News & Insight • Weekly Newsletters

07 April 2023 | William Buckhurst

That Was The Week That Was

Wishing all our readers a very happy Easter!

MACRO

• Oil was up strongly as OPEC+ surprised the market and cut supply by 1.6m barrels a day. This was apparently in reaction to the US stating that they were not in a hurry to rebuild the Strategic Petroleum Reserve after drawing down supplies to help quash inflation
• Weaker economic data from the US as the ISM Services number was far lower than expectations despite hawkish comments from more Fed members
• US non-farm payrolls increased by 236,000 in March, following a 311,000 gain in February. Economists had predicted an increase of 230,000. Hourly wages were also up 4.2% year on year. Bond yields rose slightly

COMPANY NEWS

• Shell released a positive trading statement highlighting strength in gas production
• Aesop was acquired by L’Oreal from Natura (owner of The Body Shop and Avon) for $2.5bn in the largest deal the French company has done to date
• Toyota announced a new strategy as Koji Sato took over, targeting 1.5m electric vehicles by 2025 with ten new models
• Institutional caterer, Sodexo, had strong numbers as offices continue to outsource their refreshment offering
• Another disappointing update from Randall & Quilter as they predict an annual loss and unveiled plans to separate its programme management business
• Johnson & Johnson raised their offer to $9bn (from $2bn) to try to settle lawsuits it faces that claim its baby powder and other talc-based products cause cancer
• Virgin Orbit is no longer flying after the company was put into Chapter 11 after failing to raise more money. The company was founded in 2017 and is a spin-off from Sir Richard Branson's space tourism company Virgin Galactic

TECH WEEK

The strong performance year-to-date from Artificial Intelligence (AI) shares came grinding to a halt this week when short seller, Kerrisdale Capital, wrote to Deloitte & Touche LLP about "serious accounting and disclosure issues" at C3.ai, one of the top trending AI stocks. This led fellow AI plays Guardforce AI, BigBear.ai and SoundHound AI all lower

SMALL CAP NEWS

Bruce Springsteen once described the origins of his nickname: the name 'Boss' started with people that worked for me... It was not meant like Boss, capital B, it was meant like 'Boss, where's my dough this week?'. Toyko-listed food company Toridoll Holdings clearly agree as it approached pizza and Mediterranean food business, Fulham Shore (owner of Franco Manca and The Real Greek) with a takeover at 35% premium to the share price. Wasabi owner, Capdesia are also involved, having an option to 49%

THIS WEEK IN HISTORY

• 1993: Phillip Morris shares plummet 23% on the day – a day which became known as “Marlboro Friday” following a surprise announcement that Phillip Morris was cutting prices on its iconic Marlboro brand
• 2007: The first major sign of trouble in the housing crisis as New Century Financial declares bankruptcy

IN OTHER NEWS

Can you smell what The Rock is cooking?! WWE, previously known as the World Wrestling Federation, the world’s largest professional wrestling promotion, famous for Jake “the Snake” Roberts, Andre the Giant, Hulk Hogan and Dwayne “The Rock” Johnson, is sold to Endeavor Group Holdings (owner of Ultimate Fighting Championship) in a deal which values the company at $9.3bn

MARKET DATA

 As at 7^th April 2023. Source: FactSet

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