13 October 2022
US Q3 reporting preview: can earnings season revive the S&P 500?“Earnings from PepsiCo on Wednesday, Walgreen Boots Alliance and Delta Airlines on Thursday, and then a slew of megabanks on Friday, kick-off the third-quarter results season in the USA and wobbling stock markets will be looking for reassurance that corporate profits are holding up,” says AJ Bell Investment Director Russ Mould.
“After recent stink...
13 October 2022
Drop in reservations rocks Barratt’s share price alongside grim economic backdropIf government ministers needed any evidence of how policy missteps can affect not just the financial markets but the real economy, then Barratt Developments’ first quarter results statement provided it in spades.
The average weekly rate of private reservations for new houses at its active sales outlets has fallen to 0.55 in the first three months...
13 October 2022
FTSE slumps ahead of US inflation data, EasyJet to post third consecutive annual loss, mixed fortunes for gambling firms Rank and Entain“The FTSE 100 was lower ahead of a crunch end to the five-day trading session which features the end of the Bank of England’s gilt-buying programme tomorrow and, later today, US inflation figures,” says AJ Bell Investment Director, Russ Mould.
“It feels like the markets are feeding hungrily on any scraps of good news and even the merest hint...
12 October 2022
Markets calm despite latest twist in pensions saga and Barratt warning triggers sell-off in housebuilder shares“Despite some harsh words from Bank of England governor Andrew Bailey towards the pensions industry last night, causing the pound to slump again, equity markets have not descended into chaos” says Russ Mould, Investment Director at AJ Bell.
“The FTSE 100 held firm at 6,884 as approximately three quarters of its constituents earn in foreign...
11 October 2022
Bank of England’s actions further stoke investor concerns, Greencore disappoints and ScS avoids disaster“The fact the Bank of England has widened its support measures for the market by including index-linked gilts in its programme of government bond purchases will only serve to worry investors even more,” says Russ Mould, Investment Director at AJ Bell.
“So far, its support measures haven’t kept a lid on gilt yields as they have continued to creep...
10 October 2022
Multitude of factors troubling markets, DS Smith lifts guidance and Hollywood Bowl strikes with earnings upgrade“A troubled backdrop has put markets in the red at the start of the new trading week. Renewed attacks on Kyiv following an explosion on the Crimea bridge at the weekend has proved a sad reminder that the war is far from over,” says Russ Mould, Investment Director at AJ Bell.
“Also leaving investors on edge is the news that the Bank of England has...
7 October 2022
Markets eye US jobs numbers, Wetherspoons unhappy and Marshalls hit by slump in household paving stone demand“The key event of the day for markets is the release of new US jobs numbers as these will be analysed closely by the Federal Reserve at its November interest rate decision. The consensus is non-farm payrolls to have increased by 250,000 in September versus 315,000 in August. The unemployment rate is seen unchanged at 3.7%,” says Russ Mould...
6 October 2022
FTSE up modestly, oil up on OPEC cut but Shell hit by weak performance, Imperial Brands is swimming in cash, strong sales for Diageo and Motorpoint stalls“It doesn’t feel like Tuesday’s market rally was built to last as the dollar is back on the march. While the FTSE 100 is modestly higher this morning, there is no great momentum behind it,” says AJ Bell Investment Director, Russ Mould.
“The gilt market is once again under pressure as a second ratings agency effectively puts the UK on watch for a...
5 October 2022
FTSE dips, OPEC readies production cut, Twitter deal back on, Tesco trims profit guidance“After yesterday’s big rally there was a more sober start for the FTSE 100 this morning as the EU moved closer to a deal to cap the price of Russian oil,” says AJ Bell Investment Director, Russ Mould.
“Oil prices held on to previous gains as OPEC prepares to unveil an expected production cut. There will be a lot of attention on just how big this...
4 October 2022
Markets rebound, Drax slumps, Royal Mail changes name and Greggs looks resilient“Stocks are up, the Vix volatility index is easing back, and US and UK government bond yields are falling. It’s as if everyone has forgotten about the gloomy outlook and instead regained an appetite for risk,” says Danni Hewson, Financial Analyst at AJ Bell.
