Pound to Fall Vs Dollar if BOE Delays Rate Rise, Fed Accelerates
Tapering
Sterling is likely to weaken versus the dollar if the Bank of
England delays raising interest rates and the Federal Reserve
accelerates the tapering of asset purchases, MUFG Bank says. The
BOE will likely keep rates unchanged until at least February after
the U.K. government tightened coronavirus restrictions and
following recently cautious comments from BOE officials, MUFG's Lee
Hardman says. Meanwhile, the Fed should speed up tapering at its
December 14-15 meeting, he says. "The time gap between the first
BOE and Fed rate hikes is likely to be much shorter now than
initially expected which should keep downward pressure on cable
heading into year end and moving it closer to the 1.3000-level."
GBP/USD trades flat at 1.3206.
Companies News:
Rolls-Royce Returned to Positive Free Cash Flow in 3Q
Rolls-Royce Holdings PLC said Thursday that it restored positive
free cash flow in the third quarter.
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Farfetch Snaps Up Resale Platform as Secondhand Luxury Keeps On
Growing
Farfetch Ltd. has acquired luxury resale platform Luxclusif as
the sector's interest in the second-hand market grows apace,
marking the latest expansion at the British-Portuguese e-commerce
firm.
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Frasers 1H Pretax Profit Rose Significantly; Sees FY Growth
Frasers Group PLC on Thursday reported a significant rise in
pretax profit for the first half of fiscal 2022 and said that it
expects to post a materially stronger adjusted pretax profit for
the full year if there are no additional Covid-19 lockdowns in the
U.K., particularly during Christmas.
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DS Smith 1H Pretax Profit, Revenue Rose; Increases Dividend
DS Smith PLC said Thursday that pretax profit and revenue rose
for the first half of fiscal 2022 and that it has increased the
interim dividend.
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ITV Studios Revenue Seen Recovering to 2019 Levels in 2022
ITV PLC said Thursday that total revenue for its ITV Studios
unit should recover to 2019 levels in 2022.
---
Harbour Energy Introduces $200 Mln Annual Dividend
Harbour Energy PLC said Thursday that it will introduce a $200
million annual dividend, as it expects to remain free cash flow
positive every year in the medium term at current forward commodity
prices.
---
Hikma Signs Deal to Commercialize Gedeon Richter's Osteoporosis
Treatment
Hikma Pharmaceuticals PLC said Thursday that it has signed a
deal to commercialize Gedeon Richter PLC's denosumab in the
U.S.
---
Stanley Gibbons 1H Pretax Loss Widened; Aims to Become Cash
Sustainable in 2H
Stanley Gibbons Group PLC said Thursday that its pretax loss
widened in the first half of fiscal 2022 and that it aims to become
a sustainably cash positive business within the next six
months.
---
Galileo Resources Shares Rise as Investee Glenover Agrees to $16
Mln Disposal
Shares in Galileo Resources PLC rose Thursday after it said its
investee Glenover Phosphate Proprietary Ltd. agreed to sell certain
phosphate rock deposits and mining rights for 250 million rand
($15.9 million) to Afrimat Ltd.
---
S&U Growth Accelerates on Strong Performance
S&U PLC said Thursday that it is performing strongly, with
growth accelerating in both its Advantage Finance and Aspen
Bridging Finance businesses.
---
Clipper Logistics 1H Pretax Profit Rose
Clipper Logistics PLC on Thursday reported a higher pretax
profit for the first half of fiscal 2022, and said it is on track
to meet full-year expectations.
---
Real Good Food Shares Rise as 1H Pretax Loss Narrowed
Significantly
Shares in Real Good Food PLC rose Thursday after the company
reported a significantly narrowed pretax loss for the first half of
fiscal 2022 and said the board is confident it will restore greater
profitability over the coming trading periods.
Market Talk:
Platform Companies Could Leave Some Countries After EU
Gig-Worker Bill
1117 GMT - Ride-hailing and delivery companies could decide to
leave certain countries given the higher costs implied by employing
riders, Bryan Garnier warns. The EU on Thursday published a legal
proposal that could entail the reclassification of more than 4
million gig workers in the bloc, with an associated increase in
costs of up to EUR4.5 billion a year for platform companies. In
Spain, a law came into force this summer ordering delivery
platforms to employ their workers, leading U.K.-based Deliveroo to
withdraw from the country entirely. Given the higher scale need to
break even if and when the new proposals are implemented, some
players could decide similarly to exit certain markets, Bryan
Garnier says in a note published ahead of the bill, adding that
consumer costs could also rise.
