Weekly Newsletters
22 July 2022 | William Buckhurst
That Was The Week That Was
MACRO
- The European Central Bank (ECB) raised rates by 0.5%, the first hike in 11 years
- Eurozone business activity, as measured by the flash composite PMI, fell to a 17-month low
- UK annual inflation rose to a new 40-year high at 9.4%
- Mario Draghi’s fragile coalition of left and right political parties fell apart and it has become increasingly likely that Italy will be forced into early elections in the autumn
COMPANY NEWS
- ASML beat expectations on sales and profits but lowered forward guidance from 20% sales growth to 10%
- Netflix shares finished the week higher as its Q2 subscriber numbers fell by 970,000 rather than the 2 million expected
- GSK completed the demerger of its consumer healthcare business, Haleon
SMALL CAP NEWS
It’s not you, it’s me. Although we prefer companies to be listed, sometimes it does not work out. Stanley Gibbons, the philatelic experts (postage stamps), announced it would delist on Friday citing costs and “negative operational influences” whilst also announcing the CEO, Graham Shircore, would be returning to work with the largest holder of the company, Phoenix Asset Management Partners.
We mentioned the S4 Capital delay in the audit of results previously, but they followed that up this week with a warning on profit margin sending their shares lower again – this time by a mere 38%. Since this company was set up by Sir Martin Sorrell it had had a meteoric rise – at one time being capitalised at roughly half the size of his previous company, WPP – but has subsequently slumped for several aforementioned reasons. We will look with interest for any signs of renaissance as the market cap sits at sub £900m compared to WPP at over £9bn!
THIS WEEK IN HISTORY
1968: Intel is founded by Robert Noyce and Gordon Moore with $2.5m in capital. It is worth $160bn today
1969: The first man on the moon. The US stock market closes the following day to celebrate
IN OTHER NEWS
The future of Arm, which for a while looked as if its owner Softbank would be partially relisting in London, is now in the balance as a result of recent UK government turmoil. With the recent resignations of the Investment and Digital Ministers - who had both lobbied hard for a London listing - pressure is off and New York is now the most likely place for it to be listed. Sir Alex Younger, the former head of MI6, had previously stated the UK should “strain every sinew” to keep the chip designer in the UK
MARKET DATA
|
% returns |
1 Week |
1 Month |
1 Year |
5 Years |
|
UK Equities (% return) |
1.56 |
2.65 |
7.17 |
-3.16 |
|
World Equities (% return) |
2.67 |
4.91 |
-9.63 |
40.26 |
|
10 Year US Treasury Yield (%) |
2.77 |
3.16 |
1.30 |
2.34 |
|
GBP / USD (fx rate) |
1.20 |
1.23 |
1.38 |
1.30 |
As at 22nd July 2022. Source: Financial Express
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