JPM expects US business services market to stabilise before Europe

Spie SA

05/12/2024 11:00

** J.P.Morgan expects the U.S. business services market to
stabilise, while warning of clouded outlook especially in France
and Germany due to weakening macro conditions
    ** JPM points to normalising inflation levels, a key driver
of growth in 2023, and says inflation remains stickier in Europe
than in the U.S.
    ** The U.S. is leading also in labour cost indices, it adds,
pointing to labour costs data that has moderated
    ** However, it says inflation is likely to reignite in the
U.S. if tariffs are imposed on imports and immigration declines
    ** Acquisitions remain a crucial growth factor, with
"leverage low and M&A appetite high", JPM adds
     ** It says Teleperformance's  TEPRF.PA  acquisition of
Majorel should help the call centre firm achieve its guidance,
upgrading it to "neutral" from "underweight"
    ** JPM's top recommendation is Intertek  ITRK.L  thanks to
its exposure to the U.S. and "healthy" margins
    ** Other top picks include Experian  EXPN.L , Bunzl  BNZL.L 
and SPIE  SPIE.PA , it says
    ** JPM puts Adecco  ADEN.S  on a negative catalyst watch due
to its limited U.S. exposure and balance sheet concerns

 (Reporting by Jakob Van Calster)
 ((jakob.vancalster@thomsonreuters.com))