Maitland/AMO Morning Monitor – Friday 4 September 2020

4th September 2020

In the news

  • Number 10 is coming under increasing pressure to revoke the appointment of former Australian prime minister Tony Abbott as a trade adviser amid growing condemnation of his misogynistic and homophobic comments and dismissal of climate change.
  • Latest government figures have revealed that the number of weekly positive COVID-19 cases in England has increased to its highest level since the end of May.
  • The Chancellor's "eat out to help out" exceeded the Treasury's estimates with 100m meals eaten at an interim taxpayer cost of £522m by the end of August.
  • Pret a Manger has announced that it will shift to dinner deliveries to city dwellers and open more suburban branches to revive its business.
  • The CMA has opened an investigation into four of the UK's biggest housebuilders over the sale of leasehold properties.

Politics today

  • HS2 has announced the formal beginning of the construction of the high-speed rail line between London and the West Midlands.
  • The ONS will release its infection survey statistics for England this afternoon.

Stock market moves

  • China’s CSI 300 index of Shanghai and Shenzhen listed stocks dropped 1.6%, while Japan’s benchmark Topix fell 1% and Hong Kong’s Hang Seng dropped 1.8%.
  • The falls in Asia followed a hectic day on Wall Street, where the Nasdaq Composite index fell 5% while the S&P dropped 3.5%.
  • In Europe, the FTSE 100 and Euro Stoxx 600 are both down 0.3% and 0.4% respectively in early hours.
  • Brent crude fell 0.8% to $43.71 a barrel and gold rose 0.3% to $1,936.48 a troy ounce.

Corporate announcements

* Maitland Client

The Berkeley Group Holdings PLC Trading Statement
  • The Group’s trading has been resilient and supports its existing guidance of £500 million of pre-tax profit for the full year and its commitment to its shareholder returns programme of £280 million per annum.
  • Sales pricing has been robust above its business plan levels. This has been supported by the demand for Berkeley properties in under-supplied markets, good mortgage availability and the support from Government for the sector.
  • It anticipates a more split profit between the first and second halves of the year, reflecting levels of production that have been better than initially anticipated and its decision not to furlough staff.
  •  The Group currently has net cash in excess of £1 billion, ahead of next week’s dividend payment.
Witan Investment Trust PLC New global manager appointments
  • The Group’s appointment of WCM Investment Management and Jennison Associates as new investment managers has now been completed, with the portfolio transition taking effect during the latter part of August.
  • WCM has been allocated $200m to manage (8% of Witan’s assets). The portfolio is concentrated in 30 – 40 high conviction investments with the objective of securing long-term excess return and downside protection.
  • Jennison has been allocated $100m to manage (4% of Witan’s assets). The portfolio typically has between 35 and 45 holdings and securities must meet stringent standards in order to remain or earn a place in the portfolio.
  • Andrew Bell, CEO, said: “We are delighted to add WCM and Jennison this month to our list of managers. They specialise in high-conviction investments in rapidly growing companies and those with increasing competitive advantages that should enable them to win market share and achieve superior business results.”
Centrica PLC Purchase of customer base of Robin Hood Energy
  • The Group, through its British Gas business, has agreed to acquire the energy supply customers of Robin Hood Energy Limited for an undisclosed sum.
  • Completion of the transaction is expected on 16 September with customers moving to British Gas over the next few months.
  • Customers will be given information on the process of moving and will be offered a British Gas tariff.
  • Chris O’Shea, CEO of Centrica, said: “We are pleased to be able to offer every customer moving to British Gas a tariff which means their price will not be any higher and, importantly, they will be supplied with green electricity and have access to a range of other benefits – such as British Gas Rewards with free energy days and exclusive offers on services such as boiler cover.”