Is that a market rebound in your pocket? Or are you just happy to see the Dow open?

Jamie Gordon
-
0
Is that a market rebound in your pocket? Or are you just happy to see the Dow open?
The Dow Jones booked another session of impressive performance on Monday, but Tuesday’s winners were the European indices, displaying something of an unsubstantiated market rebound.

Twittering Trump & Donald’s Dow Project

POTUS Donald Trump offered his two cents on the performance of US stocks today – opting to blame the sluggish start on Powell’s unaccommodating monetary policy. Rather than do the wise thing and recognise wider market tensions, the president decided instead to throw a hissy fit and misinform the public. I mean, why advocate for wiggle-room when you can whinge about not being gifted a short-term rally in the run-up to election season? Responding to the pressure to resort to negative interest rates, J. Powell commented, “I’m not following the market as I sit here answering your questions… My colleagues and I are completely focused on using our tools to support the American people, to support the achievement of our goals and that’s really all we’re focused on.”
“When you have negative rates, you wind up creating downward pressure on bank profitability, which limits credit expansion.”
He added, on the Bank of England’s upcoming Climate Change Impact report:
“As severe weather becomes more common, and that’s connected to climate change, you will see those things entering the forecast period, and certainly entering our supervisory practices as well as our economic forecasting,”

Market winners and losers

The big news from the US today came from social media behemoth Facebook (NASDAQ:FB) dropping 2.28% or 4.85 USD to 208.61 USD a share. The biggest large cap loser, though, was Goodyear (NASDAQ:GT), down 13.04% or 1.72 USD to 11.47 USD a go, after the company fell short of its earnings estimates. There was some rebound in oil, however, with Texas Crude up 1.50% to just over $20 per barrel. This came with talks today between Russian President Vladimir Putin and the leader of the country’s largest oil producer, Rosneft (MCX:ROSN), on the possibility of holding back 1.8 million barrels in oil production in an OPEC alliance to increase oil prices. While oil price rises aren’t usually conducive to liquidity, it may be a welcome counterweight to the $20 per barrel price slash over the last month, brought on by Coronavirus. The biggest winners today were without a doubt the European indices. After relying on the Dow Jones for injections of optimism over the last couple of weeks, the FTSE, DAX and CAC today found a new story to chase. Despite the plethora of worries – from the Coronavirus, Brexit, US-China trade wobbles and the Bank of England’s upcoming climate change report – Eurozone equities were happy to clutch onto any slim glint of optimism. Today, this was provided courtesy of the world’s larger central banks, many of whom pledged to tackle the threat to markets posed by Coronavirus (which – in regular terms – will likely involve further, myopic deepening of negative rates).

Overview from a fellow optimist

Speaking on the movements during today’s session, Spreadex Financial Analyst Connor Campbell stated,

“Europe maintained its arbitrary optimism throughout the session, joined in its gains by the Dow Jones.”

“Like pretty much every day since the coronavirus became a major market concern, Tuesday has seen just as much debatable ‘good’ news for investors to hold onto as unquestionable bad news for them to try and ignore. After all, the morning’s headlines were full of fears that the illness could come to infect 60% of the global population, with the total death toll crossing 1000.”

“Nevertheless, investors’ appetite to keep buying – alongside the hopes that the world’s central banks are prepared to step in to dull the impact of the outbreak – produced another strong rebound for the European indices.”

“The DAX rocketed to an all-time high of 13650 as it added 170 points, while the CAC crossed 6050 after rising 0.6%.”

“Even the FTSE managed to rise 0.9%, leaping past 7500 once more. And this despite gains for sterling, which added 0.3% against dollar and euro alike following a broadly encouraging morning for GDP data (the 0.3% rise in December more so than the stagnation in Q4 as a whole).”

“The Dow Jones wasn’t quite enthused as its European peers. However, that’s in part because the index’s own gains on Monday helped inspired the growth seen by the FTSE, DAX et al. Instead the Dow added 120 points, lifting it back towards 29400, and putting another run at its own record peak on the table this week. That is, unless the negative coronavirus headlines don’t reach critical mass once again.”

