James Halstead reports robust UK and North American markets

Investing.com -- Quantum Blockchain Technologies (AIM:QBT) has signed non-disclosure agreements with three ASIC manufacturers as part of its effort to commercialize its Bitcoin mining software products, the company announced Friday.

The AIM-listed investment company said these manufacturers will now need to make their mining rigs available to QBT’s testing team at its Milan laboratory, along with access to their source code.

This will allow QBT to install the software version of its Method C AI Oracle, which was launched on November 12, onto the third-party mining rigs.

QBT had previously begun joint analysis of the hardware version of Method C AI Oracle with one of these manufacturers, as announced on April 8. However, since integrating the hardware version into ASIC architecture could take up to 18 months, both parties agreed to prioritize the software version for faster commercial deployment.

The company has also signed an NDA with a Bitcoin mining pool, aiming to help pool nodes generate better quality hash rates to mine more Bitcoin. This approach could potentially bypass the need to modify the operating systems of all mining rigs using the pool.

Regarding patent applications, QBT is working with patent lawyers to respond to queries from examiners in Europe and the US, which it described as standard procedure for most patent applications.

Additionally, QBT is collaborating with a startup that designs mining solutions around the Blockscale Intel ASIC to test the validity of the company’s Methods A, B, and C across various SHA-256 implementations.

Francesco Gardin, CEO and Executive Chairman, said: "The Company is now engaged with the ASIC manufacturers it has been targeting over the past year. The Board believe QBT’s technology proposition is unique within the Bitcoin industry, which is the main reason why there is such a high level of interest from mining companies assessing our technology."

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Investing.com -- J.P. Morgan on Friday initiated coverage of UK food-to-go chain Greggs (LON:GRG) with an “overweight” rating and a 2,110p December 2027 price target, implying about 35% upside from the stock’s 1,590p close on Dec. 4, citing a valuation that has fallen to trough levels despite what it describes as sector-leading operating metrics and clear catalysts for recovery.

The brokerage said Greggs’ investment case stands on three pillars: structurally strong unit economics, a reset share price that has dropped 40% year-to-date while consensus earnings expectations fell 15%, and the potential for earnings and free cash flow to inflect from fiscal 2026 as new distribution capacity comes online. 

The analysts said the shares trade at about 40% discount to the company’s 10-year historical averages on P/E, EV/EBITDA and EV/Sales, as well as at discounts to UK supermarkets and peers such as B&M, Zabka and Domino’s UK.

J.P. Morgan characterizes Greggs, a vertically integrated bakery and food-to-go retailer-as a “structural winner,” highlighting a 61.7% gross margin in 2024, roughly double peers’ 30-35% range, supported by in-house production and a focused range. 

Sales densities of £769 per square foot and underlying profit of £162 per square foot place the chain ahead of competitors including discounters and convenience operators, trailing only Aldi and Sainsbury’s convenience formats on profitability per square foot. Greggs’ return on invested capital sits above 20%, which the analysts describe as sector-leading.

The broker’s base-case model forecasts company-managed like-for-like sales of 2.3% in 2025 and 2.5% in 2026, rising to 3-3.5% thereafter. Gross margins are expected at 61.2% in 2026-27 before gradually improving to 61.8%. 

Underlying EBIT margin is projected to recover from 8.4% in 2025 to 8.5% in 2027 and approach 9.8% by 2030. Forecast diluted underlying EPS rises from 117.23p in 2025 to 236.68p by 2032. 

Capital expenditure is guided by management at high levels through 2026 due to new distribution centers at Derby and Kettering, peaking at £300 million in 2025 and normalizing toward 6% of revenue thereafter. 

Free cash flow is projected to shift from negative £64 million in 2025 to £109 million in 2027 and £205 million in 2029, reaching £228 million by 2032.

The analysts expect the two distribution centers to expand national capacity and support the company’s plan to grow from 2,618 stores to 3,000 by 2030. 

They said peak capex should not be treated as a permanent step-up in capital intensity and noted management sees room for material “white space” expansion, with low cannibalization from new openings. 

Greggs’ evening-trade contribution, now above 9% of company-managed sales, and growth in digital and delivery channels were also listed as incremental drivers.

J.P. Morgan’s bull-case valuation of 2,430p signals up to 53% upside, while its bear case of 1,340p indicates 16% downside, which the firm says underscores an asymmetric profile skewed toward gains.

