The FTSE 100 on Wednesday closed higher with healthcare
technology group Renishaw PLC leading the risers list and
Associated British Foods PLC the fallers. "The FTSE is
outperforming its European peers, boosted by financials as the U.K.
economy runs hot," says Sophie Griffiths, market analyst at
Best of the Best Shares Tumble on Declining Customer Engagement
Shares in Best of the Best PLC fell Wednesday after the company
warned of declining customer engagement amid easing restrictions in
Origin Enterprises Sees FY 2021 Adjusted EPS on the Rise Despite
Lower 3Q Revenue
Origin Enterprises PLC said Wednesday that it expects adjusted
diluted earnings per share for fiscal 2021, following a decent
third quarter given the inclement weather.
Severfield FY 2021 Pretax Profit Fell
Severfield PLC said Wednesday that pretax profit fell for fiscal
2021 after booking higher costs, and that its high-quality order
book for the U.K. and Europe supports continued growth throughout
fiscal 2022 and beyond.
Castings FY 2021 Profit, Revenue Fell on Covid-19
Castings PLC said Wednesday that pretax profit and revenue fell
in fiscal 2021 as the coronavirus pandemic caused disruptions, but
that it is now back to full production.
Renold Shares Fall on FY 2021 Accounts Delay; Trading in Line
Shares of Renold PLC fell as much as 12% on Wednesday after the
company said that its fiscal 2021 earnings will be delayed while
its auditors complete the audit process.
Oilex Appoints Roland Wessel as CEO
Oilex Ltd. said Wednesday that Roland Wessel has been appointed
chief executive officer effective June 16, and that Managing
Director and Interim Chairman Joe Salomon will assume the position
of executive chairman for an interim period.
Political Summits Signal International Focus on Ransomware
The attention of world leaders to ransomware in a series of
high-level meetings highlights how quickly the destructive
cyberattacks have climbed the political agenda as a string of
recent attacks disrupted companies and critical infrastructure in
the U.S. and other countries.
UK Regulator Accepts Undertakings for Asda Takeover
The U.K. Competition and Markets Authority said Wednedsay that
it has accepted undertakings from the Issa Brothers and TDR Capital
LLP for the acquisition of U.K. grocer Asda Group.
PureTech Health Buys Remaining Interest in Alivio
PureTech Health PLC said Wednesday that it has acquired the
remaining 22% stake in Alivio Therapeutics Inc., which it founded,
to leverage its strength in immunology and related technologies to
potentially treat inflammatory diseases.
Electra Private Equity Likely to Capitalize Assets Ahead of
1249 GMT - Electra Private Equity should benefit from the
structural changes made to TGI Fridays, which have led to an
encouraging start to proforma trading, Liberum says. The
U.S.-themed restaurant chain --which represents 87% of Electra's
remaining assets-- intends to add five more stores per year which
can be self-funded from cash generation, Liberum says. The
investment group is expected to use a significant proportion of its
cash balance of around GBP28 million to ensure TGI Fridays and
footwear brand Hotter Shoes are well capitalized ahead of their
upcoming listings, the broker says. The company will likely pay
down some of TGI Fridays' debt prior to the demerger taking place
later in the year, the broker says.
Higher UK Inflation Expected to Stoke Hawkish Policy Talk
1246 GMT - Rising U.K. consumer prices may fuel a more
meaningful conversation about tightening monetary policy, says Bank
of America. While investors may feel tempted to expect the Bank of
England to follow other central banks and look through inflation
news, the U.S. bank warns that the BOE has much more limited
guidance, "setting itself up to be more reactive than other central
banks," U.K. economists Robert Wood says. "Stronger inflation will
lead to more hawkish talk in our view." BofA has raised its 2021
consumer price index inflation forecast 4 basis points to 1.8% and
core inflation by 10bp to 1.6%.
