This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping us understand which sections of the website you find most interesting and useful. See our Cookie Policy for more information.
Strictly Necessary and Functional
These cookies are used to deliver our website and content. Strictly necessary cookies relate to our hosting environment, and functional cookies are used to facilitate social logins, social sharing and rich-media content embeds.
Advertising
Advertising Cookies collect information about your browsing habits such as the pages you visit and links you follow. These audience insights are used to make our website more relevant.
Performance
Performance Cookies collect anonymous information designed to help us improve the site and respond to the needs of our audiences. We use this information to make our site faster, more relevant and improve the navigation for all users.
Pharma & Biotech
Coronavirus
Cannabis
Battery Metals
Psychedelics
Pharma & Biotech
Coronavirus
Cannabis
Battery Metals
Psychedelics
16:45 Fri 24 Mar 2023
The FTSE 100 ended off the days lows but still 1.3% weaker at 7,405
The FTSE 100 ended off the days lows but still 1.3% weaker at 7,405 as the latest bout of banking havoc rattled investors.
“It looks like the banking crisis isn’t solved. Stocks are down heavily today, especially in Europe, as everyone’s struggler-of-choice Deutsche Bank sees its stock fall sharply,” commented IG’s Chris Beauchamp. “This renewed bout of selling shows that the takeover of Credit Suisse hasn’t put a lid on the crisis, and investors will go into the weekend hoping for some more calming words from authorities.”
By the UK close, US stocks had retraced most of their earlier losses. The Dow Jones Industrial Average was 0.2% down at 32,052, the S&P 500 was also 0.2% lower at 3,940 and the Nasdaq had shed 0.6% to 11,721.
The FTSE 100 edged back above the 7,400 level with around half an hour of a very depressing Friday session to go in London, with its losses now just double-digit rather than triple, but the mood still very glum amid fresh worries over the banking sector which has been battered hard again this week.
Neil Wilson, chief market analyst at Markets.com commented: “We’re down from the force 9 severe gales and structural damage of Monday morning but the calm has been disturbed again. Banking fears are once again gripping markets with Deutsche Bank in the spotlight for the wrong reasons. Shares ripped 14% lower, sending it down around 30% for the month.
“Credit default swaps in the bank have blown out to a four-year high, up to 198bps from around 142 Wednesday, and bonds tanked. Deutsche Bank announced its decision to redeem its $1.5bn Fixed to Fixed Reset Rate Subordinated Tier 2 Notes due 2028 at 100%. These bonds surged to more than 98 cents on the dollar, having slipped to 90 cents … but there is a sense that markets are asking why are you doing this? Are you trying to proclaim strength to hide something? Early redemptions can be viewed as negative signal that it expected dovishness to come.”
Wilson added: “DB is not entirely dissimilar to Credit Suisse – years of pain and restructuring – we were always joking that CS was the new DB. Is DB the new CS? Bill Winters at StanChart points out that the treatment of the AT1 bonds of CS will be profound and I think some of the price action we are seeing around DB assets today is a reflection of investors needing to view those bonds as not as safe as equity. This is the sort of unanticipated consequence of the CS bailout/forced marriage”.
Bank of England (BoE) Monetary Policy Committee member Catherine Mann has said she voted for a 25-basis-point rate rise this week rather than a bigger increase because she saw signs that inflation expectations were falling, Reuters reported.
Speaking at a panel discussion hosted by the University of South Florida, Reuters noted that Mann said the BoE had raised interest rates more slowly than she would have liked in 2022, but that she voted with the majority for a quarter-point increase to 4.25% this week because businesses’ and consumers’ expectations for future inflation had dropped.
“A key factor for me in agreeing with and also voting (with) the majority for a 25 basis point increase at the last meeting … was that these forward-looking measures of price expectations … had started to moderate, which is exactly the signal to me that my monetary policy is having an effect,” she added, according to the report.
Private-sector landlords in England increased rents on more than half of homes in the year to February, up from just over a third a year earlier, further tightening the squeeze on households amid a cost of living surge, according to an analysis by The Office for National Statistics (ONS), Reuters reported.
The ONS, which analysed data collected every 12 months about privately-rented homes, revisiting the properties to track price changes over time, said that among homes visited in February 2023, 50.6% had seen an increase in rents in the past year, up from 36.0% in February 2022.
