NIO shares hit all-time high as investors await NIO Day

UK Investor Magazine
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NIO shares hit all-time high as investors await NIO Day

NIO shares (NYSE:NIO) broke to all time highs in Friday’s session as investor eagerly awaited the fourth annual ‘NIO Day’ and the unveiling of a new flagship car.

Listed in New York, NIO is China’s answer to Elon Musk’s Tesla with a range of smart and sustainable automotives that use electric batteries.

NIO Day is celebration of the Chinese company’s technology and is akin to Apple’s launch events with investors and media abuzz with the latest unveiling of new products.

2020’s NIO Day comes days after the company released bumper delivery figures that showed a 121% increase in December when compared to a year prior.

NIO delivered 7,007 vehicles in December and a total of 43,728 in 2020 – a 112% increase on 2019.

The growth in delivered vehicles has been reflected in NIO shares which posted strong gains through 2020. Having traded below $4 in January 2020, shares in ‘China’s Tesla’ touched $59 the day before NIO Day 2020.

“2020 has been a challenging year for the whole world. Against this backdrop, NIO has achieved consecutive record-highs along the way, and closed the year on a high note with a remarkable December deliveries of over 7,000 vehicles,” said William Bin Li, founder, chairman, and chief executive officer of NIO.

“These results are attributable to the growing recognition of our premium brand, the competitive and compelling products and services, the expanding sales network, and most importantly, the continuous support from our passionate and loyal user community. The innovative Battery as a Service (BaaS) model has shown popularity among our users since its launch. With the 100kWh battery pack offered as an option, the penetration of BaaS has reached over 40% among new orders in December, demonstrating its competitiveness and acceptance by our users. At the fourth NIO Day scheduled on January 9th, 2021, we will unveil our new sedan model and share the latest development of our autonomous driving and other core technologies. Aspired by the spirit of ‘Always Forward,’ the theme of the upcoming NIO Day, we will continue investing in the smart EV technologies, accelerating our new products development, broadening our sales and service network, and striving for the best holistic experiences for our growing user community in 2021 and beyond.”

NIO’s Chinese company name translates to ‘blue sky coming’ – worth noting with NIO shares trading at all time highs prior to NIO Day.

Bitcoin tops $40,000 in new record

Safiya Bashir
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Bitcoin tops $40,000 in new record

It was another record-breaking day for Bitcoin as the cryptocurrency surged above $40,000 (£29,500) for the first time.

Bitcoin has doubled in value over December as it hit the $20,000 mark halfway into the month. Its price has increased by more than 700% since March 2020.

Naeem Aslam, the chief market analyst at AvaTrade, commented on the cryptocurrency: “A major price level has been hit and bitcoin has proved that this is not the asset class you want to mess around with. It has proved itself to all disbelievers today.

“Institutional traders are the ones who have really got the rally going”

Bitcoin has many critics and some analysts predict the bubbles burst as it approaches $50,000.

Craig Erlam, senior market analyst at Oanda said: “We are very much in speculative bubble territory now and while I don’t think its done, it’s becoming increasingly likely that it’s going to get messy as there’s no logic behind what we’re seeing.”

“It’s pure speculation and FOMO [fear of missing out] and that never ends well. I previously said I wouldn’t be surprised to see $50,000 before the end of the month and I’m now thinking that was too conservative. The last $10,000 move only took four days. It’s getting silly now,” he added.

ESG ETFs boom in 2020 as AUM triples

UK Investor Magazine
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ESG ETFs boom in 2020 as AUM triples

ESG and Impact Investing were rapidly growing investment themes before the coronavirus pandemic and the latest data from TrackInsight highlights investors continued to allocate capital to ESG ETFs. This was despite volatility in the wider market that presented a plethora of opportunities across more established themes,

Analysis by ETF research platform TrackInsight found ESG ETFs enjoyed a 223% increase in assets under management in 2020 to $189bn.

