FTSE 100 retreats from recent highs as commodity prices fall

Liam Roche
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FTSE 100 retreats from recent highs as commodity prices fall

Falling commodity stocks put an end to the FTSE 100’s 13-month peak. A 0.9% decline from Brent Crude, and a sharper 1.4% slide from copper, sent the index’s weighty oil and mining stocks lower, and left the FTSE itself down by over 20 points at lunchtime.

By contrast – and almost certainly contributing to the FTSE’s losses according to Connor Campbell, financial analyst at Spreadex – the pound rose 0.1% against the dollar and 0.3% against the euro. “This as sterling tries to reset after a rough set of sessions last week,” Campbell added.

The Eurozone fared better. The DAX essentially didn’t move after the bell, holding at the 15,220 mark it spent most of last week buzzing around, with the CAC dipping 0.1%.

“Looking ahead to this afternoon and, after last Friday’s big push, the Dow Jones is set retreat from its record highs,” said Campbell.

“The futures have the index down 110 points and back below 33,700. If things go the Dow’s way this week, especially in regard to Monday’s 3-year and 10-year Treasury auctions and Tuesday’s inflation readings, then it could cross 34,000. If not, and fears of rising bond yields and inflationary pressures reignite, then the Dow’s recent gains could quickly unravel.”

FTSE 100 Top Movers

Admiral Group (1.52%), Severn Trent (1%) and Bunzl (0.98%) made the most, albeit modest, gains on the FTSE 100 at lunchtime on Monday.

Rightmove (-3.10%), Ocado (-2.77%) and Kingfisher (-2.5%) are the day’s top fallers on Monday.

Shell

Royal Dutch Shell has confirmed its plan to install 5,000 electric vehicle chargers across the UK by 2025. The oil company is also looking to invest in slower-on-street public charging points in an effort to firm up its place as a market leader established through the acquisition of Ubitricity earlier this year.

It is a part of Shell’s plan to move towards a strategy of carbon neutrality. The Anglo-Dutch FTSE 100 company is aiming to operate 500,000 charging points across the world by 2025 and up to 2.5m by 2030.

Cyber security firm Darktrace unveils plans for London float

Liam Roche
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0
Cyber security firm Darktrace unveils plans for London float

Darktrace announcement comes days after disappointing Deliveroo debut

Darktrace, the cyber security company, is planning to float in London only weeks after Deliveroo ran into problems on its first day of trading.

Chief executive of Darktrace Poppy Gustafsson said on Monday that it would be “a historic day for the UK’s thriving technology sector” when the company, founded in 2013, listed on the London Stock Exchange.

Darkface’s products use artificial intelligence to detect and react to cyber threats. The company brought in revenue of nearly $200m in the past financial year but estimates that is targeting a market worth $40bn a year. The company made a profit on its earnings before interest, tax, depreciation and amortisation, with EBITDA of $9m in the past financial year.

“Developed by our talented software engineering teams in Cambridge, our artificial intelligence was the first on the market to be deployed at scale in the enterprise,” said Gustafsson. “Today [it] is responsible for protecting over 4,700 organisations worldwide from the most sophisticated cyber threats.”

Doubts have been creeping in over the future prospect of technology IPOs after shares in Deliveroo tanked by nearly a third on their trading debut in March. The company’s share price is down again by just under 1% at mid-morning on Monday.

According to a filing released by the company on Monday, Darktrace’s most sizeable market is in North American and its greatest source of growth, despite its decision to list in London.

Over a six month period ending in December, Darktrace’s revenue grew by 39% to $126.5m, compared to 45% growth in the last full year. Losses before tax rose by more than double to $47.9m during H1 of the current financial year, mainly down to a sharp rise in financing costs. Over the same period, operating losses fell to $4.9m to $21.5m in the same period.

Novacyt shares continue decline after DHSC dispute announcement

Liam Roche
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0
Novacyt shares continue decline after DHSC dispute announcement

Novacyt says revenues and profit levels for 2021 could be lower than market expectations without supply contract for cov-19 tests

Novacyt shares (LON:NCYT), having fallen by well over 30% on Friday, are down again by 5% on Monday morning to 400p following warnings on revenues due to a dispute with the UK Department of Health and Social Care (DHSC).

