46 2GM Tuesday April 5 2022 | the times
BusinessMarkets
news in brief
Brady joins PR team
Declan Kelly, the public relations
adviser who quit the helm of
Teneo last year after sexual
harassment allegations, has
recruited the American football
star Tom Brady to his comeback
venture. Brady, who recently
announced he was retiring from
the sport before rescinding that
decision, has joined Kelly’s new
firm Consello as a partner,
according to the Financial Times.
Other partners named are Oscar
Salazar, the former chief
technology officer of Uber, and
Steve Mollenkopf, the former
chief executive of Qualcomm.German Gazprom move
Gazprom Germania, an energy
trading, storage and transmission
business ditched by Russia’s
Gazprom on Friday, will be
transferred to Germany’s
regulator to ensure energy
security, Robert Habeck, the
economy minister, said. The
move by Germany should ease
pressure on the UK arm of the
state-backed Russian group,
Gazprom Marketing & Trading,
which provides fuel to consumers
including factories, restaurants
and the NHS.Pawnbroker pays out
H&T has said it will refund
customers by more than
£2 million after a review of a
group of loans. The pawnbroker
said that it had looked into loans
between April 2014 and October
2019 and found 9,800 loans to
8,000 customers that should have
been refused. These make up
about 11.5 per cent of the total,
unsecured, high-cost, short-term
loans it made during the period.
These type of loans are no longer
sold by the group. On average,
each customer will get £264.Aviva hires female CFO
Aviva, the insurer, yesterday
appointed Charlotte Jones as its
next chief financial officer,
claiming it has become only the
second FTSE 100 company with
women in the top two posts.
Jones, who replaces Jason
Windsor, was previously finance
chief at RSA Insurance. She will
join Aviva, led by Amanda Blanc,
in September. It appointed
Andrea Montague as chief risk
officer last year. NatWest is the
only other FTSE 100 group with
two women heading the business.Commodities
ICIS pricing (London 7.30pm)Crude Oils ($/barrel FOB)
Brent Physical 108.72 +4.45
BFOE(Apr) 107.70 +3.14
BFOE(May) 106.17 +3.18
WTI(Apr) 101.84 +3.94
WTI(May) 100.60 +3.84Products ($/MT)Spot CIF NW Europe (prompt delivery)
Premium Unld 1041.00 1042.00 +22.00
Gasoil EEC 1127.00 1129.00 +47.25
3.5 Fuel Oil 596.00 600.00 +1.00
Naphtha 951.00 953.00 +22.00ICE Futures
Gas Oil
Apr 1124.75-1115.00 Jul 963.00-952.25
May 1056.00-1055.25 Aug 934.00-913.00
Jun 994.75-994.50 Volume: 565605Brent (9.00pm)
Jun 106.46-106.44 Sep 102.25-101.51
July 104.93-104.90 Oct 101.07-92.32
Aug 103.64-103.41 Volume: 1626400LIFFE
Cocoa
May 1741-1738 Jul 1800-1755
Jul 1769-1765 Sep 1800-1705
Sep 1777-1774 Dec 1785-1765
Dec 1782-1775
Mar 1790-1771
May 1829-1773 Volume: 66746RobustaCoffee
May 2125-2123 Jan 2280-2000
Jul 2116-2115 Mar 2117-1995
Sep 2120-2108
Nov 2117-2090 Volume: 17539White Sugar (FOB)
Reuters Dec 521.60-521.50
Mar 518.10-517.10
May 541.30-540.90 May 510.10-508.70
Aug 532.20-531.90 Aug 498.80-496.80
Oct 525.10-524.70 Volume: 59273PRICES
Major indices
New York
Dow Jones 34866.42 (+48.15)
Nasdaq Composite 14484.40 (+222.90)
S&P 500 4571.59 (+25.73)
Tokyo
Nikkei 225 27736.47 (+70.49)
Hong Kong
Hang Seng 22502.31 (+462.76)
Amsterdam
AEX Index 737.80 (+9.80)
Sydney
AO 7818.90 (+33.00)
Frankfurt
DAX 14518.16 (+71.68)
Singapore
Straits 3416.97 (-2.14)
Brussels
BEL20 4227.34 (+27.33)
Paris
CAC-40 6731.37 (+47.06)
Zurich
SMI Index 12340.87 (+161.79)
DJ Euro Stoxx 50 3956.59 (+37.91)
London
FTSE 100 7558.92 (+0.00)