Investing.com -- J.P. Morgan on Friday initiated coverage of UK food-to-go chain Greggs (LON:GRG) with an “overweight” rating and a 2,110p December 2027 price target, implying about 35% upside from the stock’s 1,590p close on Dec. 4, citing a valuation that has fallen to trough levels despite what it describes as sector-leading operating metrics and clear catalysts for recovery, sending shares up over 5%.

The brokerage said Greggs’ investment case stands on three pillars: structurally strong unit economics, a reset share price that has dropped 40% year-to-date while consensus earnings expectations fell 15%, and the potential for earnings and free cash flow to inflect from fiscal 2026 as new distribution capacity comes online. 

The analysts said the shares trade at about 40% discount to the company’s 10-year historical averages on P/E, EV/EBITDA and EV/Sales, as well as at discounts to UK supermarkets and peers such as B&M, Zabka and Domino’s UK.

J.P. Morgan characterizes Greggs , a vertically integrated bakery and food-to-go retailer-as a “structural winner,” highlighting a 61.7% gross margin in 2024, roughly double peers’ 30-35% range, supported by in-house production and a focused range. 

Sales densities of £769 per square foot and underlying profit of £162 per square foot place the chain ahead of competitors including discounters and convenience operators, trailing only Aldi and Sainsbury’s convenience formats on profitability per square foot. Greggs’ return on invested capital sits above 20%, which the analysts describe as sector-leading.

The broker’s base-case model forecasts company-managed like-for-like sales of 2.3% in 2025 and 2.5% in 2026, rising to 3-3.5% thereafter. Gross margins are expected at 61.2% in 2026-27 before gradually improving to 61.8%. 

Underlying EBIT margin is projected to recover from 8.4% in 2025 to 8.5% in 2027 and approach 9.8% by 2030. Forecast diluted underlying EPS rises from 117.23p in 2025 to 236.68p by 2032. 

Capital expenditure is guided by management at high levels through 2026 due to new distribution centers at Derby and Kettering, peaking at £300 million in 2025 and normalizing toward 6% of revenue thereafter. 

Free cash flow is projected to shift from negative £64 million in 2025 to £109 million in 2027 and £205 million in 2029, reaching £228 million by 2032.

The analysts expect the two distribution centers to expand national capacity and support the company’s plan to grow from 2,618 stores to 3,000 by 2030. 

They said peak capex should not be treated as a permanent step-up in capital intensity and noted management sees room for material “white space” expansion, with low cannibalization from new openings. 

Greggs’ evening-trade contribution, now above 9% of company-managed sales, and growth in digital and delivery channels were also listed as incremental drivers.

J.P. Morgan’s bull-case valuation of 2,430p signals up to 53% upside, while its bear case of 1,340p indicates 16% downside, which the firm says underscores an asymmetric profile skewed toward gains.

Investing.com - European stocks edged higher Friday, with sentiment upbeat ahead of the delayed release of the Federal Reserve’s favored inflation statistics, as a precursor to next week’s policy-setting meeting.

At 03:10 ET (08:10 GMT), the DAX index in Germany climbed 0.2%, the CAC 40 in France gained 0.2% and the FTSE 100 in the U.K. rose 0.1%. 

U.S. inflation due ahead of Fed meeting  

The U.S. Federal Reserve meets next week, and rate-cut expectations remain firm, buoying global sentiment, even after Thursday’s U.S. jobless claims fell to a three-year low, with economists saying the numbers were likely skewed by the Thanksgiving holiday. 

Questions over the health of the U.S. labor market remain key for the Fed policymakers, especially after the private ADP jobs report showed a surprise decline in payrolls for November. But they will also get key data later in the session pertaining to the second half of their dual mandate, with the delayed release of the PCE deflator, even if the data is for September.

Expectations of a quarter-point cut have surged in the past two weeks, with money markets now pricing in an 88% chance of policymakers trimming their key interest rate, according to the CME’s FedWatch tool.

German industrial orders rise

Back in Europe, German industrial orders rose more than expected in October, rising by 1.5% on the previous month, the federal statistics office said, ahead of the expected 0.4% gain.

Despite this relatively healthy release, Germany’s economic recovery will remain subdued next year as exports struggle and global trade slows, according to a forecast by the German Economic Institute IW, released earlier Friday. 