The AIM-listed company has recently said “it has strong grounds to assert its contractual rights” by taking legal action as the DHSC said it would not extend a supply contract for Covid-19 tests.

The firm has said that its revenues and profit levels for 2021 could be lower than market expectations without the contract. The situation is compounded by Novacyt’s lack of clarity regarding sales as a result of the “ever-changing nature of the COVID-19 pandemic and diagnostic testing demands”.

A statement released by the company said: “Whilst the directors are confident new contract wins will continue as Novacyt expands international sales and into private sector testing, they believe revenue and profit for 2021 may be lower than current market expectations due to the absence of the DHSC contract extension.”

Novacyt delivered revenue for the first quarter of 2021 of GBP72.6 million, with 50% of this attributable to sales to the DHSC.

The Novacyt Group is an international diagnostics business generating an increasing portfolio of in vitro and molecular diagnostic tests.

CyanConnode selected as Technology Partner for EESL Energy Solutions in Middle East and Africa

Liam Roche
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CyanConnode selected as Technology Partner for EESL Energy Solutions in Middle East and Africa

CyanConnode (LON:CYAN) has announced that it will partner EESL Energy Solutions LLC, Dubai, (EESL), as technology partner for projects in the Middle East and Africa for smart metering and smart lighting projects.

EESL India is a joint venture of four Indian public-sector undertakings; NTPC Limited, Power Finance Corporation Limited, Rural Electrification Corporation Limited and POWERGRID Corporation of India Limited.

EESL has also established a Joint Venture in Dubai, partnering with Hansa Energy Solutions to form EESL Energy Solutions LLC.

John Cronin, executive chairman of CyanConnode, commented on the newly established partnership:

“I am delighted to announce this partnership with EESL Energy Solutions, which I believe will deliver new opportunities for CyanConnode.”

“Offering a range of business models gives a flexible approach to our partnership with EESL and we look forward to collaborating with them to develop and deliver large-scale projects in the Middle East and African markets.”

Saurabh Kumar, EESL Executive Vice Chairperson, expressed similar views over the collaboration:

“EESL Energy Solutions is promoting energy efficiency projects in the Middle East and Africa and is pleased to be partnering with CyanConnode. We have selected CyanConnode as Technology Partner to leverage its market-leading RF Mesh Technology.”

“I look forward to a successful collaborative partnership.”

CyanConnode is a leader in Narrowband Radio Frequency (RF) Smart Mesh Networks, which are used for machine to machine (M2M) communication. As well as being self-forming and self-healing, CyanConnode’s RF Smart Mesh Networks are designed for rapid deployment.

In June 2018, CyanConnode launched its award-winning Omnimesh Advanced Metering Infrastructure (AMI) platform, which has already gained considerable commercial traction, especially in India which is a key market for the Company.

On early morning trading CyanConnode’s share price is up by nearly 10%.

Cake Box expecting record revenue despite pandemic

Liam Roche
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0
Cake Box expecting record revenue despite pandemic

Cake Box opened 17 stores in Q2 of the last financial year

Cake Box (LON:CBOX) is expecting to confirm a robust performance for the year ending 31 March 2021 in the face of lockdown restrictions over the past 12 months.

The cake seller said in an update released on Monday that it was currently holding franchisee deposits for 52 sites across the country.

Cake Box opened 17 stores in Q2 of the last financial year, including sites in Epsom, Gloucester, Newport, Ipswich and Hove. The group now has a total of 24 stores with 157 sites in total.

Cake Box is set to make a record revenue for the year, and is forecasting a rise of around 16% form the period before.

Co-founder and CEO Sukh Chamdal said: “Customer appetite for our products has continued to grow, with good traction across our expanded online and delivery services.”

“Our tested recipe of backing our franchisees has helped us deliver another year of growth, and it is thanks to the dedication of them and everyone in the Cake Box family that we have been able to emerge stronger from a year marked by the global pandemic.”

Cake Box will release its full-year results in June.

