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FTSE Down, BOE's Inflation, Interest-Rate Outlook Key For Long-Dated Gilts

11/03/2021 | 09:34am EDT

BOE's Inflation, Interest-Rate Outlook Key For Long-Dated Gilts

The Bank of England's inflation projections and expected path of the future policy rate will be more important for the direction of long-term gilt yields than Thursday's rate decision itself, says Pimco's portfolio manager Peder Beck-Friis. "The market will be paying close attention to the BOE's long-term inflation forecast, which is conditional on the market path of interest rates," he tells Dow Jones Newswires. If the BOE's inflation forecast is below 2% at the end of the forecast horizon, it "may signal that BOE thinks that the market is pricing too many [interest-rate] hikes," he says. He adds that the market is pricing 120 basis points of interest-rate rises by the end of 2022. This would take the bank rate to 1.30%.

 
Companies News: 

Esken 1H 2022 Pretax Loss Narrowed; Aviation's Outlook Turning Positive

Shares in Esken Ltd. rose Wednesday after it said that its first-half fiscal 2022 pretax loss narrowed after booking lower costs, and that the outlook for aviation is becoming more positive on eased travel restrictions and the rollout of coronavirus vaccination programs.

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Pipehawk FY 2021 Profit Narrowed on 1H Pandemic Hit But 2H Improved

Pipehawk PLC said on Wednesday that its profit for fiscal 2021 more than halved as revenue fell but its performance during the second half of the year returned to near pre-pandemic levels.

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Airtel Africa Sells Madagascar Tower Company to Helios Towers for $51.7M

Airtel Africa PLC said Wednesday that it has sold its telecommunications tower company in Madagascar to Helios Towers PLC for $51.7 million.

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Kodal Minerals Acquires Minority Shareholdings in Mali Project for $1.2 Mln

Kodal Minerals PLC said on Wednesday that it has acquired the minority shareholdings of Mali's Bougouni lithium project for $1.2 million, and that this has resulted in the company having a 100% interest in all of the project's concessions.

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Energean Says FY Performance Beat Record, 3Q Was Strong

Energean PLC said Wednesday that it continued to deliver strong operational and financial results in the third quarter of the year, boosted by higher commodity prices and above-expectations production.

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Goldplat Says 1Q Combined Operating Profit From Recovery Operations Unchanged

Goldplat PLC said Wednesday that its recovery operations achieved the same combined operating profit for the first quarter of fiscal 2022 when compared with the year-earlier period.

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Dalata Hotel Agrees on Debt Extension; Appoints Conal O'Neill COO

Dalata Hotel Group PLC said Wednesday that it has agreed on a one-year extension on its debt facilities with its banking partners, and that Conal O'Neill has been appointed chief operations officer effective Jan. 1.

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Pelatro's Nic Hellyer Becomes Full-Time CFO

Pelatro PLC said Wednesday that part-time Chief Financial Officer Nic Hellyer has agreed to increase his commitment to a full time role.

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Braemar Shipping 1H Pretax Profit, Revenue Rose; On Track to Meet Views

Braemar Shipping Services PLC said Wednesday that its pretax profit and revenue rose after refocusing on its core shipbroking and corporate finance business, and said it was on track to meet upgraded expectations.

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Nanoco Group FY 2021 Pretax Loss Narrowed After Cost Cuts

Nanoco Group PLC said on Wednesday that its fiscal 2021 pretax loss narrowed as it booked lower costs after restructuring part of the business.

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Financial System Makes Big Promises on Climate Change at COP26 Summit-- 2nd Update

Most of the world's big banks, its major investors and insurers, and its financial regulators have for the first time signed up to a coordinated pledge that will incorporate carbon emissions into their most fundamental decisions.

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Amryt Pharma 3Q Net Loss Widened on Higher Costs; Revenue Rose

Amryt Pharma PLC on Wednesday reported a widened third-quarter net loss as it booked higher costs and it backed its full-year revenue guidance.

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Anglo American CEO to Retire After Reviving Mining Giant

Anglo American PLC said Chief Executive Mark Cutifani would retire next year, ending a near-decadelong reign that revived one of the mining industry's most storied names.

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Cairn Energy to Pay Special Dividend in Early 2022 from Indian Tax Refund

Cairn Energy PLC said Wednesday that it will start filing documentation with the government of India in order to enable the refund of an estimated $1.06 billion in taxes and the payment of a special dividend next year.

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MaxCyte Names Richard Douglas Chairman

MaxCyte Inc. said Wednesday that it has appointed nonexecutive director Richard Douglas as chairman, succeeding J. Stark Thompson, who said on Oct. 1 that he wouldn't seek re-election after the company's annual general meeting.

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Daily Mail & General Agrees to Raised Buyout Offer from Rothermere

Daily Mail & General Trust PLC said Wednesday that major shareholder Rothermere Continuation Ltd. has made a recommended cash offer for the company at 255 pence a share.

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U.K. Investigators Examine Visits by Barclays CEO Jes Staley to Jeffrey Epstein's Island

U.K. investigators are examining visits by Barclays PLC Chief Executive Jes Staley to Jeffrey Epstein's private Caribbean island as part of a probe into whether Mr. Staley told the truth about his association with the convicted sex offender.

 
Market Talk: 

UK Yield Curve 'Twist' May Not Last, Columbia Threadneedle Investments

1346 GMT - The U.K. yield curve, which plots the yields of all of the country's debt securities, has twisted and flattened recently, with long-dated yields dropping as short-dated yields rose, forming a twisting action. But Columbia Threadneedle Investments fixed income portfolio manager Alexander Batten says it may not last. Aggressive pricing of interest-rate rises have driven shorter-term yields higher, while a sudden bigger-than-expected cut to this fiscal year's planned gilt sales pushed longer-term yields lower. However, if the Bank of England's inflation forecasts due Thursday show that the central bank predicts inflation to fall below its 2% target in 2024, it would send "a very clear signal" that the market "has got ahead of itself," he says. This would prompt the yield curve to steepen.

