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FTSE Rises, Reopening Delay Unlikely to Meaningfully Impact Pound

06/15/2021 | 06:20am EDT

England Reopening Delay Unlikely to Meaningfully Impact Pound

The four-week delay to the final easing of England's coronavirus restrictions is unlikely to meaningfully impact monetary policy or the pound, MUFG Bank says. The delay should modestly dampen economic growth in June and July but overall it won't have much impact, MUFG's Lee Hardman says. The spread of the Delta Covid-19 variant will prove more disruptive in countries where vaccine programs aren't as advanced as in the U.K., he says. "We have maintained our long cable trade idea but acknowledge that the balance of risks has become less favorable in the near-term." A long position bets on an asset price rising. GBP/USD is flat at 1.4106 and EUR/GBP rises 0.2% to 0.8606.

 
Companies News: 

MGC Pharmaceuticals CannEpil Treatment Added to Irish Healthcare Service

MGC Pharmaceuticals Ltd. said Tuesday that its medicinal cannabis product CannEpil, designed to treat refractory epilepsy, has been added to Ireland's Primary Care Reimbursement Service.

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Norman Broadbent Appoints Peter Searle as Executive Chairman

Norman Broadbent PLC said Tuesday that it has appointed Peter Searle as executive chairman.

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Northbridge Industrial Services 1H 2021 Earnings Higher Than 1H 2020

Northbridge Industrial Services PLC said Tuesday that revenue and adjusted pretax profit for the first half of 2021 are above those from a year earlier, and on track to meet management expectations.

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APQ Global Names New Finance Director

APQ Global Ltd. said Tuesday that Finance Director Wesley Davis is stepping down from the role and will be replaced by Philip Soulsby.

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CML Microsystems FY 2021 Profit, Revenue Fell; Declares Special Dividend

CML Microsystems PLC said Tuesday that fiscal 2021 pretax profit and revenue fell, but declared a special dividend of 50 pence.

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Renalytix AI 3Q Net Loss Widened on Higher Expenses

Renalytix AI PLC said Tuesday that its net loss for the third quarter of fiscal 2021 widened sharply as the company booked higher research-and-development expenses as well as general and administrative costs.

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Sistema 1Q Net Loss Narrowed

Sistema JSFC said Tuesday that its net loss narrowed in the first quarter of 2021 as revenue rose, and that it expects 2021 revenue growth of no less than 4% for its telecommunications company, MTS.

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Pressure Technologies Shares Fall on Lower 2H Outlook; Swung to 1H Profit

Pressure Technologies PLC shares fell Tuesday after it said that it swung to a first-half pretax profit, but it lowered its expectations for the second half.

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UK Regulator to Probe NCR Corp.'s $2.5 Bln Cardtronics Acquisition

The U.K. Competition and Markets Authority said Tuesday that it has started an investigation into NCR Corp.'s $2.5 billion acquisition of ATM operator Cardtronics PLC to see if the deal will lead to a "substantial lessening" of competition.

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Sistema Increases Share Buyback to Maximum of RUB7 Bln

Sistema JSFC said Tuesday that it is increasing its share buyback program to up to 7.0 billion rubles ($97 million) until September 2022.

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Triad Group Shares Rise on Swing to Pretax Profit, Cash Increase

Shares in Triad Group PLC rose 13% Tuesday after the company reported a swing to pretax profit for fiscal 2021 due to lower costs, and said that its cash has increased significantly on the back of the move to profit as well as improvements in working capital.

 
Market Talk: 

Boohoo's Publication of Suppliers Should Boost Investor Sentiment

0951 GMT - Boohoo's list of global suppliers, to be made public in September, will alleviate many of its reputation issues, says Richard Hunter, head of markets at Interactive Investor. The fashion retailer's first-quarter revenue rose significantly, but some of this progress was reduced by the sustainability issues it faced. "At the same time, rectifying the reputational damage remains a work in progress and the share price has declined by 10% over the last year, during which time the wider FTSE AIM 100 index has surged ahead by 38%," Hunter says, while also noting that its share price remains up by 49% over the last two years. Hunter notes the market widely has a buy recommendation on the stock of Boohoo.

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Bellway's Share Price Looks Well Supported

0948 GMT - House builder Bellway's share price should be well underpinned by the expected delivery of growth over the medium term and a decent dividend payout, Canaccord Genuity says. Bellway has guided for a higher average selling price for fiscal 2021 and pretax profit consensus forecasts for the year are likely to rise 3%-4%, but don't expect any material changes to fiscal 2022 at this stage, the Canadian investment bank says. Bellway's share price has risen around 18% in the year to date but it still has one of the lowest price-to-book multiples in the sector, adding to its attractiveness, Canaccord says. Canaccord retains its buy rating and 4,060-pence price target on the stock. Shares are broadly flat at 3,482 pence.

