1 May 2020
RBS rounds off a rotten week for the Big Five banksOne of the very few things that RBS’ first-quarter results have going for them is that it was the last bank of the Big Five to report, so their ability to shock or surprise was much more limited. The pattern of higher bad loan provisions, falling net interest margins and plunging profits had already been set by HSBC, Barclays, Standard Chartered...
1 May 2020
FTSE extends losses and Royal Bank of Scotland is stuck in limbo“Investors are in a celebratory or a concerned mood depending on which data you look at,” says Russ Mould, Investment Director at AJ Bell.
“The US has just seen its best month for stocks since 1987 thanks to central bank support and the market becoming more hopeful about companies getting back to work and reviving the economy.
“In contrast, the UK...
30 April 2020
Six steps to recession-proof your investmentsWith all signs pointing to the fact that the UK is heading towards a recession and the Bank of England warning that it will be the worst economic shock for hundreds of years, now is a good time to revisit your investments. Markets have been on a rollercoaster ride over the past two months, so many investors are thinking about spring cleaning their...
30 April 2020
Shell shocks shareholders with a dividend cutPugnacious comments about how much cash and liquidity it had at hand in both of its March trading updates on the impact of COVID-19 on its operations had seemed to suggest that Shell, just like BP, was preparing to dig in and defend its dividend. But the combination of near-term concerns over weak oil prices and long-term worries over demand for...
30 April 2020
Shell dividend cut to hurt investors across the UK, Reckitt doing better than expected, and the FTSE continues to push forward“Driving the FTSE 100 forward 0.5% to 6,146 were the consumer cyclicals, healthcare and utilities sectors,” says Russ Mould, Investment Director at AJ Bell.
“The top FTSE 100 riser was Carnival as it led a rally in the travel and leisure sector which also included strong gains for International Consolidated Airlines and EasyJet as investors started...
29 April 2020
Product pipeline boosts AstraZeneca as drug giant seeks Covid-19 cureAstraZeneca is one of just 11 FTSE 100 firms whose shares have risen so far in 2020 and the pharmaceutical giant’s first-quarter results and full-year outlook help to explain why it is the sixth-best performer in the index so far this year. Sales rose 16% year-on-year, earnings per share handily beat forecasts on a stated and an adjusted basis and...
29 April 2020
Barclays’ investment bank does its best to prove its worthSurging loan loss provisions and plunging pre-tax profits are already losing their ability to shock investors, who are already familiar with these trends after the first quarter results from HSBC and the big US banks, so in this respect Barclays’ Q1 results feature no additional nasty surprises. Instead Barclays’ investment bank can take some...
29 April 2020
FTSE has 6,000 mark in its sights, and Next prepares for darker outlook“A positive response to results from Barclays helped lift the FTSE 100 on Wednesday, putting the index in sight of the 6,000 mark,” says Russ Mould, Investment Director at AJ Bell.
“Moving beyond this level would be a significant milestone in the recovery from the pandemic-inspired lows.
”Although Barclays has attracted flak for its commitment to...
28 April 2020
BP goes back to the future to defend its dividendBP’s $0.1050-a-share first-quarter dividend offers £1.7 billion of income to hard-pressed investors and the oil major’s cost reductions, cuts to capital investment, asset sales and higher borrowing harks back to 2015-16 when it last had to confront a major slump in prices for its products. That combination saw the company – and its dividend –...
28 April 2020
HSBC off to worst start in over 10 years thanks to credit losses and lower lending margins“Expected losses of $3 billion on its loan book, the highest figure since Q3 2011, means that HSBC’s first-quarter pre-tax profit slumped 48% to $3.2 billion, the bank’s worst start to a year in over a decade,” says Russ Mould, AJ Bell Investment Director.
“HSBC now believes the annual total for bad loan losses could come to somewhere between $7...
28 April 2020
HSBC takes multi-billion dollar provisions, and BP’s earnings suffer with worse to come“The FTSE 100 shook off renewed weakness in oil prices, which hit heavyweight oil firms, and poor results from HSBC to trade modestly higher on Tuesday,” says Russ Mould, Investment Director at AJ Bell.
“Having briefly been lower at the market open, the index recovered to place the 5,900 mark in its sights. Investors are clearly still optimistic as...
27 April 2020
£8.4 billion in quarterly dividends from FTSE 100’s five biggest payers on the line this weekEven though the insurer’s decision to cancel its proposed 20.7p-per-share special dividend will be a blow, Admiral’s retention of its £166 million final, ordinary dividend for 2019 brings some comfort to income-seekers, especially as this means Monday is the seventh trading day in a row where the value of dividends confirmed matches or exceeds that...
27 April 2020
Markets rally as lockdown restrictions start to ease, and Ashtead is coping well in the crisis“Markets kicked off the week in a good mood thanks to a plethora of information about how certain countries plan to come out of lockdown and further central bank stimulus,” says Russ Mould, Investment Director at AJ Bell.
