Antofagasta reduces guidance despite surge in profit

Liam Roche
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Antofagasta reduces guidance despite surge in profit

Antofagasta share price down by over 5% on Thursday morning

Antofagasta (LON:ANTO) revealed its profits doubled during H1 thanks to the rising price of copper, however the Chilean miner reduced its production guidance.

The FTSE 100 company also said that it plans to raise its interim dividend payment to investors on the back the surging price of copper, which rose by 19% during the first half of the year.

Revenue for the first six months of 2021 was $3.6bn, an increase of 68% compared to the same period a year ago, while the firm’s pre-tax profit rose to $1.8bn.

Shareholders received a generous payout of 23.6 cents per share, which was a rise of 281% compared to the year before.

Anto is the latest miner to reveal healthy results thanks to rising commodity prices as economies around the world have been opened up as coronavirus restrictions have been reduced.

Antofagasta plc CEO Iván Arriagada said: “We have seen strong copper demand and prices at multi-year highs over the first half of this year which has contributed to the robust financial performance of the Group.”

However, there have been adverse conditions for Antofagasta to contend with, which has resulted in its profit guidance being lowered.

“The half year was not without challenges as we continued to manage our operations and projects under Covid-19 conditions, although the resilience and agility of the group has resulted in costs below guidance,” Arriagada added.

The Antofagasta share price is down by 5.07% during the morning session on Thursday.

Lloyds to acquire 50,000 homes in bid to become major landlord

Liam Roche
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Lloyds to acquire 50,000 homes in bid to become major landlord

Lloyds diversifying away from traditional sources of income

Lloyds is seeking to become on of the largest landlords in the UK as the major bank will buy 50,000 homes in the next ten years, it has been reported.

In an effort to diversify away from traditional lending as a source of income, which is not as fruitful at the moment due to low interest rates, Lloyds has entered the private home rental market.

The Financial Times reported that Citra Living brand, under which Lloyds operates, has set a “strategic challenge” of acquiring 10,000 properties before the end of 2025. By 2030 the FTSE 100 bank will aim to reach 50,000 properties.

Estimates suggest that Citra’s balance sheet would be valued in the region of £4bn, generating around £300m in profit before tax.

William Chalmers, Lloyds’ chief financial officer, told analysts a month ago that “we are keeping this on a limited basis while we explore the area, while we allow ourselves to learn from it”.

Recent changes to the tax system have led to there being fewer smaller-level landlords who previously made up the rental sector in the UK. Instead, larger companies have moved in due benefit from a shortage in housing and a rise in the number of families renting.

Lloyds said: “As highlighted at launch, Citra Living will initially start small, with a focus on buying and renting good quality newly built properties. This will be achieved by working alongside leading housebuilders to address the increasing demand for rental properties, and the aim is to gradually provide incremental stock to the UK rental market over the coming years.”

Director deals: Trident Royalties

Andrew Hore
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Director deals: Trident Royalties

Trident Royalties (LON: TRR) directors have been buying shares during August following a dip in the share price over the past two months. They have invested in excess of £500,000.
New non-exec Peter Bacchus has bought an initial 175,000 shares at 34p each. Former Glencore Paul Smith became non-exec chair earlier this year. When he joined Paul Smith subscribed £1m for shares at 40p each. He has added 775,000 shares at 34p each and he owns more than 3.3 million shares (1.84%). He also has options over 175,000 shares at 51.66p each, that relate to finance provided by a debt syndicate.
Another non...

BP share price being sustained by oil as company transitions to renewables

Liam Roche
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BP share price being sustained by oil as company transitions to renewables

BP Share Price

The BP share price (LON:BP) has given away 0.89% at the time of writing on Wednesday as speculation over an oncoming upwards surge mounts around the oil giant. It has been a pretty solid year so far for the FTSE 100 company which is up by 17.78%, as oil prices have increased on a resurgence in demand.

While the price of oil and environmental concerns remain a threat to the BP share price, the company has a plan to see it through the coming months. This is causing many analysts to tip BP as being one to watch. Stockopedia reported this week that the BP share price has 6 Buy, 10 Hold and 0 Sell recommendations from analysts.

Oil

For now, the oil price is approximately at its pre-pandemic level, which bodes well for BP.

The International Energy Agency said last week that raised demand for crude oil switched back in July and it now expects demand for the commodity to rise at a slower rate for the remainder of 2021. This is down to the prevalence of the Delta variant of the coronavirus.

The news raises question marks over the near-term outlook for oil after Joe Biden called on OPEC and its allies to raise its levels of output in a bid to keep rising fuel prices under control, as inflation in America reaches its highest yearly growth rate in 13 years.

However, some analysts remain bullish on the commodity despite some recent bad news.

Bank of America commodities strategist Francisco Blanch is making the case of $100 per barrel oil in 2022 as supply will begin to fall.

