UK Inflation May Have Peaked at 9%
0752 GMT - While there are plenty of upside risks to U.K.
inflation, ING says April's 9% figure will mark the peak. That
said, inflation is unlikely to fall quickly, James Smith, developed
markets economist at ING, says in a research note. The downward
pressure from certain goods categories will be offset by increases
in food prices as well as services, he says. Inflation is unlikely
to dip far below 8% for the majority of this year, Smith says.
"However, the headline rate will fall dramatically next April
assuming we don't get another leg higher in electricity prices and
indeed inflation will probably be a little below target by the end
of 2023," he says. (maria.martinez@wsj.com)
Companies News:
Burberry Reports FY 2022 Profit Rise Despite China Lockdowns Hit
in 4Q
Burberry Group PLC on Wednesday reported an improved profit for
the year ended April 2, although coronavirus restrictions in China
severely affected the business in the fourth quarter.
---
Experian FY 2022 Pretax Profit Rose; Raises Dividend
Experian PLC on Wednesday reported a rise in pretax profit in
fiscal 2022 driven by strength in organic revenue across North and
South America, the U.K. and Ireland, and raised its dividend
payout.
---
British Land Swung to FY 2022 Pretax Profit on Covid-19
Recovery
British Land Co. said Wednesday that it swung to a pretax profit
in fiscal 2022 as coronavirus pandemic-related hits to its property
value were reversed.
---
Anglo American's De Beers Diamond Sales Rose in Fourth Cycle
Anglo American PLC on Wednesday reported an increase in diamond
sales from its De Beers subsidiary for the fourth sales cycle of
2022.
---
Aviva 1Q General Insurance Sales Rose; Backs Dividend
Guidance
Aviva PLC said Wednesday that sales in general insurance rose in
the first quarter and reiterated its dividend views for 2022 and
2023.
---
Premier Foods FY 2022 Pretax Profit, Revenue Fell
Premier Foods PLC said Wednesday that pretax profit fell in
fiscal 2022 as revenue decreased, and that it expects further input
cost inflation.
---
Marston's Swung to 1H Pretax Profit, Revenue Rose on Covid-19
Recovery
Marston's PLC said Wednesday that it swung to a pretax profit
for the first half of fiscal 2022 and posted a significant revenue
increase as it recovered from the coronavirus pandemic.
---
Vistry Raises 2022 Profit Expectations on Strong Demand Across
Business
Vistry Group PLC said Wednesday that early 2022 has seen strong
demand across all areas of its business, and that it expects to
deliver full-year profit at the top end of market forecasts.
---
Burberry FY 2022 Profit Rose Despite 4Q Hit From China Lockdowns
-- Update
Burberry Group PLC on Wednesday reported an improved profit for
the year ended April 2, although coronavirus restrictions in China
severely affected the business in the fourth quarter.
---
Watches of Switzerland FY 2022 Revenue Rose on Strong Demand for
Luxury Watches and Jewelry
Watches of Switzerland Group PLC said on Wednesday that revenue
for fiscal 2022 jumped, driven by strong demand for luxury watches
and jewelry in the U.S. and U.K.
---
Keller Group Has Had Mixed Start to Year; Backs 2022
Guidance
Keller Group PLC said Wednesday that it has had a mixed start to
the year and backed its full-year guidance.
Market Talk:
British Land's Strong FY 2022 Results Leave Scope for
Upgrades
0738 GMT - British Land's results show FY 2022 was strong for
the company as its repositioned portfolio benefited from improving
retail values and healthy investor appetite for prime assets,
Goodbody says. The real estate investor's growth, similar to sector
peers, was driven by a better 2H, up 4.0% compared with 2.9% in 1H.
Although interestingly, London office growth slowed in 2H while
retail improved, Goodbody analyst Colm Lauder says in a research
note. "We see room for net asset value upgrades of around 4% for
fiscal 2023 and fiscal 2024," the Irish brokerage says. Goodbody
retains its hold rating on the stock. Shares are up 0.4% at 508.6
pence.