The growth in ESG ETFs helped overall ETF assets under management grow to $7.6 trillion at the beginning of 2021

ESG ETFs

ESG investing is multifaceted pursuit as investors can embark on investment allocation that ranges from omitting firms such as alcohol, fossil fuel and defensive companies through to only investing in companies that have diverse boards that promote equality.

However, with the urgency around climate change front and centre, investor appetite for ESG ETFs has largely been directed at those with exposure to green energy. Indeed, these were some of the best performing ETFs of 2020.

Data from TrackInsight shows Invesco Solar ETF and Invesco WilderHill Clean Energy were by far the best performing ETFs of 2020 returning 221% and 200% respectively.

The Invesco Solar ETF tracks the MAC Global Solar Energy Index that includes companies such as Enphase Energy Inc, which traded at $31 in January 2020 and surged through 2020 to trade $213 in early January 2021.

Source:TrackInsight

“ETFs faced an acid test in 2020 and passed with flying colours. The tremendous growth we have witnessed demonstrates how ETFs have successfully convinced investors of the benefits of a liquid, tradable and transparent product – especially during volatile markets,” said Anaelle Ubaldino, Head of ETF Research and Investment Advisory at TrackInsight. 

“It’s also clear that 2020 was a long-awaited turning point for ESG ETFs with huge growth in this sector. As competition for potentially Trillions of dollars of new ESG assets heating up, we expect to see more issuers enter the ESG ETF market over 2021.”

Reach shares jump on online sales surge

Safiya Bashir
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Reach shares jump on online sales surge

Reach shares soared on Friday morning as the publisher saw digital revenue in Q4 grow by 25%.

The owner of Express, the Daily Star and other brands posted a strong digital performance and expects underlying operating profit for 2020 to between £130m to £135m. This is ahead of analyst consensus expectations which were £122m.

The chief executive, Jim Mullen, said: “It is a testament to our people that Reach has not only dealt with the unique challenges 2020 has presented, but we have accelerated our strategy and we are ahead of where we expected to be.

“The new COVID-19 restrictions bring macro-economic uncertainty, but the changes made in the business during 2020 to develop a new, more efficient operating model put us in a strong competitive position.”

In July, Reach said it planned to axe 550 jobs, which is over 10% of its workforce. Print sales fell 12% in the fourth quarter. and overall quarterly revenues were down 10% on a year ago.

December saw the group reach five million online customers registered for Reach ID. This is the customer insight platform that provides a combined view of the user’s activity across all of the group’s sites.

This month Reach will launch new sites that will cover Bedfordshire and Buckinghamshire. It is also expanding the MyLondon editorial team.

Last year, Reach suspended its interim dividend “due to Covid-19 uncertainty”.

Reach shares are trading 18.46% at 208.01 (1133GMT) and hit a 10-year high.

Barratt Developments shares rise on strong demand

Safiya Bashir
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Barratt Developments shares rise on strong demand

Barratt Developments was one of the top risers on this morning’s FTSE 100 surge in post-lockdown demand.

The group upped its forecast of the number of houses it expects to sell this year thanks to the strong demand as people rush to complete sales before the stamp duty holiday ends.

Following the first lockdown, sales surged by 24% and since then have cooled but continue to be up 9.2% year on year.

“Based on current market conditions and site construction activity, we now expect wholly owned completions to be between 15,250 and 15,750 homes,” said Barratt, which in October had forecast between 14,500 and 15,000 completions,” said Barratt Developments in a statement.

“We have delivered an excellent first-half performance,” the company said. “During the first half we saw an increased sales rate as strong underlying demand was supplemented by pent-up demand from the initial national lockdown, the introduction of the stamp duty holiday and the March 2021 end of help to buy for existing homeowners.”

Since Rishi Sunak introduced the stamp duty holiday over summer, the housing market has seen a boom.