In London, the proportion was even higher, with rents rising on 66.8% of properties. The ONS said the size of London’s private rental market had a strong influence on the English average, and noted that rents had fallen in the capital during the COVID-19 pandemic.
The average rent increase was 9.7%, up from 7.0% a year earlier. Rent increases were bigger in London, at an average of 12.0%.
Separate ONS data, published on Wednesday, showed private-sector rents for residential property across Britain as a whole grew by 4.7% in the 12 months to February – the largest annual increase since records started in 2016, Reuters noted.
Forget the banking contagion fears, that other one has reared its head again, as Covid is sweeping through England once more, with cases having climbed to their highest level since the start of the year.
Up to one in 40 people are infected with the virus across the country, according to surveillance data, the Dail Mail’s website reported, while as many as one in 17 are currently carrying it in the worst-hit areas of the country.
Office for National Statistics (ONS) analysts estimate almost 1.7mln Britons were carrying the virus on any given day in the week to March 13, 2023, a jump of almost 14% on the week before.
Leading experts fear the outbreak will continue to pick up pace in the coming weeks as part of the virus’s natural cycle, the Mail’s report said, and some have already called for the return of face masks.
Commenting on the fresh banking sector woes spurred by a probe into UBS and a spike in Deutsche Bank CDS’s, Susannah Streeter, head of money and markets, Hargreaves Lansdown: said: ‘”Revelations that white knight UBS, which had ridden to the rescue of Credit Suisse, is being investigated by the US Department of Justice has shaken sentiment further. The probe centres around allegations that staff helped Russian oligarchs evade sanctions. Concerns are also deepening around Deutsche Bank after the cost of insuring against defaults on its debt spiked, with credit default swap prices soaring.
“Worries about contagion are again rearing up even though more deposits appear to have been flowing into the German lender since the banking scare erupted, and it is thought to have capital reserves well in excess of regulatory requirements. These fresh problems are bubbling up in a cauldron of worry about the implications of the rate rises we’ve seen over the past week, given that earlier hikes appear to have caused breakages in parts of the banking system. There are worries that the fresh round of rate rises could make a precarious situation worse for some smaller banks, particularly those sitting on large bond holdings which have lost value as monetary conditions have been dramatically tightened.
She added: “Waves of bad news keep hitting the banking sector and the tide doesn’t look like it’s set to turn any time soon. However, the European Central Bank has made it clear that it is standing by ready to deploy fresh tools to boost liquidity should the situation deteriorate and President, Christine Lagarde, has again reassured EU leaders in Brussels that the banking sector remains resilient with strong capital positions. The message from the Bank of England has been on repeat over the past fortnight. Although it’s monitoring the situation it’s stressing that there is still no systemic risk and that the UK banking system remains safe and sound.’’
The FTSE 100 index remained above the hefty session lows of this morning but still notched up a triple-digit fall as Wall Street opened in the red as well with global markets roiled by renewed worries over contagion in the banking sector.
Around 45 minutes after the New York opening bell, the Dow Jones Industrials Average was down 202 points, or 0.6%, to 31,902, with the S&P 500 index and the Nasdaq Composite both off 0.5%.
After interest hikes this week by both the Bank of England and the Federal Reserve, investors are grappling with what central banks on both sides of the pond will do going forward amid the fresh fears about the global banking sector, as Deutsche Bank shares fell more than 6%.
“The Fed, SNB and BoE all hiked interest rates this week, but the message from these banks was the same: more increases may be required, not will be, if inflationary pressures persist,” said Fawad Razaqzada|, market analyst at City Index and Forex.com.
“However, the markets have started to price in rate cuts from the second half of this year, even though the Fed Chair said this was not discussed at their FOMC meeting this week, he added.
Around 2.15pm, the FTSE 100 index was down 114 points, or 1.5% at 7,384, albeit above the day’s low of 7,335.71.
Warpaint London PLC (AIM:W7L) saw its shares rally 5% higher to 207.5p after the owner of the W7 and Technic cosmetics brands said 2023 had started strongly and it now believes full-year results will exceed its previous expectations.
Gemfields Group Limited (AIM:GEM) saw its shares rise over 2.3% after it posted record revenue for 2022, exceeding the US$300mln mark for the first time, rising by 32% to US$341mln, up from US$257.7mln in 2021.
