The main European stock markets were slightly up in the week from the 14th to the 18th of July, with the exception of Madrid (Milan +0.6%, London +0.9%, Frankfurt +0.6%, Paris +0.4%, Madrid -0.1%), supporting the DJ Stoxx 600 index monthly performance (+0.8%).
Investors turned to Bank stocks (+1.2%), recovering after the considerable losses of the previous week (-4.1%), mainly thanks to the positive news flow from Banco Espirito Santo (possible capital raise from new shareholder).
The Auto&Parts sector closed the week down 0.3%, influenced by mixed news from the car market. Europe shows positive signals, the monthly ACEA report shows a positive trend of +4.3% in June, the tenth consecutive month of recovery; less encouraging news from South America, where car registrations are decreasing.
Pirelli shares closed the week at 11,50 € (-1.8%) with limited volumes (1.7 million shares on average per day, against a 3-month average of 2.4 million) in line with the most important European peers (Continental -1.7%). Credit Suisse has initiated coverage of the stock with a buy recommendation and a target price of 14.50€, mainly thanks to the excellent Pirelli positioning in the Premium segment.
Consensus target price is at 13.0 €/share with 85% of analysts advising to Buy or Hold the shares.