News & Insight • Weekly Newsletters

29 March 2024 | William Buckhurst | Charlie Todd

That Was The Week That Was

Wishing the readers a Happy Easter!

MACRO

• US jobs and inflation data – PCE price index increased at a 2.5% annual rate, up from 2.4% and the core number was hotter than expected but Jerome Powell suggested the figures were “along the lines” of what they wanted
• US Q4 GDP figure was revised up to 3.4% whilst US consumer sentiment hit its highest level since 2021
• The FT reported on an independent Congressional Budget Office chief suggesting that the US facing Liz Truss-style market shock as debt soars
• Turkey’s opposition parties win major city elections – Istanbul and Ankara in particular – in a dent to Erdogan
• FTX founder Sam Bankman-Fried sentenced to 25 years

COMPANY NEWS

• Rock, paper scissors – investors in DS Smith will be hoping for more solid foundations to a new bid from International Paper as the other offer from Mondi was shredded
• One of the outcomes from the Nike results was that it admitted that more of its goods would return to being sold through normal retail channels. A positive for JD Sports which the latter boosted with some better than expected results. Same goes from H&M
• Legalisation of gambling in the States is gaining momentum and the two beneficiaries are Flutter (Paddy Power Betfair) and Draftkings. Having said that – and after both reporting decent results – the share prices drifted lower due to reluctance of college sports to join
• Diploma, one of the best run UK listed companies, announced an opportune deal for a US business, making the shares react positively
• Fevertree looks to be running itself for a sale. The figures were good – US is now its largest market – but management are still investing for growth
• McCormick & Co – the spice experts – announced hotter than expected results sending their shares higher
• The market reactions to some shares look extreme. An example of this would be UPS, who announced good numbers but the shares fell by 9% - perhaps the efficiency of the Amazon logistics network is impacting
• Its only taken nearly 20 years but since the lawsuit was filed in 2005 both Visa and Mastercard have been fighting an antitrust case brought upon by merchants. The $30bn settlement is to lower swipe fees merchants pay when customers use their VISA or Mastercard
• All aboard the Boeing merry-go-round as CEO, Dave Calhoun, Chairman, Larry Kellner and head of Commercial Aerospace, Stan Deal will all leave shortly
• AdvancedADVT had a positive update as Vin Murria and her team continue to look to make improvements to the businesses the company bought from Capita whilst on the hunt for some new acquisition targets

RETIREMENT HOME

We are keen observers of changing rates (mainly birth and death) plus demographics in countries and Japan (and southern Europe for that matter) are suffering from years of low birth rates. Japan now has one of the world's oldest populations, with almost 30% of them aged 65 or older. Last year, the proportion of those aged above 80 surpassed 10% for the first time.

In that vein one bit of news caught our eye. It was announced that a Japanese nappy maker (Oji Holdings) will stop producing nappies for babies in the country and focus on adults.

The BBC article suggested sales of adult nappies outpaced those for infants in the country for more than a decade. The number of babies born in Japan in 2023 - 758,631 - was down by 5.1% from the previous year. In the 1970s, that figure stood at more than two million.

In a more youthful tone, Oji Holdings said it produces 400m infant nappies annually and would continue to make baby diapers in Malaysia and Indonesia where demand is growing.

THIS WEEK IN HISTORY

1867: Russia sold Alaska to the US for $7.2m

2000: Stock markets hit a peak. The tech-centric Nasdaq was the epicentre of the dot-com bubble, but a rising tide lifts all boats. In the two years leading up to March 24, 2000, the S&P 500 had gained 38.1%

MARKET DATA

As at 29^th March 2024. Source: InFront

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