In The Style Group PLC (AIM:ITS) dove by 20% after announcing that, following the general meeting held earlier today, a sale resolution was passed by shareholders, but a share cancellation resolution did not pass. Accordingly, admission of the company’s ordinary shares to trading on AIM will not be cancelled on April 5 as previously suggested.
Phoenix Copper Ltd (AIM:PXC, OTCQX:PXCLF) Fell 22% after announcing it had entered into a short-term $2mln loan facility with Riverfort Global Opportunities in order to strengthen US dollar operational working capital ahead of the 2023 exploration season
In the US, durable goods orders unexpectedly fell by 1% in February from the month before, indicating that investment in business equipment was weakening even before the banking turmoil started.
Andrew Hunter, deputy chief US economist at Capital Economics, said: “With business confidence likely to have taken a hit in recent weeks and banks tightening lending standards further, we suspect business investment has further to fall.”
“The headline weakness was partly the result of aircraft, with Boeing booking only two orders last month resulting in a 6.6% m/m fall in the value of commercial aircraft orders. Those orders should see a big rebound soon, however, once the bumper order recently announced by Air India is finalised. Motor vehicle orders fell by 0.9%, while orders were also dragged down by an 11.1% drop in defence aircraft.”
Back in London and the FTSE 100 remains under pressure down 1.5%, off session lows.
Plenty of rumours surrounding why Deutsche Bak is falling with exposure to exposure to US real estate touted as one.
On CRE exposure, per Citi’s Andrew Coombs
-CRE is 7% of total loan book,:51% in the US, 36% Europe
-Weighted LTV is ~ 61% in IBank, 53% Corp Bank
– NPEs 2.1% as of June 2022
-NPE provisions coverage ratio of 20%, lower than the average of 50% pic.twitter.com/SuykDWQXdH
Wall Street is expected to open lower on ongoing concerns of further shocks to the global banking system following reports that UBS and Credit Suisse face a US Department of Justice investigation for allegedly helping Russian oligarchs evade sanctions and as Deutsche Bank’s shares fell sharply.
Futures for the Dow Jones Industrial Average (DJIA) fell 1% in Friday pre-market trading while those for the broader S&P 500 index shed 0.9% and contracts for the Nasdaq-100 retreated 0.5%.
European banking share prices came under fresh pressure on Friday as a spike in the cost of Deutsche Bank’s credit default swaps (CDS) sparked renewed concerns about the stability of the sector. The German bank’s additional tier one (AT1) bonds, an asset class that hit the headlines this week after the controversial write-down of Credit Suisse’s AT1s as part of its UBS rescue deal, also sold off sharply.
In the US, after a volatile session, the three major indexes were able to stay in positive territory at the close on Thursday as investor sentiment was boosted by the Federal Reserve signalling that its rate hike cycle is nearing its end. The Nasdaq Composite led the gains, up 1% at 11,787, with the S&P 500 up 0.3% at 3,949 and the DJIA up 0.2% at 32,105.
“The US stocks first fell then gained yesterday. The price action was, again, mostly driven by the bank stocks, both because of, and thanks to (US Treasury Secretary) Janet Yellen’s comments to US lawmakers,” commented Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
Yellen’s comments followed a statement from the Treasury Secretary on Wednesday that ‘blanket insurance’ for banking deposits after the collapse of Silicon Valley Bank (SVB) wasn’t on the table, causing renewed pressure on banks, especially on the US small regional banks, Ozkardeskaya noted.
“Then yesterday, Janet Yellen said that the US regulators are ready to take additional steps to protect deposits if needed,” she said. “Her comments helped stocks recover early-session losses. JP Morgan, Goldman Sachs, and Citi rebounded after the comment.
But trading in Asia hints that the stress over banks is not over just yet. HSBC lost more than 3% in Hong Kong, as news that UBS and Credit Suisse were among banks under the scrutiny of the US DoJ for having helped Russian oligarchs to evade sanctions.”
European banking shares have extended their falls with Deutsche Bank falling over 13%, as efforts by policymakers to reassure investors over the health of the sector failed to calm nerves in the wake of a string of failures on both sides of the Atlantic.
