Market Prognosis

A concise summary of the major macro events of the past 24 hours, and selected UK company-specific news.

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March 6, 2023

Should I Stay or Should I Go?

Macro & Overnight

China’s Congress has agreed to a 5% growth target for 2023. Given the CCP marks its own economic homework, Chinese macroeconomic statistics are not dependable. However, a low single-digit growth rate will unlikely be sufficient to support global growth if Western economies slow.

The vitality of the UK stock market for primary listings dominates the UK financial press as companies leave London for other venues or ownership structures. (See HyperNormalTimes post).

There are signs of lobbying via the media ahead of the UK Budget in a couple of weeks. Shell’s new chief executive, Wael Sawan, said in the Times today that the US is more attractive for energy investment than the UK.

Fed Chair Powell will give testimony to Congress tomorrow and Wednesday.

US JOLT job openings data are on Wednesday, and nonfarm payrolls Friday.

UK GDP numbers are reported on Friday.

UK Company News

WANdisco, the cloud data software company, confirmed press reports that it is exploring a US listing alongside its AIM listing. 

The world’s largest shipbroker and ship finance specialist Clarkson reported solid results and a strong outlook statement. FY results showed underlying profits up 45%, with a strong performance in the Broking segment. It will pay a dividend of 93p, giving rise to a 20th consecutive year of dividend growth. Its forward order book is up 31%. It has a strong balance sheet and is confident that supply-side constraints brought about by years of underinvestment and the pressure on shipowners and charterers to decarbonise will provide significant opportunities for Clarksons long into the future.

US hospital software provider Craneware issued H1 results. Revenues increased 6% while profit fell 8%. Customer retention remains strong, at above 90%. The company said building blocks are in place for growth acceleration as the current pressures within the US healthcare market abate. It is confident in delivering results for the year per the current (downgraded) consensus.

James Fisher, the specialist marine engineering services company, issued a trading update. It reported good strategic and financial progress during 2022, disposing of three businesses, agreeing to sell the Swordfish dive support vessel and generating good revenue and underlying operating profit growth across the Marine Support, Offshore Oil and Tankships divisions. It also announced the disposal of its specialist nuclear engineering division. It expects to report revenue from continuing operations of c.£475m (2021: £442.4m). Underlying operating profit from continuing operations is anticipated to align with 2021. It also expects to remain within its banking covenants and has commenced discussions with its lending group regarding borrowing facilities, with maturity dates ranging from October 2023 to September 2024. James Fisher remains a recovery play, but the new CEO is getting on with things. 

Prognosticator 

 

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