J.P. Morgan International FTM 18 May 26 Equity Strategy; Munich Re; Tele2; Trump-Xi summit: “Make it work and never mess it up”; Global Memory Market; Samsung Electronics; Mitsubishi UFJ Financial Group (8306) and More

Research evidence excerpt

J.P. Morgan International FTM 18 May 26 Equity Strategy; Munich Re; Tele2; Trump-Xi summit: “Make it work and never mess it up”; Global Memory Market; Samsung Electronics; Mitsubishi UFJ Financial Group (8306) and More

Global Equity Research

International First to Market 18 May 2026

Top Stories

Equity Strategy (Mislav Matejka, CFA)

Cyclicals, Value and Small caps lead ytd - a bridge too far for some?

Looking at the ytd performance beneath the surface, many we speak to find it somewhat counterintuitive that in Europe

Cyclicals, Value & Small caps are all in the lead ytd, and some are even increasing this lead despite the Iran conflict in the

backdrop. In the US, Cyclical sectors are also ahead ytd, but small caps and Value style have since the start of the conflict

surrendered the bulk of what was a big 8-10% outperformance up to that point. Cyclicals/Defensives lead in both regions

remains the case even when Tech/AI impact is fully stripped out from the comparison - top chart.

Munich Re (Kamran M Hossain) (MUV2 GR, OW, PT €590.00), Germany

Reducing estimates following Q1 - Plan B remains available

Following Munich Re’s 1Q 26 results, we reduce our 2026/27/28E EPS estimates by 3%/3%/5% and lower our PT to €590

(previously €655).

Q1 results showed a number of headwinds. Munich Re’s results showed a larger decline in P&C Re revenues than anticipated.

FX was a material headwind in Q1, but even taking this into account, revenues still came under material pressure (-13% YoY).

The other element that management highlighted was that the normalised combined ratio could potentially come in above the

~80% guidance for 2026 vs the 80.3% at 1Q26. The April renewals saw Munich Re seek to defend its margins. Prices were

down 3.1% with volumes down 18.5%.