---
Platform Companies Should See EU Gig-Worker Proposals in
Perspective
1111 GMT - Re-classification of platform workers as employees
should be seen in perspective, Bryan Garnier says. The EU on
Thursday published a legal proposal that could entail the
re-classification of more than 4 million gig workers in the bloc,
with an associated increase in costs of up to EUR4.5 billion a year
for platform companies. While the law does mean material changes to
the way such companies operate, it has been expected for a long
time, and could take years to implement by each member country,
Bryan Garnier says in a note ahead of the bill's publication.
Recent selloff in delivery stocks including Delivery Hero,
Deliveroo and Just Eat is, as such, excessive, the investment bank
says.
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Balfour Beatty's Stable London Outlook Is Reassuring
1058 GMT - Balfour Beatty expects its fiscal 2021 earnings to be
in line, with a return to pre-coronavirus pandemic profits and,
most positively, no change to London Residential assumptions, Peel
Hunt says. The infrastructure group's shares have weakened since
August, when it said losses on London property construction
contracts meant its U.K. construction business hadn't made any
progress on the year, the brokerage says. Now Balfour's investors
should be reassured there is no further changes to assumptions,
with one project now completed and two remaining, Peel Hunt says.
"The continuation of the multi-year capital returns program should
also refocus minds on Balfour Beatty's potential," Peel Hunt says,
reiterating its buy rating and 350 pence target price. Shares are
up 2.7% at 253.8 pence.
---
Financial Materiality Helps the 'S' in ESG in Shine
1039 GMT - Having a more consistent language in the
sustainability space will go a long way to making social issues
more tangible in ESG investing, where the 'S' is widely seen as the
hardest area to measure. "The market needs a common language, so
that people don't think, 'Well social means we're just talking
about being nice,'" says Nneka Chike-Obi, director at Sustainable
Fitch. Though there are frameworks like SASB for financial
materiality-oriented reporting, there still isn't standardization
around social metrics. Corporate sustainability reports can read
like essays or journal entries: "'We love the world. We love our
workers,' but where are the numbers?," she says. What people need
to know are metrics like percentage of female staff or number of
safety incidents. Failing to address financial risks stemming from
social issues could affect how an organization like Fitch rates a
company, she says.
---
Rolls-Royce Shares Fall on Slower Recovery Concerns
0848 GMT - Rolls-Royce shares fall 3.2% after releasing a
trading update. While things are moving in the right direction, the
engine-maker is still set to fall short of its 2021 target for
large engine flying hours, Michael Hewson at CMC Markets says. This
isn't surprising given what has been happening with the Delta
coronavirus variant in Europe and latterly Omicron, and
international travel is likely to remain a headwind heading into
next year, he says. Rolls-Royce returned to positive free cash flow
in 3Q, but the company still has some way to go to reach its 2022
free cash flow target of GBP750 million, and much of this will
depend on when and if international travel returns to normal,
Hewson says.
---
Frasers 1H Came in Ahead of Views, But It Still Faces
Headwinds
0833 GMT - Frasers's set of results for the first half of fiscal
2022 were better than expected, RBC Capital Markets says. The U.K.
sports-fashion retailer's performance shows it is in a good
position given the momentum in the core sports retail businesses
and stronger-than-expected full-price sales, the Canadian bank
adds. However, execution risk is higher than average for Frasers
and it may be challenging to scale its luxury offer outside of
regional U.K. cities, it says. At the same time, department stores
continue to face structural pressures and a gradual loss of their
range advantage to online players, RBC adds. "Finally Frasers
continues to lag the sector on ESG practices, which is likely to
constrain its appeal to investors," it notes.
Contact: London NewsPlus, Dow Jones Newswires; Write to Sarka
Halas at sarka.halas@wsj.com
(END) Dow Jones Newswires
December 09, 2021 06:38 ET (11:38 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.