FTSE 250 21329.89 (+0.00)
FTSE 350 4243.14 (+0.00)
FTSE Eurotop 100 3485.84 (+0.00)
FTSE All-Shares 4213.27 (+0.00)
FTSE Non Financials 5118.63 (+20.62)
techMARK 100 6159.41 (+0.00)
Bargains n/a
US$ 1.3110 (+0.0006)
Euro 1.1955 (+0.0091)
£:SDR 0.98 (+0.00)
Exchange Index 81.30 (+0.07)
Bank of England official close (4pm)
CPI 115.83 Feb (2015 = 100)
RPI 320.20 Feb (Jan 1987 = 100)
RPIX 290.10 Jun (Jan 1987 = 100)
Morningstar Long Commodity 677.16 (+5.72)
Morningstar Long/Short Commod4703.45 (+27.75)London Financial Futures
Period Open High Low Sett Vol Open Int
Long Gilt Jun 22 121.55 122.35 121.31 121.88 179460 676914
Sep 22 124.10 124.10 124.10 120.37 2 2
3-Mth Sterling Jun 22 99.025 99.045 99.015 99.026 10377 232459
Sep 22 98.885 98.890 98.860 98.866 3885 301735
Dec 22 98.820 98.825 98.790 98.806 7310 347378
Mar 23 98.785 98.795 98.755 98.771 8310 229855
Jun 23
3-Mth Euribor Jun 22 100.36 100.38 100.36 100.36 62910 496172
Sep 22 100.10 100.12 100.08 100.10 55203 446922
Dec 22 99.715 99.760 99.700 99.735 68922 495563
Mar 23 99.285 99.350 99.265 99.305 55305 435158
Jun 23 98.955 99.010 98.920 98.960 53439 387022
3-Mth Euroswiss Jun 22 100.71 100.72 100.70 100.71 925 29152
Sep 22 100.68 100.68 100.67 100.68 710 31355
Dec 22 100.61 100.62 100.59 100.62 488 22748
Mar 23
FTSE100 Jun 22 7502.5 7538.5 7487.0 7526.0 57834 572669
Sep 22 7441.0 7441.0 7441.0 7446.5 18 566
FTSEurofirst 80 Jun 22 5456.0
Sep 22 5444.5© 2022 Tradeweb Markets LLC. All rights reserved.
The Tradeweb FTSE Gilt Closing Prices information contained
herein is proprietary to Tradeweb; may not be copied or
re-distributed; is not warranted to be accurate, complete or timely; and does not constitute
investment advice. Tradeweb is not responsible for any loss or damage that might result
from the use of this information.The better news about BMO’s
retail and office weighting? It plays
into the shift towards more lowly-
rated, recovery stocks. The shares
have already gained almost a tenth
since the start of this year and 44
per cent since the end of 2020.
The scars of the pandemic are
not fully healed. The rent collection
rate during the final quarter of last
year was nearing pre-2020 levels
and at 93.9 per cent, stretching back
to when coronavirus restrictions
first came into effect. But monthly
dividends are yet to be restored to
the pre-pandemic level, when
payouts equated to 6p a share
annually.
In November the dividend wasShift further into prime industrial
and logistics assets, which accounted
for 30.6 per cent of the portfolio by
value, up from 19.1 per cent at the
end of 2020. It’s easy to see the
appeal of buying warehouses in light
of an acceleration in ecommerce and
urgency among companies to secure
their supply chains.
Industrial assets, the hottest corner
of the real estate market, have
helped pick up the slack from retail
and meant the trust managed a
3.9 per cent increase in net asset
value in the fourth quarter. But that
also means would-be buyers are
forced to stump up more to secure
assets from a pool being increasingly
eyed by large institutional investors.I
t didn’t take much imagination for
real estate investors to guess
which assets would weather the
pandemic upheaval the worst. A
combined weighting of almost half
the portfolio towards the already-
struggling retail sector and office
assets, a sector that has a question
mark hanging over when or if leasing
activity will fully recover, means
BMO Commercial Property still
trades at a 14 per cent discount to net
asset value at the end of December.