The fresh falls followed a spike in the cost of credit default swaps (CDS) for a number of leading European banks which sparked renewed volatility.
Deutsche Bank’s pricing for CDS, a form of insurance for a company’s bondholders against its default, leapt to 173 basis points on Thursday night from 142 basis points the previous day.
CDS prices for other leading European banks also rose.
Across Europe, banking share prices fell. In London, Barclays, NatWest, Standard Chartered and HSBC were all prominent fallers, down 6.5%, 6.0%, 5.8% and 4.5% respectively.
In Europe, the Euro Stoxx banks index fell 6.2%. Deutsche Bank fell 13.5%, Commerzbank 8.5%, Société Générale 7.7%, BNP Paribas 7.1% and UBS 8.1%.
The latest falls leave a number of the leading names in Europe nursing heavy falls for the year to date.
Image credit: Google Finance
Shares in GSK fell 3.6% after it said it “respectfully disagrees” with a ruling by a California state court in litigation related to claims that the company’s heartburn drug, Zantac, caused cancer.
The pharma giant said the scientific consensus is that there is no consistent or reliable evidence that ranitidine increases the risk of any cancer.
GSK added the litigation is still at an early stage and yesterday’s decision relates only to the question of whether the plaintiff’s experts can testify at trial in the Goetz case.
It does not mean that the Court agrees with plaintiff’s experts’ scientific conclusions or their litigation-driven science. GSK will press additional defences and the plaintiff still needs to prove his case at trial.
This ruling does not affect other state cases or the December 2022 Daubert ruling made in the federal Multi-District Litigation, the company added.
The slide in European markets shows no signs of abating. Banking shares prices have extended falls on fresh contagion fears after a spike in credit default pricing for a number of leading European banks.
In London, NatWest, Barclays and Standard Chartered top the FTSE 100 fallers down 5.4%, 5.1% and 5% respectively dragging the index down by 2.1%.
???? The #CDS spread of some European Banks has now surpassed the level seen during the UK Mini Budget Crisis!
Banking jitters on the European side of the Atlantic are flaring up again.
Markets will likely seek the next weakest link after #CreditSuisse pic.twitter.com/eR76Crsml0
In Europe, the Dax is down 1.9% and the CAC 40 down 2%.
Deutsche Bank is facing the biggest falls, now down more than 11%. Commerzbank is 8.2% lower, Unicredit has fallen 5.2%, Societe Generale has slid 6.9% and BNP Paribas 5.2%.
Over in Europe and Eurozone business activity expanded faster than expected in March, driven by growth in the services sector, indicating that an economic rebound from last year’s energy crisis is yet to be dented by recent banking turmoil.
S&P Global’s flash eurozone composite purchasing managers’ index, a measure of activity in manufacturing and services, rose to a 10-month high of 54.1 in March from 52 in the previous month.
#Eurozone flash PMI pointed to stronger #growth in the private sector economy in March, as output rose at the fastest pace since May 2022 (headline #PMI at 54.1; Feb: 52.0) and manufacturing costs fell sharply. Read more: https://t.co/ptuo0DczgZ pic.twitter.com/SSuMrylnGS
The result was higher than the 51.9 expected by economists. It was also above the 50 mark for the third month in a row, meaning a majority of businesses in the 20-country bloc reported an increase in their activity from the previous month.
Flash PMI data across Europe and the UK is being released today.
Here is the UK figures. In the UK the data for March data pointed to a sustained increase in UK private sector output, largely reflecting a strong performance by the service economy.
The headline seasonally adjusted S&P Global/CIPS Flash UK Composite Output Index posted 52.2 in March, down from February’s eight-month high of 53.1 but still above the 50.0 no-change mark.
????????Buoyed by strong #service sector performance, March saw a sustained improvement in the #UK private sector (headline #PMI at 52.2; Feb: 53.1) but manufacturing production dipped, held back by still subdued order books. Read more: https://t.co/WpgtGjx05c pic.twitter.com/m3Rl3xX0T5
The flash UK Services PMI Business Activity Index was 52.8 in March (February: 53.5), a two-month low, the flash UK Manufacturing Output Index was 49.0 (Feb: 50.9) and the flash UK Manufacturing PMI was at 48.0 (Feb: 49.3).