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Morgan Sindall's Future Looks Brighter Despite Inflation Concerns

1232 GMT - Morgan Sindall's third quarter update shows performance slightly ahead of expectations while increasing input costs look manageable, Liberum says. Despite the U.K. construction company's expectations being tempered by inflation, the brokerage increases 2021 and 2022 forward earnings per share expectations by 5% to 224 pence and 212 pence, respectively, due to strength in its construction businesses and Fit Out division. However, they still expect 2022 forward earnings per share to fall 6% year-on-year as strength in these divisions "may not be repeated," Liberum says. The brokerage retains its hold rating on the stock, but reduces its target price to 2250 pence from 2600 pence to reflect sector-wide reratings.

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No UK Rate Rise This Year Could Fuel Inflation Expectations

1126 GMT - Bank of England policymakers risk fueling inflation expectations if they don't raise interest rates this year, says Peder Beck-Friis, portfolio manager at Pimco. BOE Governor Andrew Bailey's comment in the run-up to this week's policy meeting that the central bank "will have to act" to tackle soaring inflation prompted traders to price in a higher chance of a near-term rate rise followed by further rate increases next year. "With the market now pricing 30bps of hikes by December, it will be a communication challenge for the BOE to not deliver a hike in the next two meetings, without leading to another leg higher in inflation expectations," he says.

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CLS Maintains High Rent Collections Amid Improving Activity

1055 GMT - CLS Holdings continues to achieve sector-leading rent collection rates with improving activity levels in the U.K., Germany and France expected to lead to a reduction in vacancy by year-end, Liberum says. The commercial-property investment company's portfolio repositioning continues with good progress on developments and refurbishments, while a further update on real-estate trust conversion for the U.K. business is expected in the next few weeks, Liberum says. CLS's shares look cheap with a sizeable 28% discount to its net development value, which doesn't reflect earnings upside from improving market conditions over the next year, the brokerage says. Liberum retains its buy rating and target price of 290.0 pence. Shares are up 0.2% at 219.5 pence.

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Land Securities Signals More Moves into Mixed-Use Development

1044 GMT - Land Securities' strategic acquisition of a 75% stake in the MediaCity hub in Greater Manchester for GBP425.6 million heralds another major move into mixed-use development, Goodbody says. The commercial-property developer and investment company's strategic acquisition of the site includes 11 buildings, comprising workspace, studios, labs, residential and ancillary leisure and retail space, all of which is 96% let and generates GBP31.1 million in net operating income a year, the Irish brokerage says. "LandSec's purchase of MediaCity adds further significant mixed-used exposure from an immediately income producing asset, with further development potential in a strong, dynamic regional city," Goodbody says, retaining its buy rating on the stock.

Contact: London NewsPlus, Dow Jones Newswires; Write to Sarka Halas at sarka.halas@wsj.com

(END) Dow Jones Newswires

11-03-21 1034ET

Stocks mentioned in the article
ChangeLast1st jan.
AIRTEL AFRICA PLC 1.57% 155 Delayed Quote.14.14%
ANGLO AMERICAN PLATINUM LIMITED -0.77% 1587.71 End-of-day quote.-12.61%
ANGLO AMERICAN PLC 2.33% 3709 Delayed Quote.20.18%
AUSTRALIAN DOLLAR / BRITISH POUND (AUD/GBP) -0.56% 0.56296 Delayed Quote.5.16%
BARCLAYS PLC 0.97% 164.36 Delayed Quote.-12.95%
BRAEMAR SHIPPING SERVICES PLC -0.91% 272.5 Delayed Quote.1.29%
CANADIAN DOLLAR / BRITISH POUND (CAD/GBP) -0.11% 0.621172 Delayed Quote.6.38%
CAPRICORN ENERGY PLC 1.72% 201.2 Delayed Quote.5.05%
CLS HOLDINGS PLC -0.45% 221.5 Delayed Quote.1.83%
DALATA HOTEL GROUP PLC 4.55% 4.025 Real-time Quote.3.49%
DOW JONES AFRICA TITANS 50 INDEX -0.87% 502.02 Real-time Quote.-5.57%
ENERGEAN PLC 2.24% 1369 Delayed Quote.56.61%
EURO / BRITISH POUND (EUR/GBP) -0.61% 0.85049 Delayed Quote.1.18%
GOLDPLAT PLC -2.33% 8.4 Delayed Quote.22.86%
HELIOS TOWERS PLC -0.36% 111.3 Delayed Quote.-35.06%
INDIAN RUPEE / BRITISH POUND (INR/GBP) -0.13% 0.010278 Delayed Quote.3.26%
KODAL MINERALS PLC -1.85% 0.265 Delayed Quote.-12.20%
LAND SECURITIES GROUP PLC 0.21% 757 Delayed Quote.-2.70%
MAXCYTE, INC. -3.49% 357.08 Delayed Quote.-50.99%
NANOCO GROUP PLC 1.24% 36.75 Delayed Quote.76.21%
PELATRO PLC 0.98% 25.75 Delayed Quote.-15.00%
PIPEHAWK PLC 0.00% 17.5 Delayed Quote.0.00%
S&P AFRICA 40 INDEX -1.19% 161.05 Real-time Quote.-6.89%
US DOLLAR / BRITISH POUND (USD/GBP) 0.07% 0.797925 Delayed Quote.7.65%
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