Source: Sharecast
UBS said it’s looking for a resilient Q1 for Inditex despite geopolitical challenges, with constant currency sales growth of 7.5% (Visible Alpa consensus 8.4%), suggesting a slight deceleration versus 9% for the current trading period.
Across the pond, quarterly numbers from Broadcom, CrowdStrike and Medtronic are due.
As far as Broadcom is concerned, AJ Bell analysts Danni Hewson and Russ Mould noted that this year it became the sixth company ever to hit the $2 trillion market cap threshold following its transformation from a cyclical semiconductor manufacturer to one of the leading lights of the AI infrastructure theme.
"Increasing evidence that the hyperscalers like Alphabet-owned Google and Meta, who are pouring hundreds of billions of dollars into AI, are looking to build their own chips is a potential threat to Nvidia’s dominance of this market to date," they said.
"Broadcom, in contrast, is a potential beneficiary as one of the main partners for many of these ‘build your own’ projects, and this has helped sustain the momentum behind the share price.
"Unlike its AI chip peer Nvidia, Broadcom derives meaningful recurring revenue from its software business which was augmented by the acquisition of VMware for $69 billion in November 2023.
"As hardware takes a bigger share of overall business there is some risk of pressure on margins given the former tends to be somewhat less profitable. There is also likely to be focus on the company’s ability to convert its hefty backlog of $73 billion of orders into recognised revenue."
On the macroeconomic calendar, the US ADP jobs report will be in the spotlight ahead of Friday’s payrolls.