Video editing technology company Blackbird plc have announced a successful capital raise to fund expansion into new markets.

The focus will be on their ‘Powered by Blackbird’ intellectual property that provides lighting fast video editing and content publishing to organisations.

The funds will be deployed in the growth of their engineering team and expansion of their patent portfolio.

“With our core business in rude health we are incredibly excited to announce a placing to raise £8.0 million to enter new markets with our “Powered by Blackbird” intellectual property,” said Blackbird plc CEO, Ian McDonough.

“Recent contract wins for the Company include Univision, Eurovision Sport and a further expansion with TownNews to 80 regional US stations. “Powered by Blackbird” already has its first customer in our current sector focus of professional Media and Entertainment. The Company has also recently been awarded “Best Tech Company 2021” by the SportsPro OTT awards.

“While our reputation builds in the professional Media and Entertainment vertical, our technology has advanced through API development and the first “Powered by Blackbird” licence deal has shown our applicability to companies across multiple video markets. The creator economy, enterprise video and content distribution markets are of huge scale and have attractive growth rates offering a massive opportunity built around our existing intellectual property.”

Blackbird have recently posted record results for the six months to 30th June which saw revenues rise 21% to £867k.

The Lloyds share price has was subject to heighten volatility as the Autumn started but has since become stuck in a very tight trading range.

While this may not be an immediate cause for concern for some, it does raise the question why Lloyds shares haven’t joined in the rally to the extent other companies have since the announcement of the new COVID variant.

Omicron was announced 26th November and caused the most severe selling of equities in 2021.

All industry groups were hit in a broad sell off as the market panic sold into low volumes due to the Thanks Giving Holiday.

The Lloyds share price was particularly heavily hit that day giving up more than 7% of it’s value. However, unlike many shares in the FTSE 100, Lloyds is yet to recover the losses recorded since.

Indeed, Lloyds shares are down 4.88% from the close 25th November 2021 at the time of writing. This ranks Lloyds 89th out the 100 shares in the FTSE 100 since in terms of performance since the close 25th November. Darktrace is the worst performer, down 13%, whilst BHP is the top performer, gaining 7.9%.

Lloyds shares in 2022

The underperformance in Lloyds share can be attributed to a range of factors but the stand out driver will be the uncertainty cast over whether the Bank of England will now hold off from hiking rates in 2021.

Lloyds shares had previously surged following strong UK economic news that significantly increased the chances of a rate hike in the bank’s December meeting.

#Markets appear to be deciding that the #Omicron variant is not going to have too much impact on the recovery. The US Fed and Bank of England meet next week. Will they have a similar view? It's time to normalise #interestrates and "retire" transitional.

— Jamie Constable (@jamie_constabl) December 7, 2021

With possible economic disruption caused by the new Omicron variant, Lloyds may miss out on the opportunity to achieve increased Net Interest Margins with higher rates, if the Bank of England keeps rates on hold.

This will not only be a concern for investors around the December BoE meeting, but will persist into 2022 as uncertainty reigns.

With the UK government outlining new restrictions, the UK could well see a economic downturn in Q1 which would not only push back expectations of a rate hike, but even impact the quality of Lloyds’ assets such as mortgages and loans.

The UK government has now ended furlough and may be hesitant to reintroduce fresh measures alongside COVID restrictions. This would have a detrimental impact on the UK economy and UK-focused shares such as Lloyds.

If this scenario plays out, investor should expect the Lloyds share price to underperform the wider market in a similar way to the last two weeks.

Berkeley Group have yet again produced a very respectable set of results with pre tax profits rising 26% in the six months to 31st Oct 21, when compared to the same period a year ago.

Berkeley’s pretax profit rose to £290.7m, up from £230.8m last year. The jump in profits was helped by increased sales with revenue surging 36% to £1,220.7m.

Berkeley Group specialise in high-end developments in London and the South East and are often seen as a bellwether for the health of the Uk property market.

Berkley Group accounts for around 10% of new homes in London and the South East and is now seeing sales reservations at pre-pandemic levels.

“Berkeley are sounding confident in these results and are allocating additional capital to their land buying efforts accordingly. The group’s ability to redevelop complex sites in and around the capital, taking land that others fear to touch and transforming it into premium properties is their key attraction for investors,” said Steve Clayton, manager of the HL Select UK Growth Shares fund.

