News & Insight • Weekly Newsletters

20 January 2023 | William Buckhurst

That Was The Week That Was

MACRO

• US retail sales fell by 1.1% in December, more than expected
• The volume of retail sales in the UK also fell by 1% in December
• CLSA put out a 5% GDP forecast for China this year
• Christopher Waller, a governor on the board of the Federal Reserve, backed the US central bank to further slow the pace of its interest rate increases to 0.25% next month

COMPANY NEWS

• Goldman Sachs recorded its biggest earnings miss since 2011 while Morgan Stanley beat estimates thanks to strong performance from its wealth management division
• Vistry issued an encouraging trading update with a higher weekly private sales rate per outlet of 0.46 in the fourth quarter. They also generated an extra £100m cash that was not expected
• Netflix said that their CEO, Reed Hastings, is stepping down while also announcing they had added another 7.7m new subscribers over the last quarter
• At a capital markets day, Melrose said that its Aerospace division in GKN traded in line with expectations in 2022 and was showing “good momentum” so far in 2023
• Britishvolt has collapsed into administration with the majority of its 232 staff made redundant with immediate effect on Tuesday

CHINA RE-OPENING

As we jump into the year of the rabbit, the prospect of China’s reopening post Covid has positive aspects for many sectors, Amin Nasser the CEO of Aramco cautioned the impact of this on global oil supplies saying “we should be worried about the mid to long term” a view supported by the International Energy Agency

INTERESTING ELSEWHERE

PWC published their 25th Annual Global CEO survey this week. Some interesting findings include: the UK has overtaken China as US CEOs’ favoured growth market; UK CEOs are also optimistic about both the global economy (82% expecting it to improve) and the UK economy (73% expecting it to improve) over the coming year

SMALL CAP

Ashtead Technology, the offshore equipment lessor for the oil, gas, and renewable sectors, saw continued strong trading momentum through its final quarter, combined with enhanced current contracts. Full year sales and margins are now expected to be better than market consensus. Post this update, BP Inv2B Bidco, (Buckthorn Partners) combined with the CEO and CFO then sold 19.4% of the issued share capital which should add to the liquidity in the shares.

Following an announcement that this year’s performance will be “materially below expectations”, all eyes will be on the ITM Power Interims later this month, where the new CEO, Dennis Schulz, will provide guidance and strategic priorities. This will cover three main areas: 1) concentrating the product portfolio on a core suite 2) future testing capabilities and automation 3) capital allocation and costs.

THIS WEEK IN HISTORY

1983: Apple announces "The Apple Lisa" the first computer to have a graphical user interface GUI and a computer mouse. The Lisa was targeted at businesses and cost a massive $9,995 and because of its high cost never made the impact Apple hoped for

2011: Rudolf Elmer, a former Swiss banker, is put on trial after being accused of money extortion and breaking banking secrecy laws. Elmer had admitted to providing details of Cayman Islands accounts to the website Wikileaks

DAVOS WEEK

200 millionaires sent an open letter to the politicians in Davos this week saying: “Tax the ultra-rich and do it now. It’s simple, common-sense economics.”

IN OTHER NEWS

As 500 of Twitter’s top advertisers continue to pause their use of the platform, the firm has allegedly seen a 40% drop in daily revenues. In other Elon Musk news, the Head of Tesla’s Autopilot division testified that a 2016 video claiming that no human input was needed in the demo of a self-driving - was in fact staged

MARKET DATA

As at 20^th January 2023. Source: Financial Express

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