Aquila Services Group (LON: AQSG) are Affordable Housing (AH) consultants and are unchanged at 26p after reporting its results for the six months to end September. Affordable Housing (AH) creates the possibility of living in a home for people who cannot afford to rent or buy. The provision of affordable housing is a key element of the Government’s housing plan to tackle homelessness and provide aspiring homeowners with a step onto the housing ladder.
The interims showed a 42% recovery in PBT to £247k with a 38% increase in Turnover to £4.8m the strong cash flow allowed a 20% increase in ...
The BT share price rose as high as 167.3p one Monday morning, before easing back as the session progressed.
BT showed signs of turning a corner earlier this month as they released half year results highlighting the impact of cost savings on profitability.
Adjusted earning per share rose 7% to 10.2p and adjusted profit after tax also rose 7% to £1,014m.
The jump in profitability came even though revenue rose just 1% to £10.3bn. It is these steady revenues that are the attraction to Reliance as BT is still dogged by pension liabilities.
Reliance have recently been outbid by a PE group for the Dutch T-Mobile unit and Reliance are reportedly eyeing BT’s Openreach roll out after BT ruling out a joint venture.
“It says something about the shifting dynamics of the global economy that an Indian firm like conglomerate Reliance Industries could be about to launch a bid for control of British telecoms giant BT,” said Russ Mould, investment director at AJ Bell.
“The reports come after a private equity bid for Telecom Italia which suggested the whole sector was in play.”
“Telecoms stocks have been as unloved as a cold caller on Christmas Day, and this is reflected in depressed valuations.”
“Reliance itself was outbid on a deal for control of a Dutch unit of T-Mobile as recently as September, and it may have rivals for its apparent interest in BT. French billionaire Patrik Drahi, the founder of Altice, has been steadily building up a position in BT and Deutsche Telekom already has a sizeable stake.
“It will be interesting in this context to see if this rumoured move by Reliance flushes out other parties and dials up a bidding war for BT.”
“You can understand why BT might attract interest. Despite its substantial pension liabilities and debts and iffy track record, it has a near monopoly position in the UK’s broadband network. And, for all its recent woes, BT has the capacity to generate substantial cash flows.”
European equities rebounded on Monday following panic-induced selling on Friday after the discovery of a new coronavirus variant Omnicron.
The FTSE 100 rose by 0.68% to 7,089 in early trade on Monday.
The German DAX was up 0.45% at 15,325 and the French CAC 0.9% higher.
“The anxiety attack on the financial markets shows signs of alleviating, as investors pause for breath and spot signs of optimism while scientists race to establish the severity of the new variant. The FTSE 100 opened up 1% in early trading, recovering some of Friday’s dramatic losses and the FTSE 250 was 1.5% higher,” said Susannah Streeter, senior investment and markets analyst Hargreaves Lansdown.
The rebound in markets can also be attributed to comments from South African doctors around how those infected with Omicron were reacting. Early reports suggest that Omicron isn’t more severe than Delta as first feared, although it will take time to properly assess patients on a large scale.
“There are reports from doctors in South Africa that Omicron infections don’t seem more severe and the World Health Organisation’s appeal for caution also appears to have calmed some nerves. It has observed that although there appears to be increasing rates of hospitalisation, that may be due to higher numbers being infected rather than due to its specific strain,” Streeter said.
BT led a broad rally in London-Listed shares on Monday with most industry sectors rising, particularly those with exposure to commodities and those heavily hit last Friday.
A price range of between 150p and 170p has been set for Recycling Technologies Group. The PrimaryBid offer is due to close on 2 December and the final pricing will be announced on 9 December with dealings likely to commence on AIM one week later.
Recycling Technologies Group wants to raise up to £40m, so the potential market capitalisation will be between £102m and £111m. The offer could be increased by up to 15% if there is sufficient demand. There could also be existing shares offered.
Recycling Technologies has developed a modular machine called the RT7000, which can process hard to recycle...
In his role as Lead Fund Manager at Octopus, Chris overseas a team dedicated to building UK equity portfolios designed to provide investors with an attractive yield.
It is immediately apparent that Octopus are doing things differently. The Multi Cap nature of their income fund, the Octopus UK Multi Cap Income Fund, alludes to a strategy producing one of the best performances among their UK Income peers.
The team at Octopus have built an income fund that encompasses a broad range of companies that other managers in the space overlook. These being shares with a market cap of £100m-£1bn, paying a dividend and providing significant opportunity for growth.
The portfolio utilises a core/satellite approach to investing that builds income and growth satellites around a selection of core holdings Octopus believes can grow earnings and dividends ahead of the market.
The strategy has helped Octopus return a 29.3% performance over the past year, alongside a very respectable 4.1% yield.
The FTSE 100 was a major casualty on Friday in the wake of the discovery of a new COVID-19 variant in Africa.
In what should have been a day focused on the sales figures of Black Friday, all eyes were on global markets and the severe selling which earned the name ‘Red Friday’.
“Forget Black Friday; today has been renamed Red Friday after the colour of share price screens as stocks slump globally on fears over a new Covid strain,” said Russ Mould, investment director at AJ Bell.
Shell and BP were down 4.8% and 5.9% respectively in early trade as oil prices dropped over 6%.
“The drop in the oil price the market’s way of saying it is worried about a reduction in economic activity, something which also explains the slump in metal prices,” Mould highlighted.
“Markets are clearly speculating that a rapid spread of a more brutal Covid strain could once again derail the global economy. Banking stocks were also weak as they are closely tied to economic activity.”
“The flipside of falling commodity prices is that a weaker oil price should provide some relief in terms of inflationary pressures. That may cause central banks to be more cautious towards raising rates in the near-term, however it does depend on whether the new Covid strain causes significant disruption or can be contained as best as possible in a rapid manner.”
