Pound Oversold Due to External Factors, Repricing of UK Rate
Bets
Sterling has fallen deep into oversold territory due to external
factors and the market scaling back its expectations for U.K.
interest rate rises, ING says. Sterling net short positions, which
expect the currency to weaken, reached their highest level since
October 2019 in the week to Nov. 30, according to the Commodity
Futures Trading Commission. The rise in shorts was "first and
foremost" due to a stronger dollar but also reflects risk aversion
and some repricing of U.K. rate rise expectations after the Bank of
England held rates in November and the Omicron coronavirus variant
emerged, ING forex strategist Francesco Pesole says. Another
potential factor is post-Brexit trade tension, although this has
been a smaller driver, he says.
Companies News:
Fusion Antibodies 1H Pretax Loss Widened, Revenue Rose
Fusion Antibodies PLC said Monday that its pretax loss widened
for the first half of fiscal 2022 despite increased revenue, and it
expects its full-year revenue to meet expectations.
---
Cellular Goods Appoints New CEO
Cellular Goods PLC said Monday that it has appointed Anna
Chokina as its new chief executive officer.
---
Thungela Sees 2021 Export Coal Production in Line With
Guidance
Thungela Resources Ltd. said Monday that it expects export
saleable production of 14.9 million metric tons of coal in 2021, in
line with the latest guidance.
---
Hardide FY 2021 Pretax Loss Widened; Sees Improved Performance
in FY 2022
Hardide PLC on Monday reported a widened pretax loss for fiscal
2021 on lower revenue, but said it expects its performance to
improve next fiscal year as demand recovers.
---
Hammerson to Buyback Around GBP2.5 Mln of Shares
Hammerson PLC said Monday that it will start a share repurchase
program, rebuying shares worth up to around an implied 2.5 million
pounds ($3.3 million).
---
Apax Global Alpha Funds to Sell Stakes in Unilabs
Apax Global Alpha Ltd. said Monday that two funds that it
advises have agreed to sell their stakes in Unilabs to AP Moller
Holding, with the transaction expected to close in the first
quarter of 2022.
---
3i Infrastructure Invests GBP191 Mln in SRL Traffic Systems for
Majority Stake
3i Infrastructure PLC said Monday that it has invested 191
million pounds ($252.8 million) for a 92% stake in SRL Traffic
Systems, a traffic-management rental company in the U.K.
---
AG Barr Acquires 60% of MOMA Foods, Plans Full Control Within
Three Years
AG Barr PLC said Monday that it has taken a 60% equity stake in
MOMA Foods Ltd. and plans to take full ownership of the company
over the next three years.
---
Windward Shares Rise on London Debut
Shares in Windward Ltd. rose Monday as the company began trading
on the AIM.
---
Brandshield Reaches $5.0 Mln in Annual Recurring Revenue
BrandShield Systems PLC said Monday that it has suprassed $5.0
million in annual recurring revenue, its primary performance
indicator.
---
Spectra Systems' New Customer K-Cup Optical Material Orders
Exceed Expectations
Spectra Systems Corp. said Monday that a new customer has placed
three orders totaling $394,000 for K-cup optical materials since
September.
---
Norman Broadbent Raises GBP75,347 From Large Shareholder
Norman Broadbent PLC said Monday that it has raised 75,347
pounds ($99,729) after issuing shares to shareholder Downing
LLP.
---
D4t4 Solutions Launches Share Buyback Program of Up to 200,000
Ordinary Shares
D4t4 Solutions PLC said Monday that it was launching a share
buyback program of up to 200,000 ordinary shares, and that it will
hold in treasury all ordinary shares purchased so as to satisfy
future obligations.
Market Talk:
Victrex Recovery May Take Time, Dragging on Shares
1210 GMT - Victrex may take time to make progress despite an
upbeat second half, Citigroup says. The plastics group's 2H results
topped expectations, helped by modestly improving higher-margin
medical sales, the investment bank says. "Looking forward to 2022,
management expects growth in volumes, offset by raw materials and
energy cost impacts as well as foreign-exchange headwinds," Citi
analysts say. "VCT is exiting the trough but the process should
take time, constraining the upside for the shares, in our
opinion."
