Three key news stories unfolding as the UK stock market opens. Check out our companies reporting diary for upcoming results from FTSE 350 and selected international stocks.
1. Pennon taps shareholders for cash, cuts dividend
Utility infrastructure company Pennon LON:PNN issued a strategic update this morning with the new CEO advising that whilst there are bright spots within the business, more needs to be done to facilitate delivery. As such, a £550m rights issue has been launched with a 35% discount. The dividend policy is also being rebased and whilst the overall payout isn’t falling that much, this will have to cover the newly issued stock too. Shareholders are therefore being briefed to expect a 30% cut.
2. Long UK summer takes toll on Hollywood Bowl
Leisure operator Hollywood Bowl LON:BOWL always has the potential to attract attention, given it acts as a barometer of discretionary spending. Today’s full year update shows sales up 4.3% but that was weighted in H1 and the last few months in the UK have been punishing. Management are however pointing at the weather as being a key driver here rather than a shift in consumer sentiment, which may provide some support as the weather cools. Canadian operations continue well and the full year outlook has been reiterated.
3. Mixed guidance from Shell as US-Iran war impacts capacity
A mixed bag from Shell LON:SHEL in their Q3 production update this morning. Whilst integrated gas production has been guided around 20% higher, refinery utilisation and LNG liquefication volumes have both been revised down. These are two predictable outcomes of the ongoing war in the Gulf, on the basis it’s impacting the amount of product that can be processed.
- Broker Tips: Shell, Admiral, Barclays, NatWest, Reckitt Benckiser
- Shell’s balancing act: Profits, politics and the price of peace
In case you missed it
We start with a look at gold, which is once again attracting attention as strong precious metals sentiment, persistent inflation and heavy government borrowing fuel expectations of fresh record highs. We look at what is driving the bullish outlook – and what it could mean for investors with exposure to gold and silver.
We also take a look at the bond market, with France’s borrowing costs becoming a warning sign beyond its own borders. Our latest report considers what the French experience could tell investors about the wider government bond market as borrowing and fiscal pressures build.
In equities news, AIM-listed Christie Group is finding an unlikely source of optimism in Britain’s pubs and restaurants as more businesses are changing hands.
We also review the latest broker analysis, focusing on updates for Tatton Asset Management, Kier Group, A.G. Barr, Greggs and Vodafone – and how HgCapital is turning private market discounts into exit value with a buyer willing to pay up for one of its private technology assets.
Look out for updates from Netcall and Shell in the company diary today.
The AIM All Share was ticking higher on Tuesday, up just over three points at the early copy time of 2.15pm. That’s broadly in line with sentiment elsewhere across Europe with the index trading at 783.31.
- Mercantile Ports +59%
- Novacyt +17%
- Synectics +14%
- Eenergy -73%
- Celebrus -38%
Tony Cross
Tony Cross is a market commentator with over 25 years of experience, producing compelling, insightful copy for journalists and investors alike. Focusing on macroeconomics, UK blue chip equities and inter market analysis, Cross’s commentary is well regarded for its clarity and ability to cut through the waffle. He has been quoted in publications as diverse as The Financial Times, The Times, The Guardian and The Sun.
This article does not constitute investment advice. Do your own research or consult a professional advisor.