Chance of BOE Raising Rates in 3Q22 Increasing
1207 GMT - The probability of an interest rate rise in the third
quarter of 2022 has been increasing despite easing market inflation
expectations, says Oliver Blackbourn, multi-asset portfolio manager
at Janus Henderson Investors. The release Wednesday of inflation
data showing a 2.1% jump in consumer prices in May has so far given
sterling a bit of a lift, but 10-year gilt yields have declined, he
says. Similarly, despite the spikes in realized inflation, global
concerns about the sustainability of price pressure seem to have
eased recently, leading to slightly lower longer-term breakeven
rates, a measure of market-based inflation expectations, he says.
"Accompanied by a general decline in real bond yields, this has led
to lower nominal sovereign bond yields in many developed
UK Lockdown Extension Likely to Counterbalance Inflation
1137 GMT - An extension of the current social restrictions in
the U.K. suggests the risks to the economy are more balanced ahead
of next week's Bank of England meeting, says Societe Generale. "GDP
looks set to rise by about 5% in 2Q, and inflation to reach 1.8%,
both a little above the Bank's latest forecasts, and unemployment
continues to fall whereas the Monetary Policy Committee had
predicted gentle increases," he says. However, a delay in lifting
the remaining lockdown restrictions by four weeks signals "the
risks are not all on one side," economist Brian Hilliard says. "The
MPC is nowhere near ready to tighten policy but we expect Andy
Haldane... to vote again for a reduction in the target asset
stock," he says.
U.K.'s Inflation Rise Might Spook Investors Despite BOE
1133 GMT - The U.K.'s sharp spike in inflation was inevitable as
the government freed the country's economy from the shackles of the
lockdown, Ben Laidler at eToro says. Rising inflation will spook
some investors who will see soaring prices as a sign that a rate
rise is coming closer, Laidler says. Still, it would appear we are
not at that point yet as the Bank of England has continuously
stated that it sees the most recent bought of inflation as
transitory or, in other words, temporary, he says. "Wages are set
to grow slower than prices and therefore this will act as a natural
cap on inflation in the coming months," Laidler says.
Temporary Spike in Inflation Shifts ECB's Focus on Negotiated
1124 GMT - The European Central Bank sees the pickup in
inflation in 2021 as completely temporary; therefore, where
inflation will peak is not the most relevant factor to watch,
Marchel Alexandrovich, senior European economist at Jefferies, says
in a webinar. "The ECB, but also the BOE, will follow how large is
the negotiated wage increase," he says. "It's less relevant where
inflation will peak," he says.
Christie Group's Continued Recovery Should Lead to
1123 GMT - Professional-services provider Christie Group's
update going into the second half has a positive tone and investors
should expect further outperformance in the share price, Shore
Capital says. "We are pleased to see that the recovery first seen
in the second half of 2020 has continued to date with the
anticipation if the current momentum is maintained of a strong
second half performance," the investment group says. Shore
forecasts Christie to return to an operating profit of GBP3.5
million in fiscal 2021 and GBP4.6 million in fiscal 2022, and says
the update adds to the view Christie can operate from a lighter,
more flexible cost base without reducing capabilities or capacity.
Shares are up 4.8% at 119.5 pence.
Rising Inflation Isn't Just a US Phenomenon as UK Inflation
1122 GMT - The U.K.'s annual inflation reading, which exceeded
the Bank of England's 2% target, shows that the specter of rising
inflation isn't just a U.S. phenomenon, Pete Drewienkiewicz at
Redington Ltd. says. The U.K. is at an earlier stage of the cycle
after pressing the pause button on economic reopening earlier in
the week, Drewienkiewicz says. "We are seeing similar dynamics play
out with a high level of job vacancies remaining unfilled which
increases the chances of wage inflation picking up over the coming
months, putting the BOE under increasing pressure to act,"
Contact: London NewsPlus, Dow Jones Newswires;
(END) Dow Jones Newswires
June 16, 2021 12:06 ET (16:06 GMT)
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