“It will also be curious to see whether or not the results of this evening’s New Hampshire primary have any effect on the Dow. The Iowa caucus gained little market attention, at least partially because it was so unclear who the actual winner was. There likely won’t be any such confusion come tomorrow morning.”

Final note

Compounding the somewhat woeful state of affairs, the advice from UBS took the tone of ‘drink water when thirsty’; telling investors that Coronavirus would continue to pose a threat to global equities, and we should therefore look to gold for safety.

AA expect to meet earnings across 2020

Ishen Patel
-
1
AA expect to meet earnings across 2020
AA PLC (LON:AA) have given shareholders an update with a positive tone, which has led to shares in green on Tuesday afternoon. The firm said that it expects to report growth in earnings across 2020, as cash flows should sustain to meet market expectations. The firm said that it had carried forward positive sentiment in the twelve months which ended January 31, which should give annual results a positive spin. AA also added that they remain on track with their strategic plan, as the firm looks to consolidate their status in the market. The firm said “In line with management expectations we have successfully stabilised the decline of the paid membership base, which returned to growth during the second half of the year. This led to a broadly flat paid membership base year-on-year. We expect the growth in the second half of FY20 to continue into FY21 in line with previous guidance.” For the year ended January 31, 2019, AA generated £341 million in trading Ebitda on revenue of £979 million. Pretax profit remained around £53 million. Simon Breakwell, Chief Executive Officer, commented: “We look forward to delivering full year results in line with market expectations, with growth in Trading EBITDA and strong free cash flow generation. In Roadside, we continue to deliver best-in-class customer service and have returned our paid membership base to growth. Our B2B business is performing well with strong renewal rates as well as new wins. Our focus in B2B remains building accretive long-term partnerships utilising our operational scale, service excellence, and innovative approach to customer solutions. Lastly, the Insurance business is delivering strong rates of profitable policy growth, and we expect this to continue next year.” AA are set to publish their full year results on 31st March 2020, and will carry an optimistic tone for shareholders. Shares in AA trade at 46p (+2.26%). 11/2/20 14:39BST.

Cranswick acquire Buckle family’s pig farming and rearing operations

Ishen Patel
-
1
Cranswick acquire Buckle family’s pig farming and rearing operations
Cranswick Plc (LON:CWK) have expanded their pig processing business with a new acquisition on Tuesday. The firm said that it has acquired a pig farming and rearing business in the UK, which forms part of its plans to grow and expand into other sectors. Shareholder should be pleased with the move by Cranswick as this should allow a more pragmatic approach to production and streamline costs. The firm said: “Following the acquisition of Packington Pork in December, which specialises in British free range and outdoor pigs, today’s transaction further increases Cranswick’s self-sufficiency in UK pigs processed to over 30%. The transaction reinforces Cranswick’s commitment to a sustainable and traceable farm to fork operation, in line with its Second Nature strategy.” Cranswick have acquired the Buckle family’s pig farming and rearing operations, as well as the family’s 50% share of the White Rose Farms Ltd pig production joint venture. This joint venture was set up by Cranswick and the Buckle family in 2018. These operations currently run in Lincolnshire and Yorkshire. Adam Couch, CEO of Cranswick, commented: “I am pleased to announce today’s transaction, which further reinforces our strategic commitment to supporting and growing the British pig farming industry. We have worked with the Buckle family for over 25 years and we are delighted to welcome Rick, as Managing Director of White Rose Farms, and the wider team to Cranswick.”

Cranswick give strong quarterly update

In July, the firm gave shareholders an impressive update which it described as ‘encouraging’. Revenues were up 1.5% for the three months to 30 June 2019, compared to the same period on-year. Far East exports were up 10% due to the African Swine Fever outbreak in China, and UK pig prices were up 10%. The Company acquired Mediterranean food company Katsouris Brothers for a £43.5 million interest. They also invested in a poultry primary processing facility at Eye in Suffolk. The new facility cost £75 million and will double the Company’s current processing capacity. Shares in Cranswick trade at 3,696p (+1.37%). 11/2/20 14:25BST.