The latest reading signalled a moderate increase in UK private sector activity and the speed of expansion remained softer than the long run survey average.
Service sector activity picked up for the second month running in March, although the rate of growth eased since February.
In contrast, manufacturing production decreased slightly during the latest survey period as subdued demand constrained output volumes.
UK private sector firms reported a solid rise in new business volumes during March. Higher levels of new work have been recorded in each of the past two months and the latest upturn was the fastest since April 2022.
The FTSE 100 remains under pressure with renewed falls in banking stocks dragging the index lower.
The renewed falls came as Deutsche Bank came under pressure after a sharp jump in the cost of insuring against the risk of default fuelled concerns about the overall stability of Europe’s banks. Prices swung wildly in late trading in the US and the nervous mood has continued into the sesion in Europe.
Credit default swaps, a form of insurance for a company’s bondholders against its default, leapt to 173 basis points on Thursday night from 142 basis points the previous day.
???? BREAKING NEWS ????
Deutsche Bank 5 year credit default swaps are going parabolic.
Up from 415BPS to 525BPS up by 110.00BPS today alone.
A default looks to be on the cards for @DeutscheBank pic.twitter.com/nR8Q9ULdqb
In London, the FSE 100 is down 1.2%, while in Europe the Dax has slipped 1.6% and in France the Cac-40 has fallen 1.5%.
Standard Chartered, NatWest and Barclays are all prominent fallers, down 3.9%, 3.7% and 3.5% respectively.
In Europe, the Euro Stoxx 600 banks index, which contains the region’s biggest lenders, fell 1.9%. Deutsche Bank fell 7.8%, Commerzbank 4.7%, Société Générale 4% and BNP Paribas 3.2%.
Bank of England Governor Andrew Bailey urged business leaders to bare in mind inflation is expected to fall sharply this year when setting prices.
Speaking to the BBC’s Today programme Bailey said: “I would say to people who are setting prices. Please understand if we get inflation embedded interest rates will have to go up further.”
“When companies set prices I understand that they have to reflect the costs that they face.”
“But what I would say please is that when we are setting prices in the economy and people are looking forwards we do expect inflation to come down sharply this year and I would just say please bear that in mind.”
Bailey warned otherwise interest rates would rise again if prices continued to increase.
“We’ve got to get inflation down. Inflation is too high at the moment. Now we think that it will fall sharply really from the early summer throughout the rest of the year. And we’re pretty confident about that.”
Bailey spoke to the BBC the day after the BoE raised interest rates to 4.25%, their highest level for 14 years, after stronger-than-expected inflation figures on Wednesday.
He said he had not yet seen evidence of companies putting up prices more than necessary, and said that he understood they needed to “reflect the costs they face”.
Bailey said prospects for the UK economy had improved “and it is reasonable to say that there’s a pretty strong likelihood that we will avoid a recession this year.”
“But we’ve still got to put in place the conditions for much stronger growth in the economy and sustainable growth in the economy.”
The FTSE 100 headed lower at the open on Friday despite a bounce in retail sales as falls in Asia and a volatile session in the US weighed.
At 8.15am London’s lead index was down 69.90 points, or 0.93%, at 7,429.70 while the FTSE 250 fell to 18,577.60, down 152.36 points, or 0.81%.
Retail sales increased by 1.2% in February, following a rise of 0.9% in January (revised from 0.5%) although when compared with the same month a year earlier sales volumes were 3.5% lower.
The figure topped City expectations for a rise of 0.2% and was the biggest monthly rise since October.
The figures were boosted by a rise in non-food stores sales volumes which increased by 2.4% over the month because of strong sales in discount department stores.
But the mood of UK consumers remains subdued according to a survey from GfK.
The closely watched barometer of UK consumer confidence improved by two points in March to minus 36 as ongoing concerns about personal finances remained.
Gabriella Dickens, senior UK economist, at Pantheon Macroeconomics suggested despite the rise in retail sales it was “too soon to claim that a recovery has taken hold.”
She pointed out sales volumes fell in the three months to February by 0.3% compared to the previous three months and noted the GfK survey showed consumer confidence “remains very weak, despite edging up in March.”
She added GfK’s composite index still was in the bottom 3% of all past readings since 1974, and its major purchases index rose by just 4-points to -33, well below its -7 average level in the 2010s.