“The FTSE 100 jumped by 1.6% to 5,842 with 97 of the 100 stocks in the index going up in value. Insurers led the charge, helped...
24 April 2020
Asian stock markets show strength in adversityGlobal stock markets are still well down for the year, despite a big rally since late March, but two trends in the regional performance figures stand out: America’s ongoing world leadership and resilience in Asia. America’s continued outperformance may be less of a shock, given the amount of money that Congress and the US Federal Reserve are...
24 April 2020
Winning large cap stocks this year, and lockdown could benefit Pearson’s digital strategy push“A 1.5% drop in the FTSE 100 to 5,741 means the blue chip index has barely moved on the week, having ended last Friday at 5,786,” says Russ Mould, investment director at AJ Bell.
“While some investors may be disappointed by the lack of a meaningful recovery, stability in the markets could be viewed as a good sign.
“The VIX ‘fear’ index has been...
23 April 2020
Why are US equities proving so resilient and can it last?“It might be St George’s Day but at the moment investors are more likely to pay homage to Uncle Sam, because America’s benchmark S&P 500 index is only down by 4% from where it was a year ago,” says Russ Mould, AJ Bell Investment Director.
Source: Refinitiv data
“That leaves all of the other major geographic options available to equity buyers well...
23 April 2020
AJ Bell Income and Growth fund update – plugging the (income) gapTo all investors seeking an income, the hit from COVID-19 has come quick and hard. Old rules of thumb have been upended. Governments and central banks have stepped in in ways even those with the battle scars of 2008/09 would have thought unthinkable. As the virus has spread, workforces have been forced into hibernation, causing dividend payments...
23 April 2020
How bad could loan losses get for the UK banks in Q1 (and beyond?)The FTSE All-Share Banks sector is down by 43% over the past year and it will be uncomfortable for holders of Barclays, HSBC, Lloyds, RBS and Standard Chartered (as well as the challenger banks) to learn that this is some way worse than the 35% fall seen across the sector globally over the same time period. Just when it seemed their profits would...
23 April 2020
Unilever still paying dividends, and housebuilders prepare to return to work“After a fairly decent showing on Wall Street last night, UK, European and Asian markets either held firm or nudged ahead on Thursday. Even the troubled oil market managed to pick itself up and recover some of the lost territory. Brent crude advanced 5.3% to $21.45 a barrel,” says Russ Mould, Investment Director at AJ Bell.
“Helping the FTSE stand...
22 April 2020
Oil price crash drags inflation down to 1.5%Even before the recent capitulation, the price of oil was on the slide in March and this dragged inflation down slightly from February’s 1.7% to 1.5%. Oil prices have a massive impact on the UK’s inflation rate and with prices at the pump and home energy costs getting cheaper we’d expect this trend to continue for the next couple of months.
What...
22 April 2020
Boohoo says demand is coming back, and Fevertree regains some fizz“Brent crude is playing catch-up with the sharp decline seen in US oil prices earlier this week. Brent has tumbled to $17.63 a barrel which is essentially half the level at which this oil benchmark traded at the start of April,” says Russ Mould, Investment Director at AJ Bell.
“Despite the commodity price continuing to fall on Wednesday, the...
21 April 2020
Clarkson drops clear hint that the oil tanker market is hitting top gearWhile the stunning collapse of the price of West Texas Intermediate oil for May delivery has got markets in a tizzy, shrewd investors will be looking to see if there is an angle for them and it may just come in the form of oil tankers.
If the black stuff cannot be stored on land then it will have to sit at sea or be slowly transported by water and...
21 April 2020
Oil in negative territory, and London Stock Exchange shows signs of resilience“Mining stocks were very much out of favour on Tuesday, dragging the FTSE 100 down 2.1% to 5,691. BHP, Evraz and Anglo American all fell by more than 5%, alongside similar weakness in oil producers Royal Dutch Shell and BP as the market worried about commodities demand,” says Russ Mould, Investment Director at AJ Bell.
“Brent Crude oil dropped 10%...
20 April 2020
WTI oil price slumps to 1999 levels, and Premier Foods feasts on triple layer of good news“The FTSE 100 nudged ahead at the start of the new trading week, sitting just above 5,800. Tobacco, telecoms and consumer goods companies were the star performers versus miners and housebuilders as the laggards,” says Russ Mould, Investment Director at AJ Bell.
“Asian stocks were mixed but most of Europe traded higher. The pound slipped 0.3%...
17 April 2020
Hopes on coronavirus treatment lift stocks, and Flutter faces a tricky balancing act“The latest surge for stocks shows just how keen the market is to react to any piece of good news amid the current crisis,” says AJ Bell Investment Director Russ Mould.
“Investors seem to be determined to remain optimistic and reports overnight that a coronavirus treatment from Gilead Sciences had delivered positive results in treating coronavirus...