Donald Trump’s new budget receives criticism from Congress and House Speaker

Ishen Patel
-
2
Donald Trump’s new budget receives criticism from Congress and House Speaker
Donald Trump has announced his new budget plan for the next fiscal year, as the American President looks to juggle current commitments and his new election campaign. The US President never fails to make news headlines, and has vowed to win the New Hampshire seat in the next 2020 election which will determine whether he will win another four years in office. The $4.8 trillion budget plan drew a negative reaction from many member of Congress, including some of his own Republican faithfuls. Certainly there is no doubt that Trump has not won all members in the House of Representatives or the Senate, however divides in his own party may bring about speculation over the likeliness of him winning his next election. Democrats were quick to step all over Trump’s new budget, as the Blue Party said that plans to cut social service had been betrayed. Notable inclusions in the budget spawned from domestic immigration policy, where Trump pledged to continue to build the great wall which would be build across the US Mexico Border. At the expense of this, social security and safety net programs were two of the bigger areas which received cuts, as the umbrella of welfare reform was slashed from Trump’s priority list. “Americans’ quality, affordable health care will never be safe with President Trump,” said House Speaker Nancy Pelosi. “Everyone knows the latest Trump budget is dead on arrival in Congress,” said Sheldon Whitehouse, a Democrat on the Senate Budget Committee. Trump also has plans to replace Medicare spending by lowering drug costs as well as increasing means tested benefit criteria to make individuals less eligible for services such as social security disability benefits. The areas which Trump seems to prioritize which are defense and military, budgets have remained flat from his pledge a couple years ago. The US President has forecasted that this new budget will lead to a $4.6 trillion deficit reduction over the next decade, and will forecast economic growth of 3% – rather optimistic considering the state of global affairs. As Trump looks to balance his campaigning commitments as well as secure his spot with current members of the House and Senate, the 2020 election seems open as ever.

N4 Pharma agree 14 month research deal with Nanomerics Ltd

Ishen Patel
-
1
N4 Pharma agree 14 month research deal with Nanomerics Ltd
N4 Pharma PLC (LON:N4P) have told the market that they have signed a research collaboration deal with Nanomerics Ltd. N4 said that the deal would be spanning 14 months and this tie up will allow the testing of two candidate formulations using its Nuvec delivery systems. The firm said that the partnership will be split into two phases, each lasting seven months. In the first phase, N4 said that the companies will develop and test the thirty day stability of four different Nuvec formulations, using both a plasmid DNA and a small interfering RNA. After this, the second phase will be underway where the testing of efficacy of the plasmid DNA will take place in an vivo antibody generation model. Nigel Theobald, Chief Executive Officer of the Company, commented: “This is an exciting opportunity for the Company to accelerate the development of its Nuvec® delivery system. Through our collaboration with Nanomerics we will be gaining access to scientists and laboratories with considerable expertise in the field of nanotechnology delivery system development and testing. Demonstrating 30-day stability will be a major milestone in highlighting the potential for Nuvec® to be used in a product and, by securing access to a novel siRNA, the Company will considerably broaden its data pack showing the versatility and utility of the Nuvec® system. Phase 1 of this work will run alongside the existing planned in vitro and in vivo testing of more disperse Nuvec® formulations, further details of which were announced in the Company’s interim results statement on 18 September 2019. Phase 2 will replace the previously planned efficacy work announced in the interim results. By working with Nanomerics, the Company will now be able to undertake two efficacy studies.” Ijeoma Uchegbu, Chief Technology Officer of Nanomerics, added: “We are delighted to be working with N4 Pharma and its Nuvec® delivery system. Having reviewed their existing data we can see the potential of the technology and, together with the Company, have devised a work programme to advance Nuvec® to the next level, with the aim of truly understanding its capabilities and unlocking its potential.” Shares in N4 Pharma trade at 3p (+9.00%). 11/2/20 13:58BST.