“All told, then, we think that retail sales likely will merely hold steady in Q2, and then will recover only gradually in the second half of this year,” she concluded.
Shares in TUI AG (LSE:TUI) fell 9.3% after unveiling a €1.8bn fundraising. Europe’s largest tour operator will use the proceeds from the share sale to cut its debt pile and reduce interest costs.
The capital raise will the firm to repay bailout money from the German state, which was a lifeline during the pandemic.
Some €1bn will be cut from Tui’s debt pile, which stood at €3.4bn as of September last year, the company said in a statement. Interest payments will also fall by between €80mln and €90mln.
Pub chain JD Wetherspoon cheered the market as it swung back into profit at the half-year stage. Shares rose 5.9% in early exchanges.
The pub chain’s gregarious chair Tim Martin highlighted the improvement came despite “ferocious” inflationary pressures.
But, he noted: “Supply or delivery issues have largely disappeared, for now.” For the 26 weeks to January 29, 2023, Wetherspoon’s said like-for-like sales were up 13.0%, compared to the six-month period ended 23 January 2022 and were up 14.9% for the first seven weeks of the second half of the financial year, compared to the same period in 2022.”
Revenue rose to £916.0mln in the period compared to £807.4mln a year ago and the firm a pre-tax profit of £4.6mln was achieved compared to a loss of £26.1mln last time.
Smiths Group (LSE:SMIN) PLC was another share on the rise. The engineering firm lifted its full-year forecasts after first-half profit climbed 27% boosted by strong demand for its products from customers in the oil, gas, airports, ports and defence sectors.
For the 12 months to July 31, Smiths said it now expected organic revenue growth of at least 8%, up from guidance given in January for growth of at least 7% after its first-half results beat expectations.
Headline operating profit came in at £241mln for the first-half, 27% higher than the same period last year, and above a consensus forecast, on organic revenue growth which stood at 13.5% in the period.
TUI AG (LSE:TUI), Europe’s largest tour operator, has launched a €1.8bn share sale to cut its debt pile and reduce interest costs, as the tourism industry continues to rebound from coronavirus restrictions.
The capital raise will enable the Anglo-German holiday company to repay bailout money from the German state, which was a lifeline during the pandemic, and lower interest payments.
Some €1bn will be cut from Tui’s debt pile, which stood at €3.4bn as of September last year, the company said in a statement. Interest payments will also fall by between €80mln and €90mln.
Tui said the outstanding €750mln from Berlin’s economic stabilisation fund would be repaid in full, while the company’s credit line would fall from €2.1bn to €1.1bn.
The company said based on current expectations in respect of trading performance, its equivalent gross leverage ratio for its financial year 2023 would fall to around 3.0x.
It also confirmed a continuation of its encouraging booking momentum reported in February 2023.
Under the fundraising 328.9mln new shares will be offered at a subscription ratio of 8:3 (8 New Shares for 3 existing shares). The subscription price is €5.55 per share.
UK consumer confidence climbed slightly in March despite the cost-of-living crisis remaining a “stark reality” for most, according to a closely watched survey.
GfK client strategy director Joe Staton said: “Forecasts that headline inflation will fall this year have proved premature, given Wednesday’s announcement of an unexpected increase.
“Wages are not keeping up with rising prices and the cost-of-living crisis remains a stark reality for most.”
“The recent Budget will bring relief to some sections of the population, but for now many people are simply looking to survive day-by-day. Just having enough money to live right and pay the bills remains the number one concern for consumers across the UK.”
GfK’s long-running Consumer Confidence Index improved two points in March, masking ongoing concerns about personal finances, rising to an overall score of minus 36.
Confidence in personal finances over the next 12 months remains weak, falling three points to minus 21, three points lower than this time last year.
However, GfK found expectations for the general economic situation over the next 12 months have increased by three points, albeit to minus 40, but nine points better than last March.
The major purchase index, an indication of confidence in buying big ticket items, also rose by four points to minus 33, nine points lower than a year ago.
JD Wetherspoon is back in profit at the half-year stage despite “ferocious” inflationary pressures as sales recovered from their pandemic lows.
The pub chain’s gregarious chair Tim Martin said: “Supply or delivery issues have largely disappeared, for now, and were probably a phenomenon of the stresses induced by the worldwide reopening after the pandemic, rather than a consequence of Brexit, as many commentators have argued.”