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Bellway Looks Underrated Given Potential Growth, Numis Says

0941 GMT - House builder Bellway's momentum and longer-term growth potential is not reflected in its deep share-price discount to the wider sector, Numis says. Bellway has guided for higher average sales price for fiscal 2021, and as such the brokerage raises its pretax profit forecasts for fiscal 2021 and 2022 by 3% and 4% respectively. Forecasts for Bellway's fiscal 2022 are still set a very cautious level, particularly in light of the substantial landbuying undertaken since the first lockdown, Numis says. Numis retains its add rating and target price of 4,102 pence. Shares are down 0.2% at 3,473 pence.

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Bellway Likely to See Profitability Expectations Climb on New Guidance

0936 GMT - House builder Bellway experienced seen good trading since February, retaining its full-year volume outlook and raising its average selling price guidance, making a rise in consensus views on profitability likely, Goodbody says. Bellway's more favorable mix is likely to see consensus profitability views rise by 1%-2%, the brokerage says. Demand has normalized in recent weeks according to Goodbody's proprietary new-build data and Bellway's reservation rates point to a similar trend, the brokerage says. "That said, this could be a function of just how low stock levels are in which context the orderbook gives comfort that demand is still robust," Goodbody says, retaining its buy rating on the stock. Shares rise 0.1% to 3,483 pence.

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UK Events Body Says Reopening Delay Could Be 'Fatal' to Companies

0837 GMT - The U.K.'s Events Industry Alliance says the four-week delay to ending Covid-19 restrictions in England risks hurting the confidence of customers and companies in the sector. "We understand the balance the government needs to take but this further delay risks striking a fatal blow to many companies in the U.K. events sector and it is essential that support measures are extended to match this new roadmap," says a spokesperson for the Events Industry Alliance, which represents the U.K.'s event and exhibitions organizers, venues, and suppliers. U.K. Prime Minister Boris Johnson on Monday delayed a long-awaited end to Covid-19 restrictions in England following an upswing in cases of a more contagious variant of coronavirus.

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UK Strong Wage Growth Isn't Expected to Fuel Inflation

0834 GMT - The U.K.'s average earnings growth rate climbed to 5.6% in April from 4.0% in March, but the rise is partly due to base effects from April's 2020 slump and many low-paid workers having lost their jobs, Thomas Pugh, U.K. economist at Capital Economics, says. Underlying pay growth was around 3% in April, so concerns about the effect of higher wage growth on inflation are overstated, he says. "We think there is enough slack in the labor market to prevent a big rise in underlying pay putting upward pressure on inflation," Pugh says.

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UK Higher Pay Growth Could Be Great News for UK Economy

0835 GMT - The U.K. unemployment rate fell for a fourth consecutive month to 4.7%, which could be another encouraging release on the U.K. labor market if it weren't for the 8% of the workforce still on furlough programs, HSBC says. Regular pay in the three months to April was up 5.6% year-on-year. "If sustained, higher pay growth could be better news for the U.K. economy than the savings accumulated as a consequence of the lockdowns," Elizabeth Martins, senior economist at HSBC, says. But HSBC warns that there is still a lot of uncertainty, such as how many of the furloughed jobs will prove viable or the extent to which tightness in the labor market will weigh on companies.

Contact: London NewsPlus, Dow Jones Newswires; +44-20-7842-931

(END) Dow Jones Newswires

06-15-21 0619ET

Stocks mentioned in the article
ChangeLast1st jan.
AURORA CANNABIS INC. -4.77% 8.59 Delayed Quote.-16.13%
BOOHOO GROUP PLC -4.19% 267.3 Delayed Quote.-18.66%
CANOPY GROWTH CORPORATION -6.51% 23.11 Delayed Quote.-21.07%
CRONOS GROUP INC. -1.86% 8.95 Delayed Quote.3.17%
HSBC HOLDINGS PLC 0.10% 403.3 Delayed Quote.6.35%
NCR CORPORATION -1.24% 44.54 Delayed Quote.20.04%
ORGANIGRAM HOLDINGS INC. -4.33% 3.09 Delayed Quote.91.12%
SUPREME CANNABIS 1.52% 0.335 End-of-day quote.112.90%
THE SEARLE COMPANY LIMITED 0.73% 241.64 End-of-day quote.-3.05%
TRIAD GROUP PLC 0.00% 102.5 Delayed Quote.105.00%
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