News & Insight • Weekly Newsletters

06 November 2020 | William Buckhurst

That Was The Week That Was

MACRO

• In a closer result than many anticipated, the week finished with Joe Biden clearly heading for the White House
• While the US election gathered the headlines, it went largely unnoticed that the US posted three consecutive days of record new Covid cases
• In the UK, Rishi Sunak extended the furlough scheme to March

STATISTIC OF THE WEEK

While the Bank of England continues to print more money, the sheer size of the numbers involved can obscure the true scale of the stimulus. To put the numbers into some perspective, the new £150bn quantitative-easing programme announced this week is equivalent to £5,500 for every household in the country and the Bank will soon own between a third and half of all UK government debt

COMPANY NEWS

• Ocado shares closed up on the week after upgrading guidance and announcing two acquisitions (robotics companies Kindred Systems and Haddington Dynamics) They are now expecting full year EBITDA to be over £60m, compared to the prior guide of over £40m
• Linde raised its expectations for full-year earnings as it reported better than expected quarterly results, citing increased industrial gas volumes and higher pricing
• Paypal beat comprehensively on Total Payment Volume (+36% vs +30% estimates) and on earnings. But they did not provide a 2021 outlook citing significant variability in macro-related factors

SMALL-CAP NEWS

Corporate activity in the small cap space continued late on Friday with an announcement that Codemasters, one of the UK’s leading gaming companies, is to be taken over by the American business Take Two Interactive Software in a cash and share deal for $973m. Codemasters are highly thought of within the gaming community for their expertise in driving games (F1, Dirt, and Grid for example) but they also published legendary games in the 90’s such as Brian Lara Cricket and Jonah Lomu Rugby

THIS WEEK IN HISTORY

1907: a boat organised by J. Pierpont Morgan arrives in New York from London with $7m worth of gold, which helps calms markets after the 1907 stock market panic triggered by the bankruptcy of two US brokerage firms

2015: billionaire hedge fund manager, Xu Xiang - known as China's Warren Buffett - is arrested for allegedly manipulating the stock market during the 2015 Chinese stock market turbulence

LOCKDOWN II

Customer insights start-up Streetbees has just raised another $40m from leading venture capital firms. It is another example of how tech-savvy consumers known as “bees” can be paid while staying at home. “Work” might include taking a photo of the equipment they use to make a cup of coffee, and then answering a series of questions about where they bought the beans from and what time of day it is. Answers are then analysed using artificial intelligence to determine general trends in how people think about a brand, allowing companies to target their advertising. It has proved popular with some of the world’s biggest brands including Unilever, PepsiCo, Sony Pictures, Carlsberg and has grown revenues 150% over the last year.

MARKET DATA

As at 6^th November 2020. Source: Financial Express

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