Senior Asda staff set to quit following Walmart shareholder payout

Liam Roche
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Senior Asda staff set to quit following Walmart shareholder payout

Asda chief executive Roger Burnley makes “personal” decision to leave

Senior staff are getting ready to quit Asda after they received payouts from a share scheme run by the supermarket’s US owner Walmart.

According to both industry sources and head-hunters, that say they have been approached by a number of Asda executives, inquiries have been above average for the sector.

Walmart recently completed the £6.8m sale of Asda to the Issa brothers and TDR Capital, the private equity firm.

A source in the industry told the Times that some of thee executives at Asda made the decision to leave because they would no longer be able to be part of the Walmart scheme. The Asda execs also referenced other issues including the failed tie-up with Sainsbury’s, the pandemic and the sale of the company.

The Times also reported that Asda has restructured its staff bonus to minimise the effect of the loss of the Walmart share scheme.

Staff can receive between 100% and 200% of their salary in cash bonuses, depending on their level of seniority.

Just this month Roger Burnley, chief executive of Asda, said that he had made the “personal” decision to leave amid rumours that the new owners had been looking for his replacement since Christmas. Burnley added that he could not see himself committing to the company for the next five years.

However, Burnley reaffirmed that his relationship with the supermarket’s owners was “magnanimous”, and he would bee continuing for thee next year to assist with succession planning.

Trevor Strain, Morrisons’ chief operating officer, Steve Murrells, the boss of Co-op, Jason Tarry, of Tesco, Stuart Machin, at M&S, Ronny Gottschlich, a former boss of Lidl, and Anthony Hemmerdinger, Asda’s chief operating officer, have been named by industry sources as potential candidates.

At the end of last year Asda was sold by Walmart to two billionaire Blackburn-based brothers in a £6.8bn deal. Mohsin and Zuber Issa are petrol station tycoons and backed by TDR Capital to buy the majority stake in the supermarket.

Shell plans thousands of ultra-rapid charging points across the UK

Liam Roche
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Shell plans thousands of ultra-rapid charging points across the UK

500 Shell-owned forecourts to have an average of one or two rapid chargers by 2025

Royal Dutch Shell (LON:RDSA) has confirmed its plan to install 5,000 electric vehicle chargers across the UK by 2025.

The oil company is also looking to invest in slower-on-street public charging points in an effort to firm up its place as a market leader established through the acquisition of Ubitricity earlier this year.

It is a part of Shell’s plan to move towards a strategy of carbon neutrality. The Anglo-Dutch FTSE 100 company is aiming to operate 500,000 charging points across the world by 2025 and up to 2.5m by 2030.

At present, Shell has just above 100 “rapid” 50KW and “ultra-rapid” 150KW chargers on its sites in the UK, while it is looking to double this figure by the end of 2021.

Sinead Lynch, who heads up Shell in the UK, commented further on the company’s ambitions to install charging devices:

“The ambition is to go to 5,000 by 2025. That’s not just going to be on the forecourts: we’re also wanting to step into that ‘destination charging’ space with the rapid and ultra-rapid . . . so you could see them in the car parks of supermarkets.”

Shell owns around 50% the Shell petrol stations in the UK, with the rest being franchises. Lynch added that she expects the 500 Shell-owned forecourts to have an average of one or two rapid chargers by 2025, while sites on A-roads in particular could have more.

“This is quite a lot of money we’re going to spend, so you have to spend it wisely where the commercial case is strongest,” she said.

Many sites would have “a hybrid model for decades”, but Shell would stop selling petrol entirely at some sites. Lynch added that Shell wants to create “the forecourt of the future”, which would include coffee shops and parcel pick-up services.

The company reinstated its plan to cut its carbon emissions footprint to net zero by 2050.

Shell, at the moment, has nearly 80,000 charging points across the world, including 2,700 on-street charging points in the UK, many of which were acquired through the acquisition of Ubitricity.

“The fuels market is slowly declining and the charging market is growing rapidly, so if we want to keep that market-leading position — and we do — we are going to have to grow that business quite considerably,” Lynch said.


