UK housing market sees shortage that could last to 2022

Liam Roche
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UK housing market sees shortage that could last to 2022

Demand remains well above levels seen last year

The UK housing market is experiencing a severe shortage of properties for sale as buyers rushed to the market before the end of the stamp duty holiday.

Zoopla, the property site, has said that Britain is facing up to its “greatest stock shortage since 2015” as the number of properties on the market plummeted in June when compared with the average level in 2020.

With demand remaining steady, well above levels seen last year, supply shortages could last until 2022, according to Zoopla, as house price growth looks set to carry on.

“The headline rate of house price growth is running at 6% year-on-year and this is expected to moderate to between 4% and 5% by the end of the year,” Zoopla said in its monthly house price index.

The average price growth for houses is at 7.6%, while for flats this figure falls to 1.2%.

The stamp duty holiday, which provided £15,000 of relief up to £500,000 on the purchase of a property, is now being tapered down. Until the end of September, buyers can get relief on the first £250,000.

Gráinne Gilmore, head of research at Zoopla, said: “The post-pandemic reassessment of where to live has further to run, especially as workers receive confirmation about flexible working. This means higher levels of demand will still be evident and potential vendors with family houses to sell could be in pole position.”

“However, the lack of supply, especially for family houses, means the market will start to naturally slow during the rest of this year and into next year as buyers hold on for more stock to become available before making a move.”

Car production tumbles to lowest point since Suez crisis in 1956

Liam Roche
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Car production tumbles to lowest point since Suez crisis in 1956

Society of Motor Manufacturers and Traders calls on government to support industry

Car factories across the UK are manufacturing their lowest number of vehicles since the Suez crisis back in 1956.

A mere 53,000 vehicles were made in July, a drop of 37% compared to the same month in 2020, when the UK was emerging from the first pandemic-induced lockdown.

Factors causing the slowdown include the ‘pingdemic‘, a worldwide shortage of microchips and traditional summer holiday shutdowns at car plants.

Overall production levels are up for 2021 by 18.3% year-on-year, while compared to 2019, before the pandemic, the numbers are down by 28.7%.

As a result of poor performance, and the impact of Covid, the Society of Motor Manufacturers and Traders (SMMT) has downgraded its production forecast for 2021, cutting it by 55,000 to 950,000.

The SMMT suggested that the UK Government should intervene to offer assistance to the industry.

“These figures lay bare the extremely tough conditions UK car manufacturers continue to face,” Mike Hawes, chief executive of the SMMT, said. “While the impact of the pingdemic will lessen as self-isolation rules change, the worldwide shortage of semiconductors shows little sign of abating.”

There is a worldwide shortage of computer chips for cars as production moved during the pandemic to meet demand for consumer electronic goods. The average new car needs 1,500 microchips.

Some companies, including Toyota are closing down production at their factories for a temporary period of time.

SMMT numbers suggest that the UK’s car industry accounts for 13% of exports.

“Government can help by continuing the Covid measures in place and boosting our competitiveness, with a reduction in energy levies and business rates for a sector strategically important in delivering net zero,” Hawes said.

FTSE 100 steps back as the ‘Super Bowl of high finance’ approaches

Liam Roche
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FTSE 100 steps back as the ‘Super Bowl of high finance’ approaches

“It’s the one they’ve all been waiting for. The Super Bowl of high finance – the Jackson Hole symposium – kicks off tomorrow and there’s no question who the star man is,” says AJ Bell financial analyst Danni Hewson.

The spotlight will be on the chair of the US Federal Reserve Jerome Powell and whether he says anything on the tapering of financial support for the economy.

“The incentive for keeping things low key is that the Delta variant has made the global economic recovery more fragile and it may be the digital-only event turns into something of a non-event.”

The FTSE 100 was showing some signs of nerves ahead of the event as it dipped in early trading on Thursday, down 0.56% at the time of writing to 7,110.

FTSE 100 Top Movers

At the top end of the FTSE 100 on Thursday is CRH (1.96%), Ocado (1.32%) and Royal Mail (0.96%).

Trailing the pack, the bottom three during the morning session on Thursday is Melrose Industries (-2.81%), Mondi (-2.33%) and Antofagasta (-1.99%).

Barclays to invest more than £294m to expand India operations

Liam Roche
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Barclays to invest more than £294m to expand India operations

Total invested by Barclays in Indian operations now over £800m

Barclays (LON:BARC) confirmed on Thursday that it will invest more than £294m in its Indian operations in an effort to expand.

This will bring the total invested by Barclays’ Indian operations to over £800m.

The FTSE 100 bank said the funds would allow it to grow its corporate and investment banking, in addition to its private clients businesses in the country.