“How long this party lasts is another matter as we’re about to enter the next earnings...
3 October 2022
Market reaction to 45% tax U-turn, Telecom Plus pleases again and Tortilla shares burnt by bad news“The pound enjoyed a welcome bounce after Kwasi Kwarteng manoeuvred his first U-turn as Chancellor by scrapping the proposed cut to the 45% tax rate, with sterling jumping from $1.1088 to $1.12646 in less than two hours,” says Russ Mould, Investment Director at AJ Bell.
“The U-turn is important for two reasons. First, the market was panicking...
30 September 2022
Pound returns to pre-mini-Budget levels, second quarter GDP revised upwards, Cineworld sees admissions falling, Dignity swings to a loss“The pound may have returned to the levels it was at when Chancellor Kwasi Kwarteng stood to address MPs a week ago but that doesn’t mean we’ve miraculously returned to a pre-mini-Budget world,” says AJ Bell Investment Director, Russ Mould.
“The currency’s recovery is predicated on more rapid and aggressive rate hiking from the Bank of England...
29 September 2022
Another boo-boo from Boohoo as retailer warns on profits againIncreased costs, higher product returns and ongoing investment in warehousing and distribution meant that Boohoo issued profit warnings in December and May and lower-than-expected sales have now added to the tale of woe and forced the online retailer to issue another trading alert, this time alongside its first-half results.
Analysts had already...
29 September 2022
Gilts move back up, pension and property stocks fall, Next joins list of companies warning on profits“The great gilt calamity of 2022 continues to inflict pain on investors as pension companies took a tumble on the UK market, dragging the FTSE 100 down with them,” says Russ Mould, investment director at AJ Bell.
“ Legal & General and Phoenix Group slid as investors worried about their investment exposure to gilts, following yesterday’s panic over...
28 September 2022
FTSE hits 17-month low, Burberry brings in new creative chief and Boohoo warns again“With the prospect of a sharp economic slowdown, further pain for households and businesses, and investor sentiment on its knees, alas equities markets continue their descent,” says Russ Mould, Investment Director at AJ Bell.
“The FTSE 100 dropped 2.1% to 6,836 as shares in both defensive and growth stocks were out of fashion. That’s the UK index...
27 September 2022
What happened last time sterling was slammed down to $1.05?“The pound is trading down around 1985’s all-time bottom against the dollar of $1.05 and multi-year lows in not just sterling but the yen and euro against the greenback also hark back to the mid-eighties when only multi-lateral Government intervention stopped the dollar in its tracks, with the so-called Plaza Accord,” says AJ Bell investment...
27 September 2022
Pound steadies, FTSE 100 ticks up, Virgin Money in demand despite mortgage deal suspension and Saga misses again“It felt like the calm after the storm on Tuesday morning as sterling stabilised and the FTSE 100 made modest progress,” says AJ Bell Investment Director Russ Mould.
“However, the risk of another squall looks high as new Chancellor Kwasi Kwarteng prepares for what could be an interesting meeting today with big bankers. Mortgage lenders pulling...
26 September 2022
Sterling hits record low against the dollar and Unilever boss Jope to retire“The market’s continuing verdict on the mini-Budget which turned out to be anything but mini couldn’t really have been any more savage as sterling hit an all-time low against the dollar,” says AJ Bell Investment Director Russ Mould.
“The sceptre of parity against the dollar, which felt far off just a week ago, now feels dangerously close.
“Amid...
23 September 2022
Consumer confidence slumps, Made.com up for sale and The Works still doing well“It’s been a major week for the markets with increases in UK and US interest rates and now a mini-budget from the new UK Government,” says Russ Mould, Investment Director at AJ Bell.
“One on hand you have the central banks acting as the evil bad guys pushing up the cost of borrowing, and on the other you have the UK Government as the superhero...
22 September 2022
FCA takes aim at Link with £50m fineNews that the FCA has issued Link Fund Solutions a draft Warning Notice in relation to its activities with the Woodford Equity Income fund hopefully indicates that the investigation is now moving towards its final phases. The draft notice informs Link that a penalty of £50m is proposed for its failings in the oversight and operation of the fund and...