Travel shares were heavily hit as the uncertainty about how disruptive the strain could be smashed airlines. London-listed IAG was down as much as 20% before recovering.
“Headlines calling it the ‘worst ever variant’ have caused investors to panic and dump shares in travel-related stocks for fear that we’re going to see tough travel restrictions once again,” said Mould
“Wizz Air and British Airways owner International Consolidated Airlines both fell by approximately 18% in early trading, followed by a 14% drop in EasyJet and a 9% decline in Jet2.
“This is the worst possible news for airline operators as they were just starting to see a pick-up in trading, helped by people becoming more comfortable about travelling on a plane and routes like US/UK reopening.
“These companies have been under significant financial stress and will want to avoid having to go back to shareholders yet again to ask for more money to help see them through bad times, should we get new widespread travel restrictions.”
A bout of extreme turbulence has rocked airlines with the emergence of a new mutant covid strain spooking investors. Shares in British Airways owner IAG were down by 16% in early trade, easyJet down 13% and Ryanair down 10%. FTSE 100 slides 3.3% as the storm engulfs markets.
“With Europe still battling with the surge of a fourth wave of the virus, there are now fears that the highly mutated Covid strain discovered in states in Southern Africa will prompt fresh shutdowns around the world in an attempt to stop its spread, leading to another drag on recovery,” said Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown.
The FTSE 100 was trading down 2.7% at 7,104 just after 10am in London.
IAG shares were heavily hit on Friday after African counties confirmed the discovery of a new variant of coronavirus that was called the ‘most significant’ yet.
The new variant is said to have over 50 mutations which are yet to be fully understood and presents a huge challenge to the global travel industry that was only just starting to get back on its feet with higher passenger number and the reopening of routes including the Transatlantic route.
The IAG share price was down as much as 20% in early trade on Friday, before recovering to be down 11%.
The selling was evident across the travel industry and those companies associated with travel, for example Rolls Royce traded at the lowest level since September.
“The decision by the UK government to impose stringent quarantine rules on six southern African countries within hours has severely rattled the travel and tourism industry. It’s set off a fresh bout of extreme turbulence for the travel sector,” said Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown.
“British Airways owner IAG nosedived 16% in early trade with investors deeply disturbed that demand for long haul transatlantic flights could be badly affected. Rolls Royce followed the descent, plunging by 11%, as the development could prove another major upset for its core business of making and servicing engines for long-haul aircraft. easyJet, Ryanair, TUI and Wizz Air also plummeted in early trading, registering much sharper falls than earlier drops of Quantas on Australia’s ASX which fell 5.5%, and Hong Kong listed Cathay Pacific which was 4.1% lower.”
IAG shares
Investors in IAG shares have been devastated by the drop today as the IAG share price now trades at the lowest levels of 2021, having given up most the gains made during the recovery from initial selling last February.
The Shell share price sank on Friday after the announcement of a new COVID-19 variant in Africa. Shell shares were heavily hit in a significant risk-off move that weighed on oil prices and oil shares.
With the prospect of a new variant comes the all too familiar scenario of lockdowns and reduction in demand that saw oil prices trade negatively last year. Indeed, the new variant has been called the ‘most significant yet’.
Negative oil prices are of course unlikely, but the risk to the downside in oil prices have been dramatically increased with the discovery of the new variant.
Front month Brent Crude Oil Futures for delivery in January were down 4.6% to $78.43 a barrel and approaching levels not seen since September. NYMEX Light Sweet Crude, also known as WTI Oil, was down over 5%.
Rising oil prices had been central to the recovery of the Shell share price through 2021 and a fresh bout of selling in energy commodities will be negative for Shell shares in the short term.
“Normally one shouldn’t get too hung up over a mere three months’ trading, but this was meant to be Shell’s big quarter, given the surge in oil and gas prices in the past few months. Sadly, it has missed earnings forecasts and left investors feeling frustrated,” said Russ Mould, investment director at AJ Bell after the release of Shell’s Q3 results in October.
Recent analyst forecasts of Shell earnings had valued the stock at 8.8x forward earnings, offering significant value compared to historical averages.
It must be noted that these forecasts were made before the discovery of the new variant and may be revised leading to changes in the forward earnings multiple.
Nonetheless, the selling in the Shell share price today has been exacerbated by low volumes due to Thanks Giving in the US and governments’ response to the new strain has been swift and decisive. Long term holders of Shell shares will watch with interest.
A new survey from the CBI has found that shoppers might face the biggest price rises in over 30 years amid widespread shortages.
“Christmas seems to have come early for retailers, with clothing and department stores in particular seeing a big upward swing in sales volumes in November,” said Ben Jones, CBI economist.
“Overall, retailers are becoming more optimistic, with both employment growth and investment intentions picking up strongly. Cost pressures remain a very real concern, however,” he added.
Businesses are also increasing prices as the cost of production is also rising.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, commented: “Looking ahead, higher CPI inflation, coupled with the withdrawal of government support at the end of the third quarter, will weigh on real disposable incomes.”
The French government has uninvited Priti Patel to a meeting with European interior ministers.
The move was made after Boris Johnson reportedly asked France to “take back” the people who have crossed the Channel.
The news is following the death of 27 people whose boat was capsized when crossing from France to the UK.
A French interior ministry source told POLITICO: “We find the open letter from the British prime minister unacceptable … Thus, Priti Patel is not invited anymore to the ministers’ meeting.”
The French interior ministry said in a statement: “We consider Boris Johnson’s public letter unacceptable and in opposition with discussions between counterparts.”
The meeting will go ahead without Priti Patel. France, Belgium, The Netherlands, Germany and the EU commission will continue without the UK.
