Pivot back to fossil fuels
Macro & Overnight
US and world bond market yields rose yesterday as equity markets returned to risk-off mode. The gold price continued its move higher.
Meta reported decent results overnight. It signalled global advertising headwinds.
UK Company News
Renishaw updated trading conditions remain challenging due to subdued demand, most notably from the semiconductor sector. It continues to see positive investment trends in robotics, defence, low-emission transportation and additive manufacturing.
Like Meta in advertising trends or Next for understanding the UK consumer, Renishaw is an excellent way to take the pulse of the world’s advanced manufacturing industries. Renishaw says life is tough for semiconductor manufacturers, but there are some bright spots in other areas. Additive manufacturing, or 3D printing, will likely be a positive for Xaar, which manufactures print heads.
Safestyle updated that its proposed fundraising has stalled, and the business is now entering a sale process.
It looks like the end of the road for this supplier of replacement doors and windows.
Hunting updated that it has received a large order in South America for its titanium stress joints amidst an overall group performance in line with the recovery trajectory it has been on over the last two years. Year-to-date EBITDA of $75 million reflects a near doubling compared to the same period in 2022, as the focus on energy security and global economic growth increases. It said H2 cash generation meant it should end the year with a debt-free balance sheet.
Greencoat UK Wind, a prominent investor in UK wind projects, announced a dividend increase and share buyback proposal suggesting a capital allocation policy reflecting the deteriorating economics of investing in offshore wind. Shell also reportedly (in The Times today) redeploying people away from renewable projects to oil & gas. These stories indicate that the world is pivoting back from its “renewables at any cost” policies to which we have become accustomed. Hunting is a significant beneficiary of this trend of capital reallocation back into fossil fuels, particularly in South America.
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