29/03/2016
Morning Round-Up: Shares up after Easter, Yahoo open for bids, Tata decision expected
European shares up after Easter
European shares climbed higher after the Bank Holiday break, whilst oil sunk back below $40.
The pan-European FTSEurofirst 300 index was up 0.8 percent just after 7am this morning, after after falling 1.5 percent on Thursday. Britain’s FTSE 100 Index opened 0.55 percent higher at 6,139.97 with bank, oil and mining firms leading the gains.
Investors will be looking to key announcements from the US this week, with Federal Reserve Chief Janet Yellen due to speak later today giving insights into the US central bank’s next rate rise. Non-farm payroll and employment data from the US is also due on Friday.
However, Brent crude oil as fallen by almost 1 percent this morning, pushing back below $40 per barrel.
Yahoo sets deadline for bids
Yahoo Inc has set an April 11th as the deadline to submit preliminary bids for its web business and Asian assets, according to the The Wall Street Journal’s report Monday.
Yahoo asked bidders details regarding financing, conditions or approvals that would have to be met on their end, the Journal said, citing a letter sent to possible bidders. (on.wsj.com/1VQGCDh)
This move comes after key shareholder Starboard Value called for the replacement of Yahoo’s entire board, in a letter sent to Yahoo late last week.
Tata steel plant decision expected this week
UK union leaders have held talks in Mumbai, as Indian steel giant Tata prepares to decide the fate of thousands of UK workers.
Officials from the Community union had “constructive” talks with senior company representatives ahead of the key board meeting on Tuesday
A spokesman for Community said: “The delegation from Community led by Roy Rickhuss, general secretary, along with Stephen Kinnock, MP for Aberavon, and Frits van Wieringen, chairman of the Tata Steel European Works Council, met in Mumbai with senior representatives of Tata Steel in advance of the board meeting.
“The meeting was open and constructive. The European delegates made the case for Tata to continue to support the UK business.”
The Port Talbot steelworks in south Wales suffered 1000 job cuts in January, and now has its entire future at stake.
Yahoo shareholder Starboard Value calls for total board replacement
The activist hedge fund Starboard Value, Yahoo’s largest shareholder, has called for the replacement of the company’s entire board.
In a letter to Yahoo, Starboard gave notice of their intention to seek the election of nine highly qualified director nominees at the 2016 Annual Meeting, citing Yahoo’s “dismal financial performance” as a reason for the overhaul. It continued:
“We have been extremely disappointed with Yahoo’s dismal financial performance, poor management execution, egregious compensation and hiring practices.”
In response, Yahoo agreed to “review Starboard’s proposed director nominees and respond in due course.”
The company, led by CEO Marissa Mayer, has gone through some troubled time of late, recently announcing their intention to cut 15% of its workforce as it pursued an “aggressive strategic plan” to return to profitability.
Shares in Yahoo (NASDAQ:YHOO) are down 0.37 percent on the news, at 34.67 (1530GMT).24/03/2016
Morning Round-Up: Retail sales strong, Next down 10%, oil slides
British retail sales better than expected
Consumer demand remained positive in February according to the Office for National Statistics, with official figures showing a smaller than expected drop in retail sales.
Volumes of retail sales dropped 0.4 percent last month after a bumper 2.3 percent rise in January, well above the 0.7 percent decline forecast by analysts. Compared to February 2015, sales are up 3.8 percent.
The ONS cited weak demand for new season clothing as a recent for the slowdown.
Next drop over 10 percent
Shares in British retailer Next (LON:NXT) are down over 10 percent this morning, after warning that 2016 could be its toughest year since 2008.
The company released figures showing pre-tax profits rose by 5 percent compared to 2015, but expected profits to fall this year by up to 4.5 percent.
Its shares fell below £60 for the first time since January 2014. Next is currently trading down 12.69 percent at 5810.00 (1124GMT).
Oil slides again
Oil fell back below $40 a barrel on Thursday, driven down by record-high US stockpiles and a strong dollar.
Crude stockpiles rose by 9.4 million barrels last week, according to the U.S. government’s Energy Information Administration.
The rise has contributed to a fall in oil prices, just after it rose on hopes that an output agreement would be reached by Middle Eastern countries.
24/03/2016
Crowd2Fund takes leading crowdfunding platform global
Crowd2Fund, one of the UK’s leading debt and equity crowdfunding platforms, has expanded into the global arena and opened up its platform to investors from 163 countries.