Cora Gold find high grade gold intercepts in Mali

Ishen Patel
-
0
Cora Gold find high grade gold intercepts in Mali
Cora Gold (LON:CORA) have found multiple high grade gold intercepts at its Sanankoro gold project in southern Mali. The gold miner said that drilling had targeted deeper oxide and sulphide extensions to the current inferred mineral resource of 5.0 million tonnes, which has a grade of 1.6 grams per tonne of gold, containing 265,000 ounces of gold. From the results, Cora said that drilling results had shown 2.61 grams of gold over 29 meters, including 3.89 grams over 12 meters at one of its operations. Bert Monro, CEO of Cora Gold, commented, “Cora has successfully intersected multiple higher-grade gold intercepts at Sanankoro in its latest drill programme. This set of results mainly tested continuity of mineralisation at depth, in part below the limit of the existing Resource pit shells. The current Resource has a range of pit depths from about 40-100m so there is significant scope to increase the open pit Resources with further successful drilling. “Our recently announced Scoping Study, which was calculated on our current Maiden pit-constrained Inferred Mineral Resource of 5Mt at 1.6 g/t Au for 265,000 ounces of gold, highlighted the attractive economic returns possible at Sanankoro including a high IRR of 84% and short capex payback of 18 months. We look forward to announcing further results from this drilling programme covering predominantly potential extensions to existing Resources.”

Cora Gold’s mineral resource estimation

Cora Gold saw their shares jump In December following a boost to their mineral resource estimation. The firm said it has received a maiden pit constrained mineral resource estimate from independent consultants SRK Consulting UK Ltd for its Sanankoro gold project in southern Mali. Whereas the gold recovery from oxides is shown to range from 92.9% to 95.7%, the sulphide resource estimate has assumed an 80% extraction rate for gold recovery. This has been determined on the basis of “very preliminary” metallurgical testing of two sulphide samples, Cora noted. Shares in Cora Gold trade at 6p (+2.13%). 11/2/20 13:42BST.

Namaka results hit by coronavirus leading to shares crashing 23%

Ishen Patel
-
0
Namaka results hit by coronavirus leading to shares crashing 23%
Nakama Group PLC (LON:NAK) have seen their shares crash on Tuesday as revenues took a bruising from the ongoing coronavirus epidemic. There is no doubt that the coronavirus now has become a global crisis, and millions of Chinese stocks, businesses and indexes have been wiped off following the spread. Global Governments are now taking a heavy approach to stop any risk of spread or contamination, however it seems that the disease has already hit the UK with a numerous number of cases being reported. Nakama, who hold operations in Hong Kong, London, Singapore and have other operations in Asia have seen their revenues bashed following the coronavirus outbreak. Nakama shares crashed 23.53% on Tuesday afternoon and trade at 0.65p. 11/2/20 12:58BST. The recruitment firm said that trading to the end of March has met expectations, however the final quarter presented challenges. Nakama said that revenue was bruised by the outbreak of coronavirus in both Hong Kong and Singapore, as local businesses look to delay new hiring until the virus assessment has been fully completed. “The impact of Coronavirus on revenues for both Hong Kong and Singapore have been immediately felt. As a result of the curbs on movement of people imposed by regional governments, firms are currently choosing to delay, in some cases indefinitely, the start dates of new hires until the full impact of the virus has been determined, directly impacting revenue recognition for the Group. Furthermore, recruitment activity generally has been immediately impacted by the effects of Coronavirus. Despite this immediate challenge, the Asia region, as a whole, remains highly attractive and it is expected that the future growth of the business will be focussed on developing the Group’s reach in region.” In the UK, Nakama said that the region remains “challenging” following the changes to IR35, which has reduced Nakama’s monthly revenue figures. The firm concluded by saying: “At the start of the calendar year the decision was made to relocate the Nakama UK office to Caterham, where the Highams business is based. Management are pleased with the positive response this has received from employees to date. Furthermore, as a result of the implementation of the new robust performance management programme, the Managing Director of the Singapore office exited the business and has been replaced internally. While headcount in the Group has decreased year on year, the Board believes that these reductions are necessary in order to bring the cost base in line with revenues to ensure the business continues to be profitable going forward. The Group’s cash position remains severely constrained and the Company faces a short-term cash challenge until the full impact of the recent cost reductions has come through. The Board are considering several alternative sources of funding to improve the Group’s cash position, but the Group still urgently requires an injection of capital.”