He highlighted inflationary pressures in energy, food and labour and said a fall in inflation would be of “great benefit.”
“Having experienced a substantial improvement in sales and profits, compared to our most recent financial year, and with a strengthened balance sheet, compared both to last year and to the pre-pandemic period, the company is cautiously optimistic about further progress in the current financial year and in the years ahead,” he added.
Martin also used the statement to highlight disparities in the treatment of pubs in relation to business rates in Scotland, the tax differential between pubs and supermarkets and even ventured in the debate about the handling of the Covid crisis.
For the 26 weeks to January 29, 2023, the pub chain said like-for-like sales were up 13.0%, compared to the six-month period ended 23 January 2022 and were +14.9% for the first seven weeks of the second half of the financial year, compared to the same period in 2022.
Revenue rose to £916.0mln in the period compared to £807.4mln a year ago and the firm a pre-tax profit of £4.6mln was achieved compared to a loss of £26.1mln last time.
Earnings per share totalled 29.4p compared to a loss per share of 19.7p in 2022 and the group passed on the dividend.
Some strong retail sales numbers to start the day.
Retail sales increased by 1.2% in February 2023, following a rise of 0.9% in January (revised from an advance of 0.5%); when compared with the same month a year earlier sales volumes fell by 3.5%.
The figure was well above City expectations for an increase of 0.2%.
Figures from the Office for National Statistics showed that sales volumes fell by 0.3% in the three months to February 2023 when compared with the previous three months.
Retail sales volumes increased by 1.2% in February 2023, following a rise of 0.9% in January 2023.
The increase over the month returns retail to its pre #COVID19 level.
➡️ https://t.co/cu9TWNiFtr pic.twitter.com/9VPDODb1J0
Non-food stores sales volumes rose by 2.4% over the month because of strong sales in discount department stores.
Food store sales volumes rose by 0.9% in February 2023 following a rise of 0.1% in January 2023, with some anecdotal evidence of reduced spending in restaurants and on takeaways because of cost-of-living pressures.
Non-store retailing (predominantly online retailers) sales volumes rose by 0.2% in February 2023, following a rise of 2.9% in January 2023.
Automotive fuel sales volumes fell by 1.1% in February 2023 following a rise of 1.1% in January 2023 when rail strikes may have increased car travel.
The FTSE 100 is expected to open lower after a volatile session in the US and ahead of UK retail sales figures in the UK.
Spread betting companies are calling London’s lead index down by 43 points.
Friday’s economic data will give an indication as to the mood of the UK consumer with retail figures and the GfK consumer confidence survey due for release. A raft of PMI releases in the UK, Europe and the US are also due.
In the US on Thursday stock prices in New York eventually ended higher after volatile trade on Thursday, as equities made hard work of their recovery from declines in the wake of the Federal Reserve interest rate decision overnight.
The Dow Jones Industrial Average closed up 75.14 points, or 0.3%, at 32,105.25. The S&P 500 rose 11.75 points, or 0.3%, at 3,948.72. The Nasdaq Composite had a more convincing trading day, surging 117.44 points, 1.0%, to 11,787.40.
In Tokyo, the Nikkei 225 index was down 0.1%. In China, the Shanghai Composite was down 0.7%, while the Hang Seng index in Hong Kong was down 0.8%.
Back in London and results from pub chain JD Wetherpoon and engineering form Smiths Group (LSE:SMIN) will also set the early tone.
Add related topics to MyProactive
ProactiveInvestors is a publisher. You understand and agree that no content in this record or published on ProactiveInvestors’ website (the “Site”) constitutes a…
Sign up to receive alerts and news direct to your inbox
Destiny Pharma PLC (AIM:DEST, OTC:DTTYF) chief executive Neil Clark speaks to Thomas Warner from Proactive after publishing research about the company's new nasal gel, called XF-73, in the US journal 'Infection Control & Hospital Epidemiology'. Clark explains more about the benefits of…
Prev article
Next article
Only registered members can use this feature.
or
© Proactive Group Holdings Inc, 2023
Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom” is registered in England with the Company Registration number 05639690. Group VAT registration number 872070825. You can contact us here.
Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use.