---
Deliveroo Shares Drop Ahead of Expected EU Proposal on
Gig-Economy Workers Rights
1205 GMT - Deliveroo faces a potentially significant gross
profit hit from the European Commission's looming proposal
concerning employment rights for gig-economy workers, Citi says.
The proposal--expected Wednesday--could come into effect during the
next two years, with individual countries left to interpret it for
themselves as the EU's executive arm can't mandate labor laws, Citi
notes. The U.S. bank estimates Deliveroo's gross profit will be
reduced by 12% to 18% if European gig economy workers are to be
treated as employees rather than contractors. Shares in Deliveroo
fall 8.6% to 220.6 pence. Shares in Just Eat Takeaway also fall
5.5% to EUR48.26. Delivery Hero trades down 5.2% at EUR97.10.
---
3i Infrastructure Made a Good Choice With SRL Traffic
Investment
1149 GMT - 3i Infrastructure's GBP191 million investment for a
92% stake in SRL Traffic Systems shows its ability to enter and
exit assets at the right time, leading to meaningful value creation
above fund targets, RBC Capital Markets says. The
infrastructure-investment company has chosen a strong fit for its
portfolio, with SRL well positioned to benefit from increased
infrastructure spending in the U.K., the Canadian bank says. "We
expect that the flexibility provided by SRL will be a strong
feature for additional customer demand as owning increasingly
complex traffic management systems is unlikely to be cost
effective," RBC says, retaining its outperform rating on 3i
Infrastructure stock and 360-pence price target. Shares are flat at
343 pence.
---
London Stock Exchange Acquisition of Quantile Should Boost Its
Earnings
1143 GMT - London Stock Exchange Group's GBP274 million bolt-on
acquisition of Quantile for its post trade division is likely to be
earnings enhancing, although there isn't any guidance on the
asset's profitability at this stage, RBC Capital Markets says. The
stock-exchange and financial-information company's strong cash
generation and ability to supplement growth through acquisitions
enhances the deal's medium-term appeal, though acquisitions in the
data and analytics arena were expected to be more of a priority,
RBC says. "We see the enlarged group as transformed, with higher
quality revenue streams and enhanced exposure to secular growth
themes," the Canadian bank says. RBC retains an outperform rating
on the stock, with a price target of 10,300 pence. Shares are up
0.9% at 6,584 pence.
---
Persimmon Homes Faces Demand Risks From Higher Interest
Rates
1129 GMT - Persimmon might face pressure as potentially higher
U.K. interest rates weigh on demand from first-time home buyers,
Barclays says. The bank cuts its rating on the house builder's
stock to underweight from overweight, though it raises Crest
Nicholson to overweight from equalweight, and Berkeley Group to
equalweight from underweight after share-price weakness. "Following
recent house-price inflation, we expect affordability to come under
further pressure in 2022 as interest rates and the cost of living
rise," Barclays's analysts say. "We see particular demand risks for
first-time buyers, where rising rates have a more pronounced impact
on mortgage costs. Our analysis shows Persimmon is most
exposed."
---
Shell's Dividend Offers Protection From Inflation
1030 GMT - Shell's forecast dividend yield of 4.4% for 2022 will
help to protect investors' cash from the ravages of inflation, and
the energy major might top it up with further cash returns via
share buybacks, AJ Bell's Russ Mould says. The share price could be
volatile as oil and gas prices jump around, but they seem
relatively well-underpinned unless a new coronavirus variant leads
to a new collapse in economic activity, he says. "This one will not
win any friends among those investors who run strict ethical,
social and governance screen tests, but oil major Shell may appeal
to those income-seekers for whom profit is every bit as important
as principle," Mould says.
Contact: London NewsPlus, Dow Jones Newswires; Write to Sarka
Halas at sarka.halas@wsj.com
(END) Dow Jones Newswires
December 06, 2021 08:10 ET (13:10 GMT)
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