Companies reporting w/c 24 April include Barclays, RBS and Lloyds Bank
Category: Investments, Shares
Companies reporting today include: Anglo American (Q1 results) - HOLD
Companies reporting today include: St James’s Place – BUY, Whitbread (Q4 results)- HOLD, BHP Billiton (March operational review) - BUY
Croda International (Q1 trading update): Our view - HOLD
A speciality chemical group which has a defensive element to the business as highlighted by a comment from the previous CEO: “we appeal to two things that will never go away, vanity and ageing.” The group are keen to buy into new technologies, introduce more specialist products and invest in niche markets in order to further boost growth. It also hopes to increase the group's presence in Asia and Latin America. With the shares close to an all-time high, investors will be expecting a continuation of improving sales trends.
Standard Chartered (Q1 results): Our view - HOLD
The health of emerging markets is key for the bank, which as a result of its past aggressive expansion has been in restructuring and recovery mode over the past two years. Investors will be focussing on costs and hoping that the banking situation is stabilizing. Any comments on the outlook for important countries such as Hong Kong, China and Singapore, along with others in the region will be worth noting.
GlaxoSmithKline (Q1 results): Our view - BUY
After posting a good set of 2016 results investors will expect some of that momentum to flow through into the first quarter of the year. There will be a positive impact from currency movements but investors will also expect to see sales of new drugs make a bigger contribution to overall sales and help mitigate sales declines of out of patent drugs. Progress reports on R&D projects and expectations of further FDA submissions will be welcomed by investors.
Companies also reporting today include: Antofagasta (Q1 results) – HOLD, Fresnillo (Q1 results) – HOLD, London Stock Exchange (Q1 results) – HOLD, Tullow Oil (Q1 trading update) – BUY, CRH (Q1 trading update) – HOLD, GKN (Q1 trading update) - BUY
AstraZeneca (Q1 results): Our view - BUY
Indications from management in recent quarters have been that we are at or near the worst effects of patent expiration and generic competition on group sales. Crestor is the current blockbuster drug seeing a huge falloff in sales but other new drugs in its portfolio and R&D pipeline should in time lead to sales growth again. This will be reflected in its growth platforms such as Diabetes and sales of Brilinta as well as continued penetration into the emerging markets.
Companies also reporting today include: Lloyds Banking Group (Q1 results) – HOLD, Persimmon (Q1 trading update) – HOLD, Schroders (Q1 results) – HOLD, Taylor Wimpey (Q1 trading update) - HOLD
Barclays (Q1 results): Our view - HOLD
The share price has struggled to make any head way this year. Results in February stated that the end of the group’s restructuring is in sight, as is the return to dividend growth. Investors will be hoping for further signs that the firm’s problems are now more in the past. As ever the performance of the still important investment banking division will be worth noting. Costs and the outlook for the UK, US and Barclaycard are other areas to concentrate on.
Royal Bank of Scotland (Q1 results): Our view - SELL
Investors will be looking for an update on its cost cutting plans and the shift towards retail and commercial banking, along with management comments on the progress of their long term recovery plans and the slimming down of the balance sheet. A profit has been forecast for 2018, although the share price has yet to get back to pre-Brexit levels.
Announcements w/c 24 April 2017
April 25, US Consumer Confidence Index, April 2017 – Conference Board
Last month this closely watched index rose to a 16 year high, and in the process pointed to a strong period ahead for the US economy, led by the consumer sector. It would be a surprise if the index tracking April rose even further, but will it point to a continued level of exceptional US consumer confidence?
April 28, US Gross Domestic Product (Advance), Q1 2017 – Bureau of Economic Analysis
Recent purchasing manager’s indexes were consistent with annualised growth in the US economy of around 2.5% in Q1 of this year. Will today’s data bear this out? With US consumer confidence surging in recent months, the data may surprise on the upside.
April 28, UK GDP, preliminary estimate: January to March 2017 – Office for National Statistics
Surveys point to a slowdown in the rate of UK growth at the beginning of this year. The most recent estimate of UK growth in Q4 2016 recorded a 0.7% rise in the quarter. The most recent purchasing manager’s indexes were consistent with 0.5% quarter growth in Q1, but with retail sales struggling so far this year, that may prove optimistic.
Further announcements include
- Quarterly Industrial Trends Survey – Confederation of British Industry
- UK public sector finances: March 2017 – Office for National Statistics
- Quarterly Distributive Trades Survey – Confederation of British Industry
- Governing Council of the ECB: monetary policy meeting in Frankfurt – European Central Bank
- Insolvency Statistics: January to March 2017 – Office for National Statistics
- UK index of services: February 2017 – Office for National Statistics
- Flash Estimate Euro area inflation, April – Eurostat
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