22 September 2022
Fed puts markets in a tizz with latest hike, PZ Cussons demonstrates pricing power and JD Sports faces tougher times ahead“While the 75-basis point rise in US rates was largely expected, particularly after US inflation proved stickier than hoped in August, the messaging around the decision helped put markets in a tizz overnight,” says AJ Bell Investment Director, Russ Mould.
“Wall Street ended a see-saw session firmly in the red as Federal Reserve chair Jerome Powell...
21 September 2022
How far will (or can) the US Federal Reserve take interest rates?“The CME Fedwatch tool is putting an 84% chance on a three-quarter percentage point increase and a 16% chance on a full one-point hike from the US Federal Reserve at its latest meeting, but financial markets are already wrestling with just how far the American central bank is prepared to go in its new-found zeal to fight inflation,” says AJ Bell...
21 September 2022
Markets braced for US rate rise, housebuilders up on stamp duty cut reports, and JD counts the cost of Cowgill exit“There is really no question of whether the Federal Reserve will raise rates or not today. They’re almost certainly going up. The key unknown is exactly how much the central bank will push up the cost of borrowing. The consensus is for a 0.75 percentage point rise, which would be the third hike of such magnitude in a row. That would push rates to...
20 September 2022
FTSE higher ahead of crunch central bank meetings, Ashley to leave Frasers, Kingfisher profits slump“The FTSE 100 made a strong start to trading after the Bank Holiday, taking its cue from strong trading in Asia and the US,” says AJ Bell Investment Director Russ Mould.
“All the focus this week will be on interest rate decisions in the US and UK and a so-called ‘mini budget’ from new chancellor Kwasi Kwarteng on Friday.
“Despite the pressures on...
16 September 2022
'Soggy' chip demand weighs on Renishaw despite profit and dividend boostIts wide spread of business, in terms of its customer industries and geographic markets, mean that precision instrument maker Renishaw is a pretty fair proxy for the global economy. Economists and stock market investors alike may therefore be concerned to hear the Gloucestershire firm flag how its new financial year is seeing weakness in orders in...
16 September 2022
Fears over rate rises and economic downturn hit markets, made worse by FedEx’s big profit warning“Markets flashed red across the board on the last day of the trading week. Investors have become increasingly nervous about the scale and pace of interest rate hikes after the recent bout of inflation data and next week we have some serious decisions to be made by some of the most important central banks,” says Russ Mould, investment director at AJ...
15 September 2022
FTSE up, warnings from THG, DFS and Hilton Foods, Shell CEO to leave“After all the drama around high inflation rates in recent sessions, pockets of Asian and European markets managed to push ahead on Thursday. The Hang Sang jumped 0.5%, the Nikkei nudged up 0.2% and the DAX advanced 0.1%,” says Russ Mould, investment director at AJ Bell.
“In the UK, the FTSE 100 traded 0.6% higher, with banking stocks leading the...
14 September 2022
Retail operation delivers another banana skin to Ocado and M&S investors“The core business of Ocado Retail is delivering jam to its customers today but after another trading disappointment shareholders in the business are once more left with a story that promises jam tomorrow,” says AJ Bell investment director Russ Mould.
“The Ocado Smart Platforms business still offers undeniable long-term potential, as the company...
14 September 2022
Dunelm reveals record profit despite tough outlook and Fundsmith to shut EM trust“Despite some of the key factors behind surging inflation easing slightly, many prices continue to go up and markets are not happy. Yesterday’s slump on Wall Street was triggered by a mixture of investor jitters and the fact that food, house and medical costs continue to rise,” says Russ Mould, investment director at AJ Bell.
“The Vix measure of...
13 September 2022
US inflation in focus, latest supermarket data sees Morrisons lose ground and Ocado sales drop“The FTSE 100 failed to back up Monday’s strong gains and saw modest losses on Tuesday as unemployment dropped to its lowest level since 1974, but wages still failed to keep pace with rampant inflation,” says AJ Bell investment director Russ Mould.
“Rising prices will be in focus this lunchtime as the US posts its CPI reading for August. July’s...
