Fed’s Barkin (2027 voter) speaks on the policy and economic outlook. ECB President Lagarde (neutral) gives a pre-recorded video address (no text); ECB’s Nagel (hawk) speaks twice through the day. Hungary’s NBH expected to hold (exp. 5.5%, prev. 5.5%). SUPPLY: US sells USD 69bln of 2-year notes; UK auctions GBP 4.75bln of 2032 debt; Germany auctions EUR 5bln of 2031 Bobls. ENERGY: WTI October 2026 futures expire. After the US close, weekly API inventory stats are due. EARNINGS: Notable corporates reporting today include: AutoZone (AZO).