FTSE 100 JD Sports boosted by Nike, Trustpilot crashes, oil at $115
Rising revenue forecast doesn’t make up for mounting losses for Oxford Nanopore investors
Investors reacted negatively to lower earnings at biotech firm Oxford Nanopore Technologies even as the company improved its revenue forecast for its core division.
Shares of the company, which soared 45% on its first trading day in September last year, valuing it at £5billion, fell nearly 7% to £4.11 after the company revealed that an increase in investments and a drop in revenue linked to Covid-19 had weighed on profits.
Even though gross profit margins jumped to 54.8% (from 41.2% in 2020), the company couldn’t prevent its adjusted operating loss from widening more than 13% to 82.9 million. of pounds sterling.
The company said its expected reduction in revenue from Covid-19 testing, which fell to £6.7m last year from £48.3m in 2020, as well as new investment in the company, had received the profits.
However, management has updated revenue guidance for its core life science research tools division, pushing expectations for 2022 to £145-160m (from £135-145m previously) and those for 2023 at £190-220m (previously £170-170-190m).
Chief executive Gordon Sanghera said his company, whose technology enables the sequencing of single molecules, has enhanced its technology offering, “which now enables even more complete genomic information and breadth of application, while remaining – above all – accessible in order to maximize the potential benefits to society”.
LME plans to ban Russian metals
The London Metal Exchange is discussing with governments whether to continue to allow delivery of Russian metal through its network of warehouses, chief executive Matthew Chamberlain has said.
The LME wants to make sure it “can’t help fund any kind of atrocity,” he told Bloomberg TV in an interview.
However, the exchange will take its cue from government policy, and major Russian metal producers are not currently subject to sanctions.
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Kingfisher surpasses £1bn in profit
B&Q and Screwfix owner Kingfisher became just the third UK retailer in history to break the £1billion mark today as its boss pledged to keep battling rivals on prices amid cost of living pressure.
The company said pre-tax profits last year topped the £1billion mark – an achievement matched only by Tesco and Marks & Spencer in the UK retail sector – as the DIY boom in the pandemic era continued even after lockdown restrictions eased. He hands over £550million to investors.
Thierry Garnier, chief executive, said profits and sales of £13 billion for the year to January 31 were the highest in Kingfisher’s 40-year history.
But there are signs that the home improvement boom that propelled it to such heights may have already peaked: Sales so far this business year are down 8% from the last, but still 16% above what they were two years ago.
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CBI: 8 out of 10 factories see more inflation
Inflation is expected to persist as new data shows that the percentage of factories planning price increases has risen to its highest level in more than 45 years.
A new survey from the Confederation of British Industry (CBI) shows that 80% of manufacturers plan to raise prices in the next three months, a record since the question was first asked in 1975.
Anna Leach, CBI’s deputy chief economist, said that while production and order books were strong, cost pressures that had been “amplified by the conflict in Ukraine” could not be ignored.
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Trustpilot falls by a fifth
Shares of online review platform Trustpilot fell 23.7% on Tuesday morning after the company reported mounting losses for 2021 and forecast a similar trend for this year.
The company went public in March last year, with its shares trading at 265p. On Tuesday they fell as low as 123.4p.
Trustpilot posted a pre-tax loss of $25.9 million, more than double the previous year, due to costs largely related to the IPO.
He also warned that administrative expenses had increased in proportion to his income and he expects those expenses to remain at broadly similar percentages in 2022 due to cost inflation.
The company also posted positive numbers, increasing its revenue by 29% to $131.4 million in 2021, from $102 million in 2020.
Jessica Pok, analyst at Peel Hunt, noted that the company intends to invest more.
“This is something we support as we believe capturing more market share for Trustpilot now will lead to stronger potential monetization in the future,” she said.
“However, in these volatile markets, we expect weakness in equities today as earnings decline.”
Lenders add momentum to FTSE 100
Interest rate bets on lenders including HSBC did not dampen London’s momentum as traders also returned to JD Sports Fashion after a long period of inactivity.
The FTSE 100 index rose a further 41.55 points today to 7483.94 and is now back close to where it was before Russia invaded Ukraine just under 20 years ago. a month.
AJ Bell Chief Investment Officer Russ Mold said: “This doesn’t mean investors have ignored the first major war in continental Europe in a generation, but it does reflect an index that is relatively well positioned in the current environment.
“It has substantial commodity exposure, a decent yield that is attractive in an inflationary environment and more discounted valuations than seen in other global markets.”
In contrast, he noted that the US S&P 500 index and Germany’s DAX index are down 7% and more than 10% respectively since the start of 2022.
Bank stocks topped the London riser chart after US Federal Reserve Chairman Jerome Powell announced a more aggressive stance on interest rates to bring inflation under control.
His comments boosted banks’ margin outlook, with HSBC the biggest beneficiary after rising 3% or 17.6p to 518.4p. NatWest, which is most suited to interest rate hikes in the UK, added 6.9 pence to 222.7 pence.
JD Sports Fashion jumped 3% or 5.15p to 154.05p after last night’s better-than-expected third quarter results from Nike boosted confidence, particularly after the US giant increased its margin against cost pressure.
Shares of JD are down a quarter this year, but Peel Hunt thinks worries about a consumer slowdown are overblown and thinks shares should be down 280p.
The FTSE 250 index also rose 88.98 points to 21,095.54, with the Softcat IT services business up 7% after its interim results. But consumer reviews firm Trustpilot remains out of favor, slipping 17% or 26.8p to a new low of 135p, as strong 2021 numbers were overshadowed by its investment and inflation forecasts. costs.
LME faces lawsuit over nickel debacle
The LONDON Metal Exchange is facing possible legal action from hedge funds over chaos in the nickel market which saw $4 billion in trades suddenly cancelled.
Hedge funds and other market participants are taking advice and have been told there are legal grounds for a potential multimillion-pound claim.
Two weeks ago, the LME suddenly suspended trading after the price of nickel doubled. He then called off the deals, a move that helped Tsingshan Holding, a Chinese steel producer that was “short” in the market.
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A good chancellor, for reasons he doesn’t like
IT is possible to see Rishi Sunak as a kind of Shakespearian character, trapped in circumstances that are not of his making, constantly forced into actions contrary to his own instincts.
Also, defying his own will turned out to be the right thing to do. It must be boiling.
Returning to the start of the Covid crisis, our Chancellor quickly understood that there was no other solution than to invent money and spend it.
The furlough scheme in particular can be considered the most successful government intervention ever.
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S&P pulls out of Russia
S&P Global Ratings has suspended operations in Russia as sanctions against Vladimir Putin’s regime continue to rage.
The European Union announced last week that it would ban the provision of credit ratings to any person or entity based in Russia from April 15 in light of the conflict in Ukraine.
S&P said it would end its operations in the country before that deadline, but declined to comment on how many Russian companies it currently serves.