News & Insight • Weekly Newsletters

26 April 2024 | William Buckhurst | Charlie Todd

That Was The Week That Was

MACRO

• President Biden signs a $95bn foreign aid package which includes $61bn for Ukraine
• Mixed data from over the pond as inflation adjusted growth figure came in at 1.6% for the first quarter (lower than expected) but also showed core inflation jumped to 3.7% from 2% in the final quarter of 2023
• The UK’s main market went through all-time highs due to some M&A action (mentioned below) as more value orientated markets recover – Hong Kong’s market has also started to recover
• The Bank of Japan kept interest rates on hold leading to the Yen to drop to 34-year lows against the Dollar

COMPANY NEWS

• A busy week as reporting season is in full swing
• Alphabet (previously known as Google) had very good results – Dan Ives of Wedbush Securities suggested the print should be hung in the Louvre – with the company beating expectations across every part of the business and declaring a maiden dividend alongside a buy back
• Microsoft was another company benefitting from the continued strength of its cloud computing division and the largest listed company managed to grow by 17%
• Facebook and Instagram owner, META, announced good results but the shares fell in reaction to Mark Zuckerberg declaring further capital expenditure for its AI capabilities. On the flip side fellow social media platform SNAP beat low expectations and its shares rose
• Expectations for Intel were very low coming into results and the company still managed to disappoint
• Having had its shares fall by over 35% since the beginning of the year, Tesla was under pressure. The numbers were nothing to shout about but then, arguably one of the world’s leading entrepreneurs, CEO Elon Musk started the earnings call and spoke about his future vision for the business – shares flew 14% higher
• Things are starting to hot up in the commodities market. After recently announcing some good results, BHP Group were out shopping this week to boost their copper assets and tried an “opportunistic” £31bn offer for Anglo American
• Good results for both Sanofi and Bristol Myers Squibb but different share reactions – Sanofi, up, BMS, down
• Mixed results from the UK listed consumer staples companies Reckitt Benckiser and Reckitts still have the cloud of the baby formula litigation over them but still think the company can match market expectations for the year. On the other hand, Unilever look to have come through some painful times and Hein Schumacher’s turnaround seems to working
• Danaher is a brilliant company – the Danaher Business System is worth a read – and had results to match with contributions from respiratory testing and bioprocessing segments
• Spotify announced a strong set of numbers as music linked businesses continue to perform well

TAKEOVERS

We mentioned the “genius” Irish trainer Willie Mullins on his plundering of the Cheltenham Festival loot in mid-March. This paved the way for him to become the first Irish based trainer to be crowned champion trainer in Britain since “the great” Vincent O’Brien 70 years ago – confirmed this week. Unfortunately, this matches the UK stock market as a number of companies are being sold to international buyers – the latest approach being Darktrace by private equity company Thoma Bravo for £4.3bn. Would the last UK listed company in the UK turn off the lights?

THIS WEEK IN HISTORY

1962:  Ariel 1 was launched by NASA to perform British experiments. Named after the spirit in Shakespear’s The Tempest, it made the UK the third country to operate a satellite from US and USSR

1986: Chernobyl disaster – the worst accident in the history of nuclear industry, killing two workers immediately and a further twenty-eight over the following weeks

MARKET DATA

 As at 26^th April 2024. Source: InFront

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