12 September 2022
Soames to leave Serco and IPO revival spurred by two new trusts“Disappointing UK GDP figures failed to derail the country’s main stock indices, with the domestically focused FTSE 250 up 0.3% and the more international FTSE 100 rising by 0.6%,” says Russ Mould, investment director at AJ Bell.
“The mere 0.2% advance in the UK economy in July would suggest consumers have been tightening their belts as they...
8 September 2022
ECB takes centre stage, Primark warns on energy costs, Melrose automotive unit spin off, Darktrace suitor exits and Restaurant Group takeaways warning“For years, central bank interest rate decisions used to be background noise, with investors confident that rates would stay low. This year they’ve become must-watch events, with every word studied by the market,” says Russ Mould, Investment Director at AJ Bell.
“The current theme is not whether central banks will raise rates, but by how much...
7 September 2022
Why the strong dollar could be a source of concern for investorsWhile UK-based investors will be well aware of how weak the pound is against the US dollar, languishing near $1.15 and its lows of early 1985, sterling is not the only currency whose decline against the greenback is gathering pace.
The DXY index, which measures the value of the dollar against six major currencies, stands at its highest level since...
7 September 2022
FTSE falls, GB Group targeted by private equity, Barratt reveals buyback as housing market shows resilience, Halfords motors higher, WH Smith dips despite reassuring update“Amid widespread selling in global markets, the FTSE 100 followed suit on Wednesday morning,” says AJ Bell Investment Director Russ Mould.
“Action on energy bills continues to be widely trailed as new prime minister, Liz Truss, prepares for an official announcement on her policy.
“Given the big package that is expected, anything short could spark...
6 September 2022
Berkeley ups prices to cover rising costs and retail stocks soar following energy bill relief reports“After yesterday sinking to a 37-year low against the dollar, the pound perked up on Tuesday, rising 0.2% to $1.1586 as the UK prepared for the changing of the guard at number 10,” says Russ Mould, investment director at AJ Bell.
“Reports so far suggest energy providers will be able to use government-backed loans to subsidise bills, meaning there...
5 September 2022
Gilt and currency markets could be the first real test for new PM“The stock market may well have its say on the new Prime Minister, but the response of the Government bond – or Gilt – market and the pound may be more telling, at least in the very short term,” says AJ Bell investment director Russ Mould.
“Financial markets express their faith – or lack of it – in a country and its economic and political...
2 September 2022
US jobs numbers in focus, Shell boss reportedly stepping down“There will be some relief on Friday morning that, for now, the recent wave of selling in global stock markets has eased,” says AJ Bell investment director Russ Mould.
“After US stocks broke a four-day losing streak overnight, the FTSE 100 has eked out modest gains, supported by a broad range of companies caught up in the sell-off.
“Housebuilders...
1 September 2022
Why the Fed has to keep hammering away at inflation“Psychologist Abraham Maslow wrote in the 1960s that, ‘If the only tool you have is a hammer, it is tempting to treat everything as if it is a nail.’ The US Federal Reserve has spent more than a decade trying to fuel inflation with the blunt instruments of interest rates and Quantitative Easing and now it has (over)done it, the central bank seems...
1 September 2022
US earnings forecasts creep down as costs creep upTuesday’s batch of economic data from the US may ease fears of a recession, as job vacancies rose, consumer confidence rebounded and house prices stayed firm, all eyes will now switch to Thursday’s manufacturing data.
The Institute for Supply Management’s purchasing managers’ index (PMI) for manufacturing is on a long losing streak that goes back...
1 September 2022
FTSE lower amid global sell-off, London recovery led by PPHE hotels“The start of September has not brought about any change to the current gloomy mood pervading markets,” says AJ Bell investment director Russ Mould.
“Further weakness in the US and Asia, with the rally of early August an increasingly distant memory, set the stage for selling in Europe. Reports of the US banning the sale of micro-chips by NVIDIA to...
31 August 2022
FTSE 100 steady despite selling in Asia and the US overnight, food prices soar, Dalata Hotels back in profit“The FTSE 100 clawed back some of Tuesday afternoon’s losses on Wednesday morning despite continued selling overnight in the US and Asia,” says AJ Bell Investment Director Russ Mould.