“Given the ongoing mini-boom, prices might have been expected to rise again this month,” said Tim Bannister, Rightmove’s director of property data.

“But instead we have a slight dip, which could be a result of some new sellers pricing more realistically to have a better chance of agreeing a sale in time to benefit from the stamp duty savings on their onward purchase.”

Barratt Development shares rose over 4% at 717.20 (1015GMT).

Pets at Home raises profit guidance, shares rise

Safiya Bashir
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Pets at Home raises profit guidance, shares rise

Pets at Home shares surged on Friday morning after the group shared strong sales over the Christmas period and raised its full year profit guidance.

Despite voluntarily repaying the £28.9m in business rates relief, the retailer expects profits for the year to come in at £77m.

“While renewed Covid-related restrictions on a national level may constrain trade, we remain an “essential” retailer and the measures we continue to take across our stores, veterinary practices and online operations are ensuring we remain in a strong position to meet all of our customers’ pet care needs” said Pets at Home in an update.

As an essential retailer, Pets at Home has remained open over all of the lockdowns and has seen exceptional demand.

Peter Pritchard, the chief executive of the group, said last month: “In spite of the ongoing and wide-ranging impact of COVID-19, there is much to be optimistic about. The market in which we operate remains resilient, with recent changes to our work and leisure patterns supporting rising levels of pet ownership, a good proxy for future growth in both the underlying market and our business.

“We adapted our operations rapidly post the onset of the pandemic, and our focus on customer acquisition is underpinning market share gains across all channels and strong growth in our VIP and Puppy and Kitten clubs, thereby increasing the long-term opportunity of using data-driven, joined-up solutions across our range of products and services to drive customer share of wallet and lifetime value.”

Pets at Home shares rocketed over 7% in trading and are currently 449.07 (0958GMT).

M&S sales plunge over “challenging” Christmas

Safiya Bashir
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M&S sales plunge over “challenging” Christmas

Marks & Spencer (M&S) saw sales fall 8.2% in the three months to 26 December.

In what would normally be a stronger season, clothing sales dropped 25.1% to £787m. In November alone, the group saw clothing sales plunge 40%.

The M&S food court saw a better performance with sales up 2.2% to £1.7bn. International sales suffered and were down overall by 10.4%.

Steve Rowe, Chief Executive said: “Given the on-off restrictions and distortions in demand patterns our trading was robust over the Christmas period. More importantly beneath the Covid clouds we saw a very strong performance from the Food business including Ocado Retail and a further acceleration of Clothing & Home online.  I want to thank all my colleagues for a first-class execution of Christmas for our customers in near impossible conditions. 

“Near term trading remains very challenging but we are continuing to accelerate change under our Never the Same Again programme to ensure the business emerges from the pandemic in very different shape,” he added.

M&S has said that it has been impacted by Brexit and now faces potential tariffs from goods coming from the EU.

Ross Hindle, a retail sector analyst at Third Bridge, commented: “Marks & Spencer saw positive growth in food sales of 2.6%. However the growth is not enough to is offset their fashion-division declines with total sales for the Group down 8.4% for the quarter.”


“M&S’s potential acquisition of Jaeger hints at the potential for a more aggressive shift into the multi-brand space. M&S have numerous large stores which could be filled with non-M&S merchandise in order to drive their top-line. The risk here is whether such brands might cannibalise M&S branded products.”

“Despite the pressure faced by their clothing division, the M&S food division is expected to deliver solid results, propelled by both stock-piling and its Ocado partnership. Ocado has outperformed throughout the pandemic gaining 20 basis points in market share, however capacity issues continue to limit the Group’s growth potential.” 

Shares in M&S are currently trading -2.20% at 138.24 (0943GMT). In the year-to-date, shares have fallen from highs of 209.53.

Ryanair to cut flights amid lockdown

Safiya Bashir
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Ryanair to cut flights amid lockdown

Ryanair will be cutting flights from the end of January in response to the latest lockdown measures.