Primorus Investments hail Greatland Gold performance in strong end to 2019

Ishen Patel
-
1
Primorus Investments hail Greatland Gold performance in strong end to 2019
Primorus Investments PLC (LON:PRIM) have reported a strong final quarter in their Tuesday update as subsidiary investments have led to success. The firm hailed the recent performance of Greatland Gold (LON:GGP) as one of the drivers of success in the final quarter of 2019. Primorus told the market that they had invested £625,000 into Greatland Gold, and this initial investment has now trebled to be valued at £1.9 million following a string of success for the gold miner. The potential profit from its investment in Greatland stands at £1.3 million, and Primorus tips the investee’s share price to rise even further. Primorus also noted that Truspine Technologies had made progress. This firm is a medical devices company, and Primorus said that Truspine is “moving fast towards a London IPO”. Alastair Clayton, Executive Director commented: “Whilst the fourth Quarter of 2019 was again another period of solid growth across our diverse portfolio, it is fair to say that post-period (early 2020) has got off to an excellent start. We will return to these headline-grabbing matters later on but given the long-overdue but underwhelming increase in share price at the time or writing, it is worth remembering that Primorus is not a one trick pony. We find ourselves in early 2020 with a diverse and growing portfolio, primarily in unlisted technology and energy companies. Our 5 largest investments by deployed capital are Engage Technology Partners (£1.5m), WeShop (£875,000), Greatland Gold PLC (£625,000), TruSpine (£500,000) and Fresho (circa £260,000). On top of our direct equity investments we sometimes add to our balance sheet through a use of debt investing that generates interest and picking up equity options. A good example of this was the Zuuse Series B investment where the outlay was returned to treasury and interest in fully paid shares and a significant number of in-the-money options (compared to last raise) being sent to the balance sheet. We do also have shares in publicly listed companies in an effort to increase the liquidity and look through value of the portfolio. Sometimes these are very small investments made to effectively manage cash and add incrementally to the balance sheet through opportunistic means. We may also sometimes identify something special that we believe represents an opportunity in a listed company that has the potential to make an outsized contribution to our shareholders. Clearly our investment in Greatland Gold PLC is an example of this. So, the question really is what should our share price be if the core portfolio of unlisted investments is better recognised? I believe many of our investments have the potential to, or already have, eclipsed even the Greatland Gold investment in terms of performance and as demonstrated in 2019, many of our investments can be exited in the absence of a public quotation.”

Primorus driven by Greatland success

Greatland Gold have been successful over the last few weeks, and have seen a positive period of trading. In December, the firm said that it had identified mineralization at its mine in Tasmania, Australia. The firm said it completed a systematic grid-based drilling programme at Firetower, comprising 14 diamond holes with depths from 50 metres to 160 metres, for a total of approximately 1,530 metres. The programme was designed to test the main zone of gold mineralisation and results to date have confirmed broad widths of gold mineralisation, Greatland said. In addition, two further holes were drilled for around 670 meters to test the new targets identified by a 3D induced polarisation survey at Firetower East, approximately 500m east of Firetower. Shares in Primorus Investments PLC trade at 3p (-1.67%). 11/2/20 12:40BST.

China New Energy unaffected by coronavirus as confidence remains for 2020 trading