Harwood ponders offer for superyacht services provider GYG

Andrew Hore
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Harwood ponders offer for superyacht services provider GYG

Harwood Capital is considering a bid for GYG (LON: GYG) that is lower than the original placing price fewer than three years ago. The possible offer for the superyacht painting and maintenance services provider is 92.5p a share in cash.
Harwood has been building up a stake in GYG and has reached 20.6%. Lonsdale Capital Partners sold a 16.8% stake on 18 January and Oryx International Growth Fund, which is related to Harwood, bought 16.65%. That was the first purchase by Harwood.
The share price had been around 70p at that time. The GYG share price rose to 87p prior to the possible bid announcem...

House prices a record high following extension of stamp duty holiday

Liam Roche
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0
House prices a record high following extension of stamp duty holiday

House prices rose by 1.1% in March

House prices increased at the fast rate in half a year in March following the chancellor’s decision to extend the stamp duty holiday, according to the Halifax house price index.

Property values rose by 1.1% last month, the largest increase in six months, and up from zero growth in February.

The average price of a home in the UK is now at £254,606, a record high.

The results of the survey provide an indication that the housing market in the UK is building momentum again following a mini slow-down in the lead up to the initial stamp duty holiday deadline in March.

Just over a month ago the chancellor Rishi Sunak pledged to “stand behind home buyers”, extending the stamp duty holiday to June. The budget also included assurance that the government will guarantee mortgages up to 95% of a home’s value.

Russell Galley, the managing director at Halifax, said: “The continuation of government support measures has been key in boosting confidence in the housing market. The extended stamp duty holiday has put another spring in the step of home movers, whilst for those saving hard to buy their first home, the new mortgage guarantee scheme provides an alternative route on to the property ladder.”

According to Royal Institute of Chartered Surveyors (RICS), the strongest momentum registered in the northwest, Yorkshire and the Humber, and Northern Ireland.

Jeremy Leaf, a former chairman at RICS , said: “The number of buyer enquiries, sales agreed and transactions were boosted by the stamp duty extension after lockdown and the conveyancing backlog prompted a market pause. Faster rollout of the vaccine too has helped to encourage more appraisals and instructions but not at a fast enough rate to head off further upward pressure on prices in the traditionally busier spring market.”

Biden retains robust stance on China by adding tech companies to black list

Liam Roche
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0
Biden retains robust stance on China by adding tech companies to black list

There was widespread expectation, and concern on the part of the Republican Party, that Joe Biden would be soft on China during his presidency. However, the US President has been more hawkish than many anticipated.

As tensions between the US and China continue to play out under the Biden administration, investors with exposure to Chinese stocks could have cause for concern. Since taking up his position in the Oval Office earlier in the year, the president described China as an assertive competitor to the open international system and has subsequently blacklisted stocks deemed to be a security risk.

On Thursday the Commerce Department added seven Chinese supercomputing organisations to a blacklist because of national security fears. Among the entities added to the list were: Tianjin Phytium Information Technology, Shanghai High-Performance Integrated Circuit Design Center, Sunway Microelectronics, the National Supercomputing Center Jinan, the National Supercomputing Center Shenzhen, the National Supercomputing Center Wuxi and the National Supercomputing Center Zhengzhou.

The seven entities were placed on the blacklist because they built supercomputers used by Chinese military actors, engaged in destabilising military modernisation efforts, and/or weapons of mass destruction programmes, according to the US government.

It is an accusation that has long been waged against China, which totally denies it is conducting these form of industrial espionage.

“Supercomputing capabilities are vital for the development of many – perhaps almost all – modern weapons and national security systems, such as nuclear weapons and hypersonic weapons,” U.S. Secretary of Commerce Gina Raimondo wrote in a statement.

“The Department of Commerce will use the full extent of its authorities to prevent China from leveraging U.S. technologies to support these destabilizing military modernization efforts,” she added.

Towards the end of his tenure, Donald Trump signed a law stating that foreign companies will not be listed on a US exchange if they do not cooperate with audits for three consecutive years from the US Public Accounting Oversight Board.

According to records on the boards website, there were 300 examples where inspections were denied. The vast majority were by Chinese companies, including Alibaba and Baidu, that are listed in America.

However, despite the growing tensions, and America’s forceful approach, 30 companies based in China were listed on the US stock exchange in 2020.

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