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Good morning,

Markets are called to open lower this morning. The drop in the markets is caused by:

  • Industrial metals are falling as expanding stockpiles in China, the biggest consumer, add to a raft of data that signify a broad slowdown. The country’s lawmakers are meeting to set economic policy amid growing credit risks that saw the country’s first onshore bond default last week.
  • Better-than-estimated U.S. payrolls figures on March 7 bolstered the case for continued reductions in Federal Reserve stimulus.
  • In Crimea, Russian troops detained Ukrainian border guards amid an ongoing standoff as the region prepares a referendum on joining Russia.

Stock to watch: Adidas (Calamatta Cuschieri 12-month Price Target increase to €98.27)

We increased our price target on Adidas from €93.53 to €98.27 for the next 12-months. We are confident in the products the Group has on offer and believe they will do well in the coming years. Despite the negative currency headwinds, we don’t expect to see the same levels of weakness as we have seen till Q114.

We expect Adidas to perform better in H214. At this stage we are using the current weakness to cautiously add Adidas to our holdings. We believe that Adidas should be a core holding representing the retail sector. However, continued weakness in the stock has dented our long term confidence. We will keep monitoring the stock and adjust our model accordingly.

For a copy of our latest report on Adidas log onto webtrader or contact our offices on 25688688.

Companies in Europe reporting results today:

• Helvetia (HELN SW) 7am

• Iliad (ILD FP) TBD

• Symrise (SY1 GR) 7am

Companies we follow which report results later on this week:

  • Deutsche Post (wednesday – FY13 results out)
  • Deutsche Lufthansa (Thursday – FY13 results out)

Good day and happy trading!

Kristian Camenzuli