Ishen Patel
-
0
China New Energy unaffected by coronavirus as confidence remains for 2020 trading
China New Energy Ltd (LON:CNEL) have seen their shares lifted by over 5% following a strong second half performance. The firm said that it had traded consistently in the second half of 2019 and gave shareholders reassurance over current tensions in China. It is no doubt, that shareholders would have been worried about the firm’s performance as the coronavirus continued to spread across China and death tolls continue to rise. It seems that China New Energy have managed to overcome struggles in the second half of their financial year leading to shares in green today. Notably, the firm also gave an update today saying that it does not expect the coronavirus to hinder performance in the first few months of trading in 2020. Notably, the ethanol production system provider said its performance in the six months to December 31 is expected to be ahead of that for the six months to June 30. In the six months to June 30, China New Energy’s pretax profit rose to CNY27.1 million, from CNY8.1 million, on a revenue that surged to CNY163.9 million. On a great note for shareholders, the firm said that 2019 total revenue is expected to be at its highest figure since it was first listed in 2011. Chair Yu Weijun said: “I am proud of our team for both supporting our local community and providing business continuity during this challenging time. The macroeconomy for our industry remains unchanged and, as we enter 2020 with a strong order book, we remain confident that the business will have continued success in 2020 and beyond. This will be detailed in our annual report which we expect to release in the first quarter of 2020.” The firm has made an ensured effort to try and stop the outbreak of coronavirus in China, as the death toll continues to rise. The firm said: “As widely reported in the press, business activities in China are being disrupted by the Coronavirus outbreak and, whilst the Company does not currently believe this will cause a significant financial impact in 2020, the Board of CNE would like to provide shareholders with further information to understand the situation as it relates to CNE. The Company and its employees have been playing an active role in supporting the local community with the eradication of the novel coronavirus. On 30 January 2020, the Company donated and distributed 5 tons of medical grade alcohol (75% abv ethanol produced by CNE clients) to local hospitals to assist with disinfection. This was distributed to 17 local hospitals including: First Affiliated Hospital of Sun Yat-sen, the Second People’s Hospital of Guangdong Province and the Guangdong Maternal and Child Health Hospital. Whilst the Company’s clients mostly produce ethanol for renewable-fuel and potable markets, this illustrates the continuing demand for medical grade ethanol for sanitary applications.” Shares in China New Energy trade at 2p (+5.84%). 11/2/20 12:24BST.

Total SA expand into Spanish renewables market with two deals

Ishen Patel
-
0
Total SA expand into Spanish renewables market with two deals
Total (EPA:FP) have told the market that they have expanded into the Spanish renewables market on Tuesday. The French titan said that it had agreed two deals to add two gigawatts of solar power to its portfolio and operations, as it makes an ensured effort to diversify into the renewables sector. Total said that the deals have been struck with Spanish firm Powertis and Solarbay Renewable Energy. Figures and statistics are yet to revealed for the deals however Total said that they would be paying fees to the firms at agreed steps during the project commencement. Total have notably set a target for their generation capacity of 25 giggawatts by 2025, and this deal follows deals in India and Qatar. Under the terms of the deal, the respective partners will establish a joint venture to develop solar projects in Spain, and could be a point of revolution for the French titan. “Spain benefits from a solar resource that is unparalleled in Europe. Its photovoltaic market is one of the most dynamic in Europe, with an expected capacity increase from 6 GW to nearly 40 GW by 2030,” Julien Pouget, Total’s senior vice president for renewables, said in a statement. Notably, Total Solar will acquire 100% of solar projects being developed by Solarbay in the Andalusia, Aragon and Castile-La Mancha regions of Spain, representing total capacity of up to 1.2 GW. The projects and operations are set to commence at the end of 2020.

Total and Shell expand into renewables

A few weeks back, oil major Shell (LON:RDSA) also purchased a French renewables firm in an attempt to diversify into environmentally friendly policies and operations. The firm said that they had moved to purchase French wind farm specialist EOLFI as part of its plans to expand into the oil major’s electricity business. EOLFI have focused largely on solar and wind energy operations – including a specialism in offshore wind farms. Shell have big aims to diversify out of oil and gas into renewable energy, and this move is a bold statement to competitors. Shell want to become the world’s largest electricity company and expects to invest £1.6 billion to $3 billion a year — nearly 10% of its overall spending — on its power division by 2025. Many multinationals are now seeing the value of moving into the environmental friendly operating arena. The move from Total will come as a double benefit, first to expand operations and widen their network and secondly it represents a real chance for them to meet their environmental goals which will please shareholders.
1...1,1671,1681,169...1,760Page 1,168 of 1,760