While the longer-term outlook remains uncertain, for now, the BP share price will be sustained by raised oil prices. Its goal will be to use its revenues to smoothly transition into the future of renewable energy.

The Future

Bernard Looney, the BP chief executive, has continued to redirect the company towards renewable energy since he took up his position last year.

Higher oil prices, on which BP remains reliant, have allowed the company to increase its investment in offshore wind, solar energy and hydrogen.

This in itself could be the source of additional investment for the FTSE 100 oil giant.

Taking advantage of current oil prices, while not waiting too long to transition, will be a key play which could influence the BP share price over the coming months.

Ethereum leading the way in August and could reach its all-time high before Bitcoin

Liam Roche
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Ethereum leading the way in August and could reach its all-time high before Bitcoin

96% of Ethereum investors are in the black

August 2021 has seen more Twitter posts with the hashtag Ethereum than ever before.

On 5 August there were a total of 59,950 tweets with the hashtag, as its ‘London upgrade’ and upward price movements have caused frenzy around the cryptocurrency.

Ether has recorded strong levels of growth over the past month, outperforming both Bitcoin and XRP.

According to data gathered by Block-Builders.net, 96% of Ethereum investors are in the black. This figure falls to 85% and 68% for Bitcoin and Cardano respectively.

The majority of the cryptocurrency scene is generally optimistic about Ethereum at the moment. The Fear & Greed Index is at 74, compared to 71 for the crypto market as a whole. The maximum value of 100 represents the greatest possible euphoria among investors.

“Bitcoin is still well ahead in terms of market capitalisation,” adds Block-Builders analyst Raphael Lulay. “However, more and more market observers consider it possible that Ethereum will one day overtake Bitcoin.”

Recent analysis has suggested that Ether, Ethereum‘s native token, could outpace Bitcoin to a new all-time high.

Ki Young Ju, CEO of on-chain analytics service CryptoQuant, tweeted on Wednesday highlighting a “sell-side liquidity crisis” that could yet give Ethereum the edge over Bitcoin.

“$ETH might reach its all-time high earlier than $BTC in the long term,” Ki said.

This is in part due to supply changes brought about thanks to the recent hard fork, which could cause a shortage of supply, pushing Ethereum to a new high.

At the time of writing, the price of Ethereum stands at $3,057.84.

Novacyt share price surges as company announces 50% increase in revenue

Liam Roche
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Novacyt share price surges as company announces 50% increase in revenue

Novacyt Share Price

The Novacyt share price (LON:NCYT) was trading up on Wednesday as the biotech company delivered its trading update for the first half of the year. At the time of writing, the company has added 13.54% to its stock value. Despite the move today, year-to-date, the Novacyt share price is still down 59.76%. A wave of uncertainty gathered around the future direction of the company following the pandemic, causing its share price to dip in 2021. However, today’s update suggests a brighter outlook.

Trading Update

Novacyt reported on Wednesday that its revenue rose by 50% to £94.7m. The AIM-listed firm said that £54m came from the UK private testing market and overseas sales.

Its wholly-owned subsidiary Primerdesign was awarded a new contract under the Public Health England (PHE) National Microbiology Framework, effective immediately, for the supply of ‘PROmate’ Covid-19 tests to the NHS.

The PROmate tests were developed to run on the company’s ‘q16’ and ‘q32’ PCR instrument platforms.

Novacyt said the q16 and q32 near-patient PCR instrument platforms, using the PROmate Covid-19 test, had been validated and could be used at selected NHS hospitals.

The AIM-listed company has also entered into a two-year Long-Term Agreement (LTA) with the World Health Organization for the supply of its genesig COVID-19 tests. UNICEF has also confirmed that its existing LTA has been extended by 12 months to July 2022.

Graham Mullis, Group CEO of Novacyt, commented:

“Novacyt is continuing to address COVID-19 testing for both current and future demand. We continue to ensure that innovation is at the centre of our strategy and that our growing portfolio of COVID-19 tests are available to customers in both private and public health settings to expand existing, and support new, partnerships. Throughout the pandemic, NHS testing demand has remained a key priority for the Company and the contract award under the PHE National Microbiology Framework is a testament to our continued commitment.”

“We believe our long-term strategy also supports the growth of Novacyt post-COVID-19. In particular, our progress and growth potential in the private sector will not only help us maximize the COVID-19 testing opportunity but also ensure we are well placed, with both technologies and partners, for sustainable growth beyond COVID-19. We therefore believe Novacyt is well positioned to continue to build on its business transformation.”

UK House Prices, Persimmon and South American Energy with Alan Green

UK Investor Magazine
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UK House Prices, Persimmon and South American Energy with Alan Green

Alan Green joins the UK Investor Magazine Podcast in the midst of the summer lull in market with holidaying traders meaning lower volumes across markets and tepid price action.