The HL Select UK Growth Shares Fund holds shares in Berkeley Group Holdings so Clayton and the fund’s investors would have been pleased to see Berkeley shares up over 5% at 9am in London.

“Berkeley lock significant future margin into their development plans and so far, the cost pressures seen across the industry have not impacted upon the group. No surprise to see the shares reacting positively,” said Clayton.

“Historic investment into land acquisition, at times when others have been wary or unable to commit, has left the group with a clear growth runway ahead. Capital continues to be strictly managed, with the group choosing to invest in land currently, given the future returns it expects are high. The ongoing dividend to shareholders provides a useful yield, but really Berkeley Group is a growth vehicle, built around the predictable delivery of future developments at attractive margins. Supply of housing in the capital and South East remains tight and bond markets are signalling that no nasty surprises on interest rates are expected any time soon. That backdrop should give Berkeley plenty of potential in the years ahead.”

The FTSE 100 surged higher on Tuesday as optimism grew around the economic impact of the new COVID variant and investors continued to cheer China’s decision to cut their RRR rates.

China yesterday announced they would be cutting their Reserve Requirement Ratio by 0.5% which promises an injection of liquidity into the Chinese economy.

Miners were big beneficiaries of the news. Anglo American, Glencore, BHP, Rio Tinto and Antofagasta were all over 3% stronger. Anglo American was the FTSE 100’s top riser adding 5.1% at the time of writing.

Although the mining sector was a stand out performer, the gains were broad with 90 of the 100 stocks in the FTSE 100 higher at 11am on Tuesday.

AstraZeneca was the FTSE 100’s biggest faller, down 1.7%.

“The more positive market sentiment seen at the start of the week extended into Tuesday, supported by waning fears about the Omicron variant and robust Chinese trade data,” says AJ Bell investment director Russ Mould.

“Suggestions the new Covid strain might only trigger mild symptoms are prompting relief among investors and helping travel stocks take off – however given the typical gap between infection and hospitalisation with coronavirus it remains early days in our understanding of just how virulent Omicron is.”

“China import data hinted at a domestic recovery and export data, while lower, was still notably better than expected. The net result being that the FTSE 100 index is now back at the levels it traded at before the Omicron-driven sell-off.”

Ashtead was a significant gainer after the plant hire group posted a 20% increase in rental revenue.

“Ashtead’s heavy duty industrial rental equipment fell out of favour during the peak of the pandemic, which is why new results look so spritely in comparison. However it’s been achieved, knocking the lid off full year expectations is good going,” said Sophie Lund-Yates, equity analyst at Hargreaves Lansdown.

Ashtead have enjoyed a 18% in revenue in their half year to 31st October as rental demand for their plant hire offering increased.

Rental Revenue increased 20% in the half year period and the group said they now expected earnings to be ahead of previous expectations.

“The Group’s strong performance continues with rental revenue up 20% for the half year over the prior year, but more importantly up 14% when compared with the first half of 2019/20, both at constant currency,” said Ashtead’s chief executive, Brendan Horgan.

Ashtead also added 58 locations across the United States by means of bolt-on acquisitions.

Analysts pointed to the return to normalisation as we move through the pandemic as a key driver to Ashtead’s performance.

“Ashtead’s heavy duty industrial rental equipment fell out of favour during the peak of the pandemic, which is why new results look so spritely in comparison. However it’s been achieved, knocking the lid off full year expectations is good going,” said Sophie Lund-Yates, equity analyst at Hargreaves Lansdown.

“As the world, and more specifically, industrial work, has started to resume, Ashtead stands to benefit. Plans to build out other revenue streams have merit, but for now, it’s still the traditional equipment rental business that’s bringing home the bacon.”

“The group’s enjoyed favourable market sentiment over the last few months, boosting the valuation in a big way. While the optimism can be understood, it shouldn’t be forgotten that Ashtead is an operationally leveraged business. As a cyclical company, its fortunes wax and wane with the wider economy too, so all-in, there could be some volatility if there are any unwelcome economic surprises.”

Notwithstanding any concerns about future economic uncertainties, investors would have been pleased to hear Ashtead increased their interim dividend by 28% to 12.5 cents.