“As economic activity gathers momentum, there is increased demand for capital from clients,” said Jaideep Khanna, head of Barclays, Asia Pacific and Country CEO, India.

During H1 of 2021 Barclay’s pos-tax profit came to £4.2bn with around 5% of group income coming from operations outside of Europe and America.

“We have ambitious growth aspirations, and the investment will help accelerate that as we look to leverage the attractive opportunities that the present situation offers” Khanna added.

The Barclays share price is down by 0.42% during the morning session on Thursday.

Oil price rally comes to a halt on Covid concerns and supply issues

Liam Roche
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Oil price rally comes to a halt on Covid concerns and supply issues

Doubts remain over the strength of global recovery

Oil prices are down on Thursday for the first session this week as concerns over demand.

The price of Brent crude oil is down by 0.78% $71.37 per barrel just after 9am, having jumped up by 1.7% on Wednesday.

Oil prices rose buy 10% last week through to Wednesday as the US Energy Information Administration (EIA) confirmed that its crude stock fell for the third week in a row, while demand for fuel rose to the highest level since March 2020.

However, overall, the demand outlook is not so strong.

“For now, U.S. consumers appear to be shrugging off the spread of the Delta variant … However, it seems likely that we are near the peak in U.S. demand, which will act as a lid on oil prices,” Capital Economics said in a note.

Concerns over new outbreaks of the coronavirus, especially the Delta variant, are leading to doubts over the strength of the global economic recovery.

“Although prices had reversed strongly … questions remain on how the ever-surging number of cases globally will impact fuel demand,” said Avtar Sandu, senior manager commodities at Phillip Futures in Singapore.

“In the short-term, the oil market may be volatile with frequent pull-backs,” he said.

Oil prices were up on Tuesday as investors’ hopes of a recovery in demand for fuel were boosted following the US’s drug regulator approving the Pfizer Covid-19 vaccine.

Officials are hoping the approval will encourage unvaccinated Americans to take the jab, as well as encouraging state and local governments to bring vaccine mandates into action.

“With many corporations and government agencies likely to enforce vaccine mandates, return to office travel should dramatically pick up in the fall,” Edward Moya, senior analyst at OANDA, told Reuters.

British Land makes changes to portfolio

Liam Roche
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British Land makes changes to portfolio

British Land has either sold, or has offers for, around £160m worth of assets this quarter

British Land (LON:BLND) confirmed its acquisition of Peterhouse Technology Park in Cambridge for £75m, with a net initial yield of 4.15%.

In addition, the FTSE 100 company has completed on the purchase of the Priestley Centre in Guildford for £12m, and the Finsbury Square Car Park for £20m.

British Land has either sold, or has offers for, around £160m worth of assets this quarter at prices that are 6% above book value.

For example, the FTSE 100 company sold Virgin Active in Chiswick for £54.3m in line with book value, however, part of the agreement was to sell Woodfields Retail Park in Bury for £37.5m, 18% above book value.

“We are delighted with the momentum we are delivering across our business as the economy reopens. Leasing activity at our London campuses has been strong, with a significant amount of space going under offer to a broad range of occupiers in the last two months,” said Simon Carter, the chief executive officer of British Land.

“At the same time, we are continuing to deliver against our strategic priorities. We have sold off-strategy mature assets and will actively redeploy capital into opportunities that allow us to maximise our competitive advantage in asset management and development,” he added.

The British Land share price is up by 0.18% during the morning session on Thursday.

New standard list shell: Citius Resources seeks base and precious metals

Andrew Hore
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New standard list shell: Citius Resources seeks base and precious metals

Citius Resources is the latest shell to float on the standard list. It is seeking to acquire a business or project involved in base or precious metals. There could be potential deals with large mining companies that want to divest assets. Commodity prices have been recovering and management believes that this could mark a recovery in the sector. That would make it a good time to invest in an attractive project.
If a deal is not announced within 18 months shareholders will be given the chance to decided whether to continue to seek an acquisition or wind up the company and get back what little c...

Tesla is top performing ‘green’ stock with UK investors as greenwashing remains a concern

Liam Roche
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Tesla is top performing ‘green’ stock with UK investors as greenwashing remains a concern

Data from Saxo Group’s equity themes has broken down the top performing ‘green’ stocks with UK investors in what has been a dramatic year for the sector.

The measure of green stocks, according to head of equity strategy at Saxo, Peter Garnry, “is whether a stock has a positive net impact on the environment”.