UK Inflation Jumped in April, Expected to Ease Slightly Over the
Coming Months
0737 GMT - U.K. inflation reached its highest level since
November 1981 in April, rising to 9.0%, but was lower than the Bank
of England's Monetary Policy Committee forecast of 9.1%, Samuel
Tombs, chief U.K. economist at Pantheon Macroeconomics, says in a
research note. Looking ahead, the headline rate of inflation is
likely to edge down over the coming months, probably to around 8.5%
by August, Tombs says. Pantheon's forecast takes into account
further rises in food and core goods prices signaled by producer
prices, but assumes that price rises in the services sector will
ease. (maria.martinez@wsj.com)
UK Inflation Set to Hit Poorest Households Hardest
0721 GMT - The cost-of-living crisis in the U.K. is inflicting
more financial pain on poorer households as they spend a larger
proportion of their budgets on utility bills, an area in which
inflation is rising sharply, Institute for Fiscal Studies research
economist Heidi Karjalainen says in a note. U.K. inflation stood at
9% in April, but IFS analysis shows that the poorest 10% of
households faced a rate of 10.9%, while the richest saw prices
increase by 7.9%. "Continuing pressures... are likely to push the
October tariff cap, as well as other prices including food prices,
even higher later this year," Karjalainen says. "We are likely to
be in a prolonged period during which poorer households are facing
rates of inflation even higher than the headline figures would
suggest." (xavier.fontdegloria@wsj.com)
Burberry FY 2022 Results Were in Line With Expectations
0719 GMT - Burberry's results for the year ended April 2 were in
line with expectations, and the acceleration of the Americas and
EMEIA (Europe, the Middle East, India, and Africa) regions in 4Q is
encouraging, Piral Dadhania from RBC says in a note. The luxury
brand is guiding for significant currency tailwinds at the
operating profit level for fiscal 2023, the analyst says. "We
retain our sector perform rating, as we await further clarity on
the strategic direction of Burberry, and evidence it can close the
growth gap with luxury peers," Dadhania says. Shares rise 1.7% to
1,610 pence. (jaime.llinares@wsj.com)
UK 10Y Gilt Yields Steady Despite UK Inflation Jump
0715 GMT - U.K. borrowing costs over the next 10 years remain
largely unchanged after official data showed U.K. consumer prices
jumped to a 40-year high in March. The 10-year gilt yield trades
last at 1.881%, according to Tradeweb. The consumer price index
measure of inflation rose to 9% in the 12 months to March, driven
by rising petrol and food prices, according to the Office for
National Statistics. This is up from 7% the previous month though
it was marginally below the consensus in a WSJ poll for 9.1%.
Higher inflation and a strong labor market put the Bank of England
in a difficult position, as raising rates too quickly at a time
when consumers are already struggling could crimp demand and push
the economy into recession, says JP Morgan Asset Management's
Ambrose Crofton in a note. (lorena.ruibal@wsj.com)
British Land Offers Robust Outlook
0712 GMT - British Land's fiscal 2022 exceeded both market
consensus and RBC Capital Markets' expectations, with positive
comments from management about its outlook. The real-estate company
highlights the potential for further yield declines, particularly
in retail, and expectations for rent growth across its portfolio,
while the company's strategic advantage in sectors with pricing
power means it can look ahead with confidence, despite elevated
macro uncertainties, RBC analysts say in a research note. "We
believe British Land's share price multiples fully reflect the
various strengths of its business given the current risk/reward of
its key markets and its plans to increase its exposure to urban
logistics in a competitive market," the bank says, retaining its
sector perform rating and 475 pence price target.
(joseph.hoppe@wsj.com)
Contact: London NewsPlus; paul.larkins@wsj.com
(END) Dow Jones Newswires
May 18, 2022 04:17 ET (08:17 GMT)
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