EU AUTOMOTIVE: Honda Motor: 2Q25 Results
(HNDA; A3/A-neg/Aneg)
Another weak quarter. Spreads could see some pressure with chip shortages the latest issue it faces; a one notch downgrade is already well priced in, however.
- Revenue in line with BBG consensus falling 2% YoY. 1H auto unit sales fell 6%, mainly China, but also Japan driven.
- EBIT missed by 12%, with margin 110bp lower YoY at 3.7% and again impacted by write-downs.
- EV write-downs had a 210bp impact on 1H EBIT margin, with tariffs a further 150bp. Tariffs eased sequentially this quarter and were offset by pricing and cost measures, but FX was a further drag. That left Automobiles at negative margin, with Motorcycle and Financial Services positive (in both quarters).
- 1H Industrial FCF Y760bn, up from Y372bn on lower investments.
- Net cash Y3.1tn, down from Y3.5tn YoY.
- FY guidance downgraded:
- Auto unit sales forecast reduced 7%. That is a split between chip shortage impact in NA and Asia incl. China demand weakness.
- Revenue guidance decreased by 2%.
- Expected EBIT margin reduced 60bp to 2.7% due to chip shortages and sales, partly offset by FX.
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Historical bullets
SILVER TECHS: Bull Wave Extends
- RES 4: $49.804 - All-time high Apr 2011 and major resistance
- RES 3: $49.444 - 3.236 proj of the Sep 4 - 16 - 17 price swing
- RES 2: $49.000 - Round number resistance
- RES 1: $48.939 - Intraday high
- PRICE: $48.674 @ 08:19 BST Oct 8
- SUP 1: $45.056 - 20-day EMA
- SUP 2: $42.106 - 50-day EMA
- SUP 3: $40.404 - Low Sep 4
- SUP 4: $38.087 - Low Aug 27
Trend signals in Silver remain bullish. The metal has traded to a fresh cycle this week, as the bull cycle extends. Note that moving average studies are in a bull-mode position too, reinforcing current conditions. Sights are on the $49.00 handle next. Clearance of this level would pave the way for a climb towards $49.444, a 3.236 projection of the Sep 4 - 16 - 17 price swing. Initial firm support to watch lies at $45.056, the 20-day EMA.
USDCAD TECHS: Bullish Wave
- RES 4: 1.4111 High Apr 10
- RES 3: 1.4083 3.0% Upper Bollinger Band
- RES 2: 1.4019 38.2% retracement of the Feb 3 - Jun 16 bear leg
- RES 1: 1.3982 200-dma
- PRICE: 1.3964 @ 08:15 BST Oct 8
- SUP 1: 1.3889/3839 20- and 50-day EMA values
- SUP 2: 1.3727 Low Aug 29 and a bear trigger
- SUP 3: 1.3689 Low Jul 28
- SUP 4: 1.3637 Low Jul 25
USDCAD continues to trade just ahead of its recent highs. A bull cycle remains intact. The breach of 1.3959, the Sep 26 high, reinforces current conditions. The move higher maintains the bullish price sequence of higher highs and higher lows. Note too that moving average studies are in a bull-mode position, highlighting a dominant uptrend. Sights are on 1.4019, a Fibonacci retracement point. On the downside, first key support lies at 1.3834, the 50-day EMA.
EUROSTOXX50 TECHS: (Z5) Trend Needle Points North
- RES 4: 5777.41 1.382 proj of the Aug 1 - 22 - Sep 2 price swing
- RES 3: 5727.18 1.236 proj of the Aug 1 - 22 - Sep 2 price swing
- RES 2: 5700.00 Round number resistance
- RES 1: 5689.00 High Oct 2
- PRICE: 5619.00 @ 07:55 BST Oct 8
- SUP 1: 5615.00 Intraday low
- SUP 2: 5527.10 20-day EMA
- SUP 3: 5455.98 50-day EMA
- SUP 4: 5366.00 Low Sep 17
Eurostoxx 50 futures remain in a bull-mode condition and short-term weakness is considered corrective. The recent breach of key resistance at 5525.00, the Aug 22 high, confirms a resumption of the uptrend. Sights are on the 5700.00 handle next, with potential for a test of 5727.18 further out, a Fibonacci projection. MA studies are in a bull-mode position too, highlighting a dominant uptrend. Initial firm support is 5527.10, the 20-day EMA.