The budget airline said that “few, if any, flights being operated to/from Ireland or the UK from the end of Jan”.

Ryanair said in a statement: “The WHO have previously confirmed that governments should do everything possible to avoid brutal lockdowns, because lockdowns ‘do not get rid of the virus’.”

“Ireland’s Covid-19 travel restrictions are already the most stringent in Europe, and so these new flight restrictions are inexplicable and ineffective when Ireland continues to operate an open border between the Republic and the North of Ireland.”

“Ryanair does not expect these flight cuts and further traffic reductions will materially affect its net loss for the year to 31 March 2021 since many of these flights would have been loss making.”

“The fact that the Danish Government, with a similar five million population, has already vaccinated 10 times more citizens than Ireland shows that emergency action is needed to speed Covid vaccinations in Ireland.”

“All customers affected by these further flight cancellations and further travel restrictions will receive emails advising them of their entitlements of free moves and/or refunds later today.”

Ryanair has cut its full year traffic forecast from 35m to below 26-30m passengers.

Other airlines including Easyjet and British Airways are also reviewing flights over the lockdown period.

Shares in the group fell 2% on Thursday.

FTSE 100 commodities sector: metals are more attractive than oil

UK Investor Magazine
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FTSE 100 commodities sector: metals are more attractive than oil

As we start 2021 with a bumper performance in UK equities and a 300+ rise in the FTSE 100, Alan Green joins the first Podcast of the eyar to discuss the dynamics of the rally.

We have previously noted the relative value of UK shares compared to peers in the US, however the recent sharp rally may raise questions over the outlook from here, and whether stocks have got ahead of themselves.

Apart from Entain, who received a takeover approach, the FTSE 100’s top risers in 2021 thus far all reside in the commodities sector with Glencore (LON:GLEN), BP (LON:BP), Shell (LON:RDSB) and Rio Tinto (LON:RIO) all posting gains in excess of 13% YTD.

The prospect of a Biden administration and an economic reopening post-COVID has helped fuel a commodities rally but there is a noticeable divergence appearing in the share prices of oil companies when compared to miners. We explore the factors at play behind these companies and how this could develop in 2021.

We also discuss Blencowe Resources (LON:BRES), Versarien (LON:VRS) and Destiny Pharma (LON:DEST).

With rising metal prices a large part of the recent rally, we draw attention to Trident Royalties, who through their mining royalty business model, can provide exposure to developing mines without the high operating costs associated to junior miners.

Joules reveals strong online sales over Christmas

Safiya Bashir
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0
Joules reveals strong online sales over Christmas

Joules shares fell on Thursday morning after the group revealed a trading update for the seven-week period to 3 January 2021.

Total online sales, including sales through the Friends of Joules digital marketplace, increased 66% year on year, which was driven by traffic growth and improved conversion rates across digital platforms.

In-store sales fell by 58% during the Christmas period, reflecting the enforced closures of non-essential stores and reduced footfall when stores were able to remain open.

Following the national lockdown across the UK, the potential loss in revenues resulting from the closure of its stores is estimated to be in the range of £14m to £18m.

Nick Jones, CEO of Joules, commented: “We are pleased with the continued strong performance delivered across our digital channels during the Christmas trading period and are encouraged by the increasing customer awareness of, and demand for, the Joules brand. This has been supported by our Friends of Joules digital marketplace which added a great range of products and gifting options for customers throughout the Christmas trading period.

“Whilst the latest round of restrictions on store retail across the UK present a further challenge for the retail sector as we enter 2021, we remain very confident that Joules, as a highly relevant, digital-led brand with an engaged and growing customer base and healthy balance sheet, is well positioned to navigate these challenges. As a result, we remain as excited as ever by our long-term growth prospects,” added Jones.

Shares in Joules are trading -5.36% at 171.30 (1053GMT). Shares in the retailer have shed almost 26% of their value in 2020.

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