The Zacks Analyst Blog Highlights: Korea Electric Power, Royal Bank Of Canada And BAE Systems

For Immediate Release

Chicago, IL – June 28, 2016 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Korea Electric Power (KEP), Royal Bank of Canada ( RY) and BAE Systems (LON:BAES) ADR ( BAESY ) .

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Monday’s Analyst Blog:

Whose House Would You Rather Live In?

I think globally each week. Do you? Follow me on Twitter @johnblank100

As I wrote this week’s Global Week Ahead, I started laughing out here in California. But it really isn’t that funny. In fact, it is sad and scary.

88-year-old English zoologist Desmond Morris says humans laugh like this when we are fearful. A quote from him-- “I viewed my fellow man not as a fallen angel, but as a risen ape.”

The optimistic thing that can be noted about the post-Brexit situation in the U.K. is the government -- all of it, previous ones, future ones and the present one -- have 3 months to sort this out.

As an economist who thinks mightily of the U.K. and its long history, I hope they do. They can do this. They can emerge with a positive and forward-looking solution for their country.

Here is what the FT wrote—

“It is far from fanciful to imagine that the next two years or so will see the complete recasting of the nation’s politics, quite possibly with the creation of a new, centrist, pro-European party. So those who want Britain to stay close to its own continent could think the unthinkable and work to make it thinkable.”

Pessimists out there may well be right. This U.K. situation can go from extremely bad and head swiftly to even worse instability soon. Riots and violence against immigrants can escalate; Scotland can exit the EU; a series of U.K. governments may collapse in succession over the next couple years. All of that is entirely possible.

An Old United Kingdom has been dis-united by the New European Union. Look at news out of Europe — you can see: the EU is not dissolving. It is strengthening.

U.S. leadership is already adjusting. The Secretary of State is meeting first with NATO and the EU and catching up with the U.K. Foreign Secretary later today. The Head of the U.S. Fed is in Portugal at a meeting with the Head of China’s Central Bank and the Head of the ECB Mario Draghi.

Here is what is going on in the U.K. --

(1) There are now 3.7 million signatures on a U.K. ‘re-play‘ petition. This was a petition put up by a Leave supporter before last week’s EU referendum vote, and is now being used by the Remain camp.

“We the undersigned call upon HM Government to implement a rule that if the Remain or Leave vote is less than 60% based on a turnout less than 75% there should be another referendum.”

The U.K. Parliament will consider all petitions that get more than 100,000 signatures. The government responds to all petitions that get 10,000 signatures. It should be taken up on Tuesday of this week.

(2) On Monday, the U.K. pound resumed its historic slide in the wake of the UK’s decision to leave the EU, tumbling to a fresh 30-year low despite an attempt by U.K. Treasury chancellor George Osborne to calm the financial markets.

(3) On Sunday, for his weekly column in the U.K. Daily Telegraph newspaper, former London mayor and MP Boris Johnson, one of the heavyweights behind the pro-Brexit campaign, and possibly the country’s next prime minister had a few words for the U.K. public.

He cited “outstandingly strong” economic fundamentals in the UK.

FYI, The Daily Telegraph pays him huge sums of money to write. Johnson was paid £266,687 last fiscal year by the Telegraph to write his weekly column, according to his tax returns.

Here are a few more written comments from him--

(a) “The stock market is way above its level of last autumn.”

(b) “…the pound remains higher than it was in 2013 and 2014.”

(c) “We had one Scotland referendum in 2014, and I do not detect any real appetite to have another one soon.”

(d) With reports of serious violence against Polish U.K. immigrants and property over the weekend, Johnson answered that “EU citizens living in this country will have their rights fully protected, and the same goes for British citizens living in the EU.”

I am not making this up!

A U.S. friend of mine just spent 2 weeks biking and hiking in Wales. He said the news on Brexit was complete garbage. Absolutely complete garbage.

(4) Conservative Party Chancellor George Osborne hasn’t revealed his ambitions yet. PM David Cameron is done leading the U.K and the Conservatives effective October. That collapses his 6-year-old government.

The FT's George Parker and Alex Barker reported over the weekend that UK PM David Cameron first decided to call for the EU referendum at a pizza restaurant at Chicago O’Hare airport.

Now reporters at Slate have done some digging in an effort to figure out which pizzeria was the location for the fateful meeting. They have concluded that it was "likely" a Pizzeria UNO in O'Hare's Terminal 3.

Once again, I am not making this up!

(5) U.K. Labor Party deputy Tom Watson, who has his own mandate after being elected as deputy leader last summer, told the Labor Party leader Jeremy Corbyn he had lost the confidence of the Parliamentary Labor party.

The move follows a dozen resignations by members of the Labor Party shadow cabinet and a letter calling for Mr. Corbyn to go.

Expect this letter to be backed by more than ½ of Labor Party MPs. In short, the U.K. Labor Party has collapsed too.

Here is what is going on in Europe —

(1) U.S. Secretary of State John Kerry has landed in Brussels. He was seen in a photo with NATO Secretary General Jens Stoltenberg.

(2) German chancellor Angela Merkel has ruled out starting informal talks with London about the UK’s exit from the EU before Britain formally asks the bloc to begin official negotiations.

“Before Great Britain sends this [Article 50] notice, there are no informal discussions about exit procedures. The sequencing must be observed,” said Steffen Seibert, the Chancellor’s spokesman.

(3) Europe’s first security strategy in more than a decade is to push for closer EU defense cooperation, paving the way for multinational headquarters, military procurement and deployments to help cope with “times of existential crisis.”

A draft version of the EU’s “global strategy” seen by the Financial Times casts serious defense integration as “the norm” that will boost the bloc’s defense industry and better project Europe’s foreign policy clout in its neighborhood.

(4) Mariano Rajoy emerged as the clear winner of Spain’s general election on Sunday night, after his conservative Popular party won a better than expected 33% of the vote, putting the acting prime minister in a strong position to lead the next government.

Three non-U.S. large cap stocks emerged at the top of Zacks #1 Rank (Strong Buy) list —

(1) Korea Electric Power (KEP): This $31 billion market cap stock is South Korea’s provider of electricity. The stock also holds a long-term Zacks VGM score of A.

(2) Royal Bank of Canada (RY): This $88 billion market cap stock is one of the largest banks in Canada. However, the Zacks VGM score is F.

(3) BAE Systems ADR (BAESY): I know. This major U.K. aerospace and defense stock is crazy to point out right now. Someday, you might look brilliant. The long-term Zacks VGM score is A.

Despite what Boris Johnson is telling you, I bet you can buy U.K. large-cap stocks even cheaper in the weeks ahead!

LOL.

Boris Johnson and Donald Trump may need to sit down and try a Pizzeria Uno in LaGuardia or Heathrow. Maybe a panini joint if there isn’t one?

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