“For a stock to be green it needs to have a positive impact on this path. In our green transformation basket, we also have companies, which are working with what you could call environmental services, like companies that help clean water, recycle certain materials etc. which we think are benefiting the planet and then of course the companies producing low-carbon intense energy production, like wind, solar etc. speak for themselves,” Garnry added.

Tesla, perhaps unsurprisingly, has been the most popular with Saxo’s UK traders this year, followed closely by its rivals Nio and XPeng.

Two British companies featured in Saxo’s top ten, ITM Power, the manufacturer of integrated hydrogen energy solutions, and Ceres Power Holdings, the clean energy technology company.

UK Top Traded in Saxo’s Green Transformation Basket

1Tesla Inc.
2Nio Inc.
3XPeng Inc. – ADR
4Plug Power
5ITM Power Plc
6Blink Charging Co.
7Ørsted A/S
8Enphase Energy Inc.
9Sunrun Inc.
10Ceres Power Holdings Plc

Garnry summarised how different areas of green energy stocks have fared through 2021 and why Tesla has driven the popularity of electric vehicle shares in Saxo Group’s new Future of Energy Q&A.

“It has been a quite dramatic year for the green sector. Primarily due to the increase in commodity prices, solar power has been hit quite hard this year and it has in general taken its toll on energy-producing sectors.”

“The most successful aspects of the green transformation in 2021 have been the green transformation services area as well as the battery and energy storage area, which makes sense as it is connected to the electrical vehicle development,” said Garnry.

“It is evident that Tesla usually is in the top five of people’s holdings and then there’s a natural spill-over effect to other electrical carmakers. It is quite remarkable to see how much the overall valuation of the car industry has gone up since electrical vehicles started to become a thing even though the output hasn’t followed suit. If the market is right, this means that car makers will be able to make larger profits creating electrical vehicles than petrol-fuelled ones.”

Greenwashing

While there are clear incentives for companies to go green, the risk if them labelling themselves as environmentally conscious without their actions matching their words, remains.

Garnry suggests that this is something investors should consider when making decisions.

“That’s why the term greenwashing has come to life. It is the act of companies stating they are green without having true proof of it. This is something that investors and people in general need to be aware of.”

NFT sales soar as question mark remains over signs of a bubble

Liam Roche
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NFT sales soar as question mark remains over signs of a bubble

NFT Sales

Sales of non-fungible tokens (NFT) rose sharply in August as investors increasingly put faith in the sector continuing to increase in value.

Sales volumes, as monitored by OpenSea, one of the largest NFT platforms, reached $1.9bn in August. This is an increase of more than ten times when compared to March, when the sales reached $148m.

Going back to January, monthly sales were slightly above $8bn.

The surge was a result of secondary market sales, OpenSea said.

“What we have seen are a few NFT collections popping up in the last few weeks that have been very successful at launch and sold out. That activity has then filtered over to OpenSea where buyers look to flip their NFTs for a higher price,” said Ian Kane, a spokesman for DappRadar, which tracks the market, told Reuters.

DappRadar said there were 32 known NFT sales valued at more than $1m in the past 30 days.

What is an NFT?

NFT, or non-fungible token, is a digital asset with unique properties that cannot be interchanged with something else. They are often thought of as a certificate of ownership for either a virtual or physical asset.

While digital files can be easily copied, NFTs can be “tokenised” to provide a digital certificate of ownership, which can ten be traded.

Similar to Bitcoin or other cryptocurrencies, a record of the ownership is stored on a ledger, or the blockchain.

NFTs can also align with smart contracts, allowing artists to generate revenue from future use of their respective tokens.

Bubble?

Question marks remain over the efficacy of the industry, which many say is a ‘bubble’.

Michael Every, head of financial markets research for Asia-Pacific at Rabobank, described the NFT market as “bubblicious stupidity”.

Every suggested that the vast sums generated in a short period of time are attractive to young people who may otherwise struggle to build wealth, however, he said it was similar to buying a lottery ticket.

He expects the NFT bubble will “absolutely pop”.

Investing in InsurTech with Quotall’s Simon Ball

UK Investor Magazine
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Investing in InsurTech with Quotall’s Simon Ball

The UK Investor Magazine Podcast is joined by Quotall’s Simon Ball to explore InsurTech and Quotall’s crowdfunding campaign on Seedrs.

Quotall’s unique insurance ecosystem of Insurtech and services provides businesses with everything it needs to sell insurance digitally.

In this Podcast, Simon announces a significant milestone in a partnership with WH Smith and explains the opportunity for potential investors in Quotall.

We discuss Quotall’s revenue model and highlight the attractiveness of reoccurring revenue possibilities with insurance renewals.

Find more information at:

https://quotall.com/

https://www.seedrs.com/quotall

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