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Auto & Transport Roundup: Market Talk

17 Nov 2017 9:20 am

The latest Market Talks covering the Auto and Transport sector. Published exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.

0807 GMT - British budget airline easyJet reports full-year results Tuesday. Having already provided much detail in a trading update last month, Goodbody sees more focus on the day on the outlook for the start of the airline's 2018 financial year that began in October. Goodbody expects 1H per-seat revenue guidance for low to mid-single digit growth. Also the cost outlook for 2018 will garner lots of attention, says Goodbody. EasyJet shares open Friday 0.46% up. (robert.wall@wsj.com)

1101 GMT - Early strength in Korean stocks didn't last and fully gave way at the close. Trading slightly higher throughout the afternoon, an end-of-day adjustment resulted in the Kospi finishing down 0.80 point at 2533.99, ending at session lows. Transportation fell 1.3% as Hyundai Motor slid 1.6%. Samsung, up some 2% early one, ended just 0.1% higher. (minsun.lee@wsj.com)

0619 GMT - After this year's improvement in China's heavy-duty truck market, Goldman Sachs says sustainability is a question after October's volume growth slowed to 31% from a year earlier versus September's 91%. As such, it downgrades Sinotruk to sell even after shares have fallen 26% from last month's 10-year high. The stock more than doubled between June and October, and in light of that Goldman's price target jumps 81% to HK$7.64. Sinotruk is down 4.7% at HK$8.77. (john.wu@wsj.com)

0221 GMT - Cummins plans to invest $500M in electric-powertrain development for trucks, buses and other commercial vehicles the next 3 years. "We are moving on this technology with speed and agility," CEO Tom Linebarger told investors. The engine maker is pursuing the same strategy it uses with diesel by selling electric powertrains and components to a variety of vehicle assemblers rather than building vehicles itself. Cummins says that gives the company the flexibility to pivot into vehicle markets that show promise. Cummins still expects its flagship line of diesel engines to be money-makers for years to come. (robert.tita@wsj.com; @bob_tita)

0318 GMT - China's antitrust review of the port sector, which includes tariff cuts of 10-20% at some major facilities next year, will hit China Merchants much more than Cosco Shipping Ports, says Daiwa. It estimates 48% of the former's volume is at the 4 facilities which will see the tariff cuts, versus 17% for Cosco. After falling 7.3% yesterday, China Merchants is down another 1.2%. But Cosco Shipping Ports rebounds 3.4% after its 7.9% slide. (john.wu@wsj.com)

0312 GMT - While Southeast Asian airports handled more passengers than China and India combined last year, the share of outbound passengers was half of China's, notes Nomura. That suggests "upside potential." The investment bank says Southeast Asia's annual air-passenger traffic may rise to 2.21 billion by 2036; it was 654 million last year. It predicts more than $73 billion of airport infrastructure will be needed the next 20 years. (gaurav.raghuvanshi@wsj.com)

0201 GMT - It isn't the end of the world for Cathay Pacific, which is about to leave Hong Kong's stock benchmark. The airline said late Thursday that cargo demand continued to recover, helped by the launch of new smartphones and robust demand for perishables. During the month, Cathay broke its weekly tonnage uplift record. Meanwhile, passenger traffic rose 6% last month after falling 1.2% in September. Shares rise 2%, cutting the week's index news-fueled slide to 2.6%. (joanne.chiu@wsj.com; @joannechiuhk)

0144 GMT - To ride on the success of the new Myvi, an affordable and locally popular Malaysian car made by Perodua, Maybank highlights 23%-owner MBM. It also suggests buying Pecca as it's the sole supplier of leather-seat covers to Perodua. The partial unveiling of Perodua's 3rd-generation Myvi at a local auto show last weekend saw dealers rack up 5,000 pre-orders ahead of yesterday's official launch. The car has been popular within the country due to its affordable pricing and compact size. MBM is up 3.3% this week while Pecca has jumped 5.4%; both are modestly higher this morning.(yantoultra.ngui@wsj.com; @yantoultra)

2304 GMT - US airlines continued to show improvement on involuntarily bumping customers off overbooked flights in 3Q. For the 12 carriers which give the government such data, 1.5 of every 100,000 passengers were bumped, the least since the Transportation Department began collecting such information in 1995. That compares to 6.9 a year earlier and far below the prior rate of 4.4 this spring. Summer is the busiest season for US airlines, with capacity rising with increased travel. But be it less overbookings occurring or sweetened offers to get passengers to give up their seats, bumps were rare last quarter. (kevin.kingsbury@wsj.com; @kevinkingsbury)

2330 GMT - Australian freight-rail operator Aurizon appears to be moving more strategically, says Macquarie, with moves such as recently disclosed talks to work with other investors to restructure port and coal operations around Wiggins Island. The investment bank notes current volumes hauled by the company are strong, which is leading to efficiency improvements. And with a A$5.33 price target, Macquarie upgrades Aurizon to outperform. Shares jump 2.4% to A$5.18, erasing the month's pullback. (robb.stewart@wsj.com; @RobbMStewart)

2031 GMT - Mark Dunkerley, an Englishman who has run Hawaiian Holdings for 15 years, suddenly announced his retirement, to be replaced by Peter Ingram, EVP and chief commercial officer, effective March 1. Ingram joined in 2005 just after Hawaiian's second bankruptcy proceeding ended. Dunkerley was the force behind the airline's big push into Asia. Hawaiian shares ended up 4.8% to $38.85. (susan.carey@wsj.com)

1653 GMT - Boeing clarifies that the 32 cancelled 737 Max orders reflect those made by collapsed UK charter specialist Monarch Airlines. Boeing's latest order update also includes cancellations for eight 787 Dreamliners for unidentified customers, alongside 22 new orders. It announced an order from Kazakhstan's Scat Airlines for six 737 Max jets on the final day of the Dubai Airshow, lifting the amount of potential deals announced during the show to 302 aircraft. (doug.cameron@wsj.com; @dougcameron)

(END) Dow Jones Newswires

November 17, 2017 04:20 ET (09:20 GMT)

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