Nonetheless, we have received strong data from the ONS on UK house prices that confirmed what most in the market had already knew; Uk house prices have soared boosted by Stamp Duty Holidays and lack of supply.

We discuss Persimmon (LON:PSN), Zenova Group (LON:ZED) and Echo Energy (LON:ECHO).

ONS: house prices rise at fastest rate in 17 years

Liam Roche
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ONS: house prices rise at fastest rate in 17 years

Average house price reached £266,000 in June 2021

The average price of a house in the UK is up by 13.2% for the year to June 2021.

It is the highest level of yearly growth seen in the UK since November 2004 according to the Office for National Statistics (ONS) House Price Index.

House prices are £31,000 higher than this point last year, reaching a record high level of £266,000 in June 2021.

London remains the region with the lowest yearly growth, at 6.3%, for the seventh month in a row.

However, the capital remains the most expensive of any region across the country with an average price of £510,000 recorded in June.

Hugh Gibbs, co-founder of SearchLand, said: “House prices always consume a lot of attention in the UK, and that is particularly true right now, with homebuyers, investors and developers eagerly waiting to see the impact of the first stamp duty holiday deadline.”

“Clearly, the ONS data shows us that even in the build-up to the deadline on 30 June, house price growth continued its rapid march upwards – although this is a trend that is unlikely to have continued into July and August.”

The statistics suggest that the stamp duty holiday has more than achieved its aim.

“It has incentivised a huge amount of transactional activity and fuelled growth across the property sector. And, while the remarkable surge in property values over the past 14 months will eventually come to an end, the predictions of a sudden market crash this summer have certainly not come to fruition,” said Gibbs.

“Make no mistake, the market remains highly competitive even as the stamp duty holiday tapers down, with desirable properties and land still attracting a great deal of attention from prospective buyers. Do not expect this to change any time soon.”

UK inflation comes in at target level of 2%

Liam Roche
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UK inflation comes in at target level of 2%

There have been suggestions that the respite in inflation is only temporary

There was a pause in inflation levels on Wednesday as the CPI rate arrived below expectations at 2%.

Analysts were expecting a recording of 2.3% for last month, 0.2% below the inflation figure recorded in June.

According to the Office for National Statistics, clothing and footwear prices were subdued, helping to keep inflation rates down.

However, there have been suggestions that the respite is only temporary with businesses set to face rising costs.

Commenting on the UK CPI slowing to 2%, Ian Warwick, Managing Partner at Deepbridge Capital, said “While inflation may have slowed slightly to fall within the Bank of England’s target of 2% this does not mean that rates won’t pick up over the coming months. Many early-stage businesses will be thriving in the recently reopened economy, but they will continue to watch the debate around the decision on a subsequent rise in interest rates very closely as this will directly impact how much they are able to borrow at a crucial time.”

With inflationary pressure continuing, it also raises the question of exactly how long the Bank can hold interest rates at current levels before it is forced to step in.

“This could cause a problem for growing, early-stage companies who require access to funding as we focus on economic recovery. It therefore remains critically important that scale-up businesses, particularly in high-growth sectors such as digital technologies and life sciences are supported as they will be at the very heart of economic growth as we create an economy fit for the twenty-first century,” Warwick says.

The Bank of England says that inflation will rise to 4% by the end of 2021, double its target, while there are concerns that it could go even higher.

ONS Deputy National Statistician Jonathan Athow said: “Inflation fell back in July across a broad range of goods and services, including clothing, which decreased with summer sales returning after the pandemic hit the sector last year.”

“This was offset by a sharp rise in the price of second-hand cars amidst increased demand, following a shortage of new models.”

FTSE 100 dips on UK inflation retreat

Liam Roche
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FTSE 100 dips on UK inflation retreat

The FTSE 100 is down by 0.4% to 7,152 points during the morning session on Wednesday as UK inflation eased back more than anticipated.

“This is good news for those fretting about rising prices but potentially raises some questions about the strength of the UK economic recovery,” says AJ Bell investment director Russ Mould.

Mining firm BHP proved to be a drag on the index after confirmation yesterday that its corporate restructuring would mean an exit from the FTSE 100 as the primary listing for the shares goes to Australia.

“This move will mean products which track the FTSE 100 and funds with investment policies barring them from buying shares with their main listing overseas will have to exit their shareholding,” says Mould.

“The turmoil in Afghanistan and continuing threat posed by the Delta variant of Covid is seeing funds flow into the dollar – a traditional safe haven – with Chinese and US equities both falling overnight.”

FTSE 100 Top Movers

Leading the way on the FTSE 100 is Ocado (1.22%), Just Eat (0.97%) and Vodafone (0.81%).

BHP (-3.83%), Persimmon (-2.44%) and Evraz (-2.12%) are dragging on the FTSE 100 on Wednesday, as the day’s top fallers so far.

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