Weekly Newsletters

06 May 2022 | William Buckhurst

That Was The Week That Was

MACRO

  • The Federal Reserve raises rates by 0.5% to combat inflation – the biggest single hike in decades
  • The pound continues to plummet as the Bank of England warns of a recession later this year

COMPANY NEWS

  • Shell shares rose after reporting first quarter earnings almost three times higher than the same period last year
  • Estee Lauder closed down 5.9% on the day, following a drop of as much as 13% at the open, after reporting net sales slightly below consensus while downgrading full year guidance mainly due to the impact from the new lockdowns in China
  • Zimmer Biomet shares rose after beating estimates and raising its 2022 guidance driven by Covid recovery and a return to elective surgery procedures

SMALL CAP NEWS

Sir Martin Sorrell’s S4 Capital finally produced solid but unremarkable annual results having been forced to delay their publication twice after auditors PwC said it was “unable to complete the necessary work”.  The company’s share price rose 4% to 339p on Friday but remains well down on its high of 870p last September

A WEEK IN FUNDS

News emerged that Terry Smith’s giant fund firm, Fundsmith, has been told to conduct a review of its business after being served a Section 166 notice by the FCA. Very little detail has been revealed about the motive for the 166 order as firms are banned from discussing the case while a review is being conducted

THIS WEEK IN HISTORY

1923: Bear Stearns is founded. The bank would never post a negative earnings quarter through its history until its spectacular failure in the 2008-09 financial crisis

2010: A “Flash Crash” causes the US stock market to fall 6%+ in just a few minutes. At one time, the Dow was down over 1,000 points (a little more than 9%)

IN OTHER NEWS

Elon Musk secured $7.1bn in additional funding for his $44 bn acquisition of Twitter, decreasing the amount he’ll have to borrow against Tesla shares and giving him a little financial relief. As you might imagine, the investors working with Elon are the usual smorgasbord of global finance. They include…Prince Alwaleed bin Talal, Larry Ellison, Sequoia Capital, and the VC firm Andreessen Horowitz. Ben Horowitz, a general partner at the latter, said “we believe in Elon’s brilliance to finally make [Twitter] what it was meant to be.”

MARKET DATA

% returns

1 Week

1 Month

1 Year

5 Years

UK Equities (% return)

-2.43

-3.19

1.27

1.91

World Equities (% return)

-1.03

-7.07

-2.86

47.52

10 Year US Treasury Yield (%)

3.05

2.61

1.58

2.34

GBP / USD (fx rate)

1.23

1.31

1.39

1.30

 

As at 6th May 2022. Source: Financial Express

 

 

 

 

 

 

 

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