Demand for crowdfunding-style investment opportunities is growing in China from the large, high-net worth community based there, who are looking to the market-leading British crowdfunding market; extending its operations worldwide is testament to the scale Crowd2Fund has achieved and the growing source of investor demand on a global level.
Crowd2Fund is one of the few FCA regulated crowdfunding platforms – and will now be the only directly regulated site offering its debt and equity investment opportunities globally. All investments open to its global member base are secure, carefully vetted and compliant with UK financial regulation.
Grace Huang, Director of Crowd2Fund Asia Pacific commented:
“There is overwhelming demand from Chinese investors to take part in this new and exciting type of investment. Chinese investors like the relative safety of the UK market and in particular the more historic and innovative projects that Crowd2Fund attract.
“Opening their technology infrastructure in a legal and compliant way has been a huge challenge. We’re now seeing the first few investments to come out from the Chinese market which is a phenomenal step forward in the global investment space.”
Crowd2Fund’s CEO Chris Hancock recently established Crowd2Fund’s partnership with the China through the government’s UK Trade and Investment body, designed to assist British businesses expanding into international markets. He explains the complexities involved:
“Its more complex than just on-boarding investors from other markets – we need to
consider security and compliance as key hurdles to navigate effectively. Due to our scalable technology, Crowd2Fund has the capability to conduct business critical regulatory requirements such as anti money laundering and fraud protection procedures to mitigate risk for the investors on our platform. The global launch marks a very exciting step not only for the development of our platform, but also for those innovative British businesses looking to access vital growth capital and build a team of loyal, committed, international investors.”
In opening access for peer-to-business investment on a global scale, Crowd2Fund is leading the charge in taking a significant step to catering to the growth in demand from overseas investors. For more information, visit crowd2fund.com.
Miranda Wadham on 23/03/2016
William Hill down 13% on revised profits
Betting group William Hill (LON:WMH) are down 13 percent today after revising their operating profit downwards in a trading update.
The company cited an increasing number of time-outs and automatic self-exclusions over recent weeks as having a major impact on profits, particularly on the gaming side. The group now estimate that, should these trends persist around current levels, the consequent lower revenues will reduce online trading profits by £20-25 million in 2016.
William Hill now expect operating profit for 2016 to be in the range of £260-280 million.
James Henderson, CEO of William Hill, commented:
“Today’s statement reflects the combined effect of our assessment of the impact of recent regulatory changes and unfavourable sporting results including the worst results at Cheltenham in our recent history. We are also experiencing softer UK growth as a consequence of acquiring lower value customers. While the rest of the Group is performing in line with our expectations, we continue to focus on improving Online’s performance so that we can, once again, outperform the market.”
William Hill are currently trading down 13.54 percent at 320.60 (0923GMT).
23/03/2016
Morning Round-Up: Lloyd’s profits drop 30%, pound sees volatility, jobs gone at Credit Suisse
Lloyd’s of London sees pre-tax profit drop
The Lloyd’s of London insurance market reported results on Wednesday, seeing a 30 percent drop in pre-tax profit to £2.1 billion.
In a statement, Chairman John Nelson commented:
“In a market undeniably tougher than seen for many years, we have had to demonstrate our ability to adapt and take action. In these conditions, these results are creditable.”
Return on capital fell to 9.1 percent from 14.1 percent last year, with its combined ratio – a key measure of underwriting profitability – falling to 90 percent from 88.4 percent in 2014. Anything below 100 percent indicates a profit.
Pound falls against the dollar, volatility increases
The British Pound has sunk further against the US dollar this morning, down almost half a cent and extending losses that began yesterday.
Traders cite uncertainty over the EU referendum as the main reason for the drop, which falls three months today. After a slight recovery over the last few weeks, the Pound is now soaring back down to six-year lows seen in February.
The cost of insuring against a sharp fall in the pound also sky-rocketed this morning – another key sign of Brexit jitters.
Three-month sterling volatility has hit levels not seen since the last general election, showing that traders expect significant changes over the next quarter.
2,000 more job cuts at Credit Suisse
Swiss bank Credit Suisse has announced another 2,000 strong job cut in its global markets business, adding to the 4,000 cuts announced last month.
The bank are currently in the throes of a plan to reduce annual costs by 800m Swiss francs a year, but are struggling with their “high and inflexible cost base” and “volatile market conditions”. Recently appointed chief executive Tidjane Thiam said the performance of global markets in general was “disappointing”, adding that “in this context, we have taken immediate action to reduce outsized positions in activities not consistent with our new strategy and systematically reduced our exposures”23/03/2016
Media group Johnston Press up 17 percent on profits and i acquisiton
Leading local media group Johnston Press (LON:JPR) is trading up 17 percent this morning, after strong financial results and the announcement of their acquisition of the i newspaper.