How to address that discount?Emma Powell Tempus
Buy, sell or hold: today’s best share tipsEdinburgh trust is a festival of stocks
T
he rally in beaten-up UK
stocks over the past 18
months means there have
been easy gains on offer
for investors. A skew
towards recovery plays has
amplified the gains made by
Edinburgh Investment Trust, which
over the two years to the end of
March generated a net asset value
of just over 55 per cent, versus the
44 per cent turned out by the FTSE
all-share.
That outperformance means
Edinburgh Investment Trust, which
for the past two years has been
attempting to win back investors
after a repeated weak performance
as part of the Invesco stable, has
helped narrow the discount attached
to the shares versus the NAV.
Edinburgh has now become the
only investment trust to be managed
by Liontrust, which has itself been
rapidly gathering assets, after the
fund management group acquired
rival Majedie. James de Uphaugh,
portfolio manager, hopes what he
calls Liontrust’s “distribution muscle”,
will narrow that discount further.
Top holdings that include the
energy giant Shell and the mining
group Anglo American have
propelled returns over the past two
years thanks to sharply rising
commodity prices, a tailwind that is
unlikely to dissipate in the comingmonths. But longer-term, the
question investors will naturally ask
is, what drives performance once the
extraordinary market conditions that
have boosted value stocks recedes?
The spike in energy prices aside, a
spate of takeover interest and activist
intervention in UK companies couldresult in more durable growth in
returns. Edinburgh has recently built
stakes in GlaxoSmithKline as well as
Unilever, which made a failed bid for
the former’s consumer healthcare
arm. There is also less exposure to
highly-rated tech stocks and other
blue-sky companies that have
suffered the worst sell-off as interest
rates have started to rise.
While the trust still has large
holdings in classic value stocks, the
list of top holdings has broadened to
include names that are rated more
for their growth characteristics,
including the equipment rental
business Ashtead and the industrial
distribution specialist
Electrocomponents. That shift inBetter balanced
Share priceSource: Refinitiv
Q12021 2022
Q2 Q3 Q4660p6406206005805606.54.94.54.094.03.83.63.63.52.7Top ten holdings (as % of assets)
ShellTescoAnglo AmericanAstraZenecaBAE SystemsUnileverNatWestAshteadWeirElectrocomponentsstrategy also meant cutting the
dividend to what the board viewed as
a more sustainable level, from 28.65p
in 2021 to 24p a share, still equivalent
to a yield of almost 3.8 per cent at
the current share price. That, plus
the overhang from a consistent,
historic record of underperformance,
means it is unsurprising the trust
trades at a wider discount than UK
equity income peers such as City of
London Investment Trust, which is
known for increasing the dividend
annually over the past 56 years.
The benefit of that cut? It gives the
trust more room to manoeuvre in
the companies it invests in, rather
than being dependent on a smaller
number of stocks, which could be
paying out high dividends at the
expense of reinvestment. Instead, the
trust focuses on total return, rather
than just the level of dividend it can
pay out, aiming to beat the FTSE
All-Share. Over the 12 months to the
end of March, it generated a total
NAV return of almost 25 per cent
and a share price return of 27.9 per
cent, against the 20.2 per cent
delivered by the index.
In September old expensive debt
will finally mature and is to be
replaced with debt that will cost over
5 percentage points less to service,
increasing the trust’s potential.
The trust now trades at a 7.7 per
cent discount to the NAV, narrowing
from a peak post-pandemic gap of
almost 15 per cent in September- But a broadening array of
stocks being backed by the trust
mean that could close further.
ADVICE Buy
WHY The shares offer a
decent dividend yield, as well
as more emphasis on capital
returns than most equity
income trustsincreased to 0.375p, equivalent to an
annual payment of 4.5p and a yield
of 3.9 per cent at the current share
price. The potential for a further
increase will be assessed as the trust
reinvests the surplus cash from
recent property sales, which last
year included a supermarket and
multi-let office building.
There is a good chance that the
best of the shares’ recovery gains
have already been banked.ADVICE Hold
WHY Chance of a better
dividend is thereedinburgh inv trust
Market cap
£1.09bnDividend yield
3.8%bmo commercial property
Dividend yield
3.7%Net asset value
per share 135p