The IW forecasts Germany’s real gross domestic product to grow only slightly this year, by 0.1% after two years of contraction, before hitting 0.9% next year, marking a notable increase.

The final release of third-quarter growth in the eurozone is due for release later in the session, and is expected to confirm annual gross domestic product growth of 1.4%, with a quarterly gain of 0.2%.

The European Central Bank also meets later this month, but, unlike the Fed, is widely expected to keep interest rates unchanged at its final meeting of the year.

Swiss Re sees higher profit next year

In the European corporate sector, Swiss Re (SIX:SRENH) forecast higher net profit for 2026 and said it would launch a buyback program of $500 million.

The Zurich-based reinsurer said Friday that it expects to achieve net profit of $4.5 billion in 2026, above the net profit of more than $4.4 billion that it expats for teh current year.

Crude gains on Russian supply concerns

Oil prices steadied Friday, maintaining the previous session’s gains as stalled diplomatic progress over the Ukraine war and firm expectations of a U.S. Federal Reserve rate cut supported sentiment. 

Brent futures climbed 0.1% to $63.34 a barrel, and U.S. West Texas Intermediate crude futures rose 0.1% to $57.69 a barrel.

Both contracts jumped nearly 1% on Thursday, and while Brent was mostly unchanged this week, WTI was on track for a 1.5% weekly gain - a second straight week of increase.

The lack of progress in U.S.-Russia talks to end the Ukraine war has dampened hopes that energy sanctions on Russian crude could be eased soon, keeping a risk premium in the market.

Investing.com -- European oil and gas equities enter 2026 under a more cautious sector stance, with rating changes reflecting tighter valuations and pressure from projected oil oversupply, according to J.P. Morgan’s EU Oils 2026 Outlook dated Friday. 

The brokerage said that the sector has experienced “significant positive decoupling” in the second half of 2025, as EU oil stocks outperformed despite weakening crude benchmarks. Brent declined 7% during 2H 2025 while EU oils outperformed the broader European market by 6%.

The brokerage says valuations are now “full,” noting a 7.8% estimated 2026 free cash flow yield at $62/bbl Brent, which it describes as rich relative to long-term averages. 

Consensus forward P/E levels of around 10.3x leave the discount to the EU market near its 10-year average as the forward strip suggests Brent pricing near $60/bbl. 

JPM Commodities Research projects Brent below $60/bbl in 2026 and 2027 as oversupply builds.

J.P. Morgan maintains only two “overweight” ratings, namely, Shell, at 3,200p with 15% upside, and Repsol, at €18 with 11% upside. 

TotalEnergies was downgraded to “neutral” with a €55 price target and 3% downside, and Eni was downgraded to “underweight” at €15.5 with 4% downside. 

BP (target price 480p, upside 5%), Galp (target price €18, upside 3%), and Neste (target price €18, upside 5%) are all rated “neutral,”while Equinor (target price NOK 220, downside 5%) and OMV (target price €45, downside 6%) are rated “underweight.” Across the sector, average 2026 dividend yield is 5.7% and average upside potential is below 5%.

Shell, the report’s preferred supermajor, is cited for resilience and free-cash-flow strength, with an expected 2026 cash yield of 10.1% and sector-low dividend coverage near $40/bbl.

It also holds the deepest balance sheet at 20% ND/CE. Shell is supported by refining and marketing exposure that offers an oil-price hedge.

Repsol, the prime refining-led hedge, has the highest diesel leverage and a 6.1x 2026 P/E multiple. 

A 6.5% dividend yield and 40-50% operating profit contribution from refining and marketing support its positioning as diesel margins remain elevated.

Eni, one of the sector’s strongest 2025 performers, is downgraded on valuation pressure, rising gearing expectations and high sensitivity to upstream prices. 

J.P. Morgan forecasts Eni’s 2026-27 EPS 3% and 7% below consensus at forward strip conditions. An average 2026-27 P/E of 9.7x is noted as a premium to peers versus its historic 20% discount.

TotalEnergies is cited for limited valuation differentiation, lower refining hedge exposure of about 20% compared with more than 30% for UK majors, and Integrated Power not becoming free-cash-flow positive until 2027.

Diesel remains the strongest hedge in Europe, which is structurally short and sourcing 20% of annual demand from imports following the end of Russian inflows. Margins recently above $30-40/bbl underpin downstream support.