The Group saw adjusted profit ruse 22.6 percent to £31.5 million, with net debt falling £14.8 million. In line with analysts’ expectations, adjusted EBITDA was at £57.3 million.
Ashley Highfield, chief executive, commented:
“We have reduced costs to maintain profitability, reset our portfolio and refocused on priority markets with attractive audiences that offer the best opportunity for growth.”
However, the second quarter was impacted by a sector-wide slowdown which continued through the second half and into 2016.
In a statement, Johnston Press also confirmed their acquisiton on the i newspaper, as approved at the general shareholder meeting on 21 March, with an 99.85 percent vote in favour. Highfield commented:
“The acquisition of the i newspaper is also incredibly exciting for us. It gives us scale, with a combined JP plus i daily print circulation of over 600,000 papers making us the UK’s 4th largest news publisher.”
The Group saw digital audience grew by 40.7 percent year on year, with total digital revenues up 12.4 percent to £30.6 million for the period.
22/03/2016
Morning Round Up: Petrobras hit by oil prices, Osborne faces tough deficit, travel shares lead FTSE down
Petrobras hit by oil, post biggest loss
Brazilian energy company Petrobras has become the latest firm to see profits hit by the oil crisis, posting its biggest ever quarterly loss on Tuesday.
Petrobras’ net loss widened to 36.9 billion reais in the three months to December, after writing down billions worth of assets. At a press conference, its chief executive commented that it was an “extremely difficult year for the oil industry”, as oversupply caused prices to drop over 40 percent.
Petrobras (NYSE:PBR) shares fell by nearly 6 percent in after hours trading after the release of the results, but are currently up 1.35 percent at 5.64 (1130GMT). Petrobras are also currently in the midst of a major corruption scandal involving several high-profile government figures. George Osborne unlikely to hit deficit target Chancellor George Osborne is close to missing his target for cutting the budget deficit in the current financial year, according to official data released on Tuesday. Just days after releasing his 2016 Budget, figures suggest Osborne is unlikely to hit deficit goals for this year. His aim to bring the deficit down to £72.2 billion for 2015/16 will be difficult, as the budget already stands at 70.7 billion with one month to go until the end of the tax year. According to the Office for National Statistics, in order to meet his goal borrowing in March would need to fall to its lowest level since 2004. Travel shares cause FTSE to sink Travel and leisure stocks led the FTSE downwards this morning, after several major explosions in Brussels. The FTSE 350 Travel and Leisure sector was 1.6 percent down, with the FTSE 100 overall down 0.54 percent (1135GMT). Airlines IAG and easyJet were down 4 percent and 3.5 percent respectively, with Thomas Cook falling 5.4 percent and cruise operator Carnival down 3 percent. Explosions at both Brussels International airport and a metro station in the city centre took place at rush hour this morning. Updates are still being given.22/03/2016
UK manufacturing output sinks, but demand remains high
Manufacturing output fell to its lowest level since 2009, according new the latest survey from the Confederation of British Industry (CBI).
Of the 471 manufacturers surveyed, just 18 per cent said output had gone up over the last three months, with 33 per cent reporting a fall. This means manufacturing output volumes fell to -15 in the three months to March, from 0 in February.
However, manufacturers remain optimistic, with the expected volume of output balance rising to 23 per cent, well up on February’s 11 per cent.
Rain Newton-Smith, director of economics at CBI, said:
“Whilst total order and export books remained steady, a drop in output reflected some volatility in the food and drink sector. Reassuringly, manufacturers expect a swift turnaround in activity.”
21/03/2016
Apple to unveil new products at event later today
Apple are set to launch several new products today at a media event in Silicon Valley.
Speculation has increased that the company will be launching a new iPhone model, rumoured to be an update of the 5S but with similar features to the iPhone 6. The launch will tap into the lower-end market, helping the company’s sales in the slow season between the major product launches in September. Apple are also widely expected to release a new iPad model, along with accessories for the Apple Watch.
The media gathering will also give the company the chance to respond to press over its stance on the FBI case, something which Apple have refused to offer further comment on recently. Apple, supported by various other tech companies, are refusing to comply with the FBI’s request for them to hack into the phone of San Bernardino attacker Syed Farook.
21/03/2016