“As was the case earlier in the year, the FTSE 100’s collection of more attractively valued companies and healthy sprinkling of financials is helping at a time when...
30 August 2022
FTSE 100 up as pound sinks against the dollar, Joules insists Next deal remains on track“The FTSE 100 started on the front foot after the Bank Holiday, having careered into the long weekend with some substantial losses after Federal Reserve chair Jerome Powell’s hawkish speech at the Jackson Hole summit,” says AJ Bell Investment Director Russ Mould.
“It helps that US stocks have stabilised to some extent in the interim. Unsurprising...
26 August 2022
Markets poised for Powell at Jackson Hole, UK energy crisis deepens, Micro Focus catches $6 billion bid“The energy crisis continues to escalate in the UK as the latest price cap is announced but for the markets all the focus is on Jackson Hole where, this afternoon UK time, Federal Reserve chair Jerome Powell is set to outline his position on interest rates,” says AJ Bell investment director Russ Mould.
“Gains on Wall Street overnight have helped to...
25 August 2022
UK mortgage approvals and US jobs data UK mortgage approvalsJune’s mortgage approvals figure was 63,726 according to the Bank of England. That undershot economists’ forecasts, representing the seventh time in twelve that approvals had fallen month-on-month and the eleventh consecutive year-on-year decline.
Perhaps most tellingly, that figure also undershot the 12-month average that...
25 August 2022
Bunzl first-half results"After rising by around a sixth over the past year, Bunzl’s share price stands only a fraction below its all-time high, buoyed by June’s trading update, when chief executive Frank van Zanten raised the company’s guidance for 2022 for a second time. Bunzl now expects ‘very good’ revenue growth, compared to a prior forecast of ‘moderate’ growth, and...
25 August 2022
FTSE up after strong trading in US & Asia as Jackson Hole begins, energy producers in focus, CRH delivers double-digit price increases“The FTSE 100 took its cue from strong trading in the US and Asia to make gains on Thursday morning as investors await the crunch Jackson Hole summit in Wyoming,” says AJ Bell investment director Russ Mould.
“There’s a lot riding on US Federal Reserve chair Jerome Powell’s address tomorrow. Speculation is running so hot ahead of his remarks that it...
24 August 2022
Markets lose momentum, Whitbread plans major new hotel on the Strand and Allied Minds heads for the door“Markets seem to have lost their momentum following the rally since mid-June. Investors have become nervous once again, with all eyes on Federal Reserve chair Jerome Powell and what he says this coming Friday,” says Russ Mould, Investment Director at AJ Bell.
“Investors are worried that the US central bank will continue to raise interest rates at...
23 August 2022
FTSE lower as European gas prices surge, Wood Group revenue dips and BT in the clear over Drahi investment“The FTSE 100 was under pressure on Tuesday amid a gloomy global market outlook,” says AJ Bell Investment Director Russ Mould.
“The hopes earlier in the summer that inflation might have peaked, and the Federal Reserve might, in turn, ride to the market’s rescue, are looking increasingly forlorn.
“European natural gas prices saw a renewed surge...
22 August 2022
FTSE downbeat as Jackson Hole looms into view and Cineworld confirms possible bankruptcy filing“The FTSE 100 began Monday in downbeat mood ahead of what could prove to be a critical moment for markets at the end of this week,” says AJ Bell Investment Director Russ Mould.
“The Jackson Hole summit of central bankers and finance ministers is widely expected to see US Federal Reserve chair Jerome Powell take to the floor and puncture optimism...
19 August 2022
Weak consumer backdrop punishes pound, Just Eat gets cash injection from Brazil sale, and Joules goes from bad to worse with another profit warning“The FTSE 100 was broadly flat on Friday after a mixed set of retail sales, and with inflation driving the cost of servicing government debt higher,” says AJ Bell Financial Analyst Danni Hewson.
“The consumer backdrop feels increasingly gloomy and that’s bad news because consumer spending is such an important contributor to the UK economy.
“The...