Markets Today: Boohoo bounces but 'back to normal' is lurking around the corner

Was there a note of disbelief in the voice of Carol Welch, managing director of the Odeon Group in the UK when she told the BBC’s Today programme that people are desperate to come back to the cinemas? 

As the big screens ready themselves for the big reopening later this month, they are competing for the eyeballs of Brits who have been stuck to their Netflix, Amazon or Disney+ accounts for many months. Netflix numbers might not have lived up to expectations in last week’s results announcement, but there are still an incredibly impressive number of annual subscribers. The cinema industry may struggle to return to its pre-Covid existence. 

Big tech companies have certainly been major beneficiaries of the change in behaviour brought on by the virus, as demonstrated in the financial results which Lauren Almeida has analysed here. But how long can these companies continue climbing? To assess the future of Amazon, John Hughman has looked to its history with the help of Brad Stone’s award-winning book, The Everything Store. Read his article here.

There’s definitely something to be said about stock picking in the US large-cap space. Dave Baxter has been on the hunt for funds which have a knack of outperforming the notoriously tough-to-beat S&P 500 index and found that many of them are specialists in the biggest companies in the market. Find out how you can make the most of this information here.

Closer to home, a big lockdown winner has been Boohoo, which reported a 41 per cent increase in sales in its annual results this morning, spurred by demand for ‘athleisure’, or ‘lockdown outfits’. Boohoo’s strong online presence has served it well during the pandemic as retail shifts online. But questions still circle around the company’s environmental and social credentials after last year’s scandal and there remains uncertainty about the extent to which the company's recent acquisitions can be properly integrated. 

Virgin Money has also announced results this morning which carry a flavour of Covid. The company previously acknowledged the increase in bad loans during the pandemic which may have had an impact on the reliability of its profits. But this morning’s numbers suggest that the worst is over - the company has increased its margin guidance after taking fewer than expected impairments.

AbbVie, J&J and the burgeoning immunology market

Covid-19 has understandably topped the healthcare agenda in the past 15 months. But autoimmune conditions have been brought to the fore in recent days by a flurry of earnings reports on both sides of the Atlantic.

Diseases such as psoriasis, rheumatoid arthritis and ulcerative colitis are at once prevalent and typically long-term in nature, giving rise to a huge, multi-billion dollar immunology universe.

Leading the immunology charge is US pharma giant AbbVie (US:ABBV), which boasts the world’s top-selling drug and which posted Q1 results last week. But behemoth Johnson & Johnson (US:JnJ) is also a key market player, as are various biosimilar drugs biting into those companies’ revenues. Read our full analysis of the latest quarterly numbers here. HC

Facebook oversight board to decide on Trump ban

Facebook’s (US:FB) oversight board is expected to rule today on whether Donald Trump can return to its social media sites, after the company banned the former US President from both Facebook and Instagram in the wake of the Capitol Hill riots. 

Unfortunately for Facebook, whatever decision its board makes, it is likely to spark backlash. When Twitter (US:TWTR) permanently banned Trump in January, the company drew support from those concerned that the former President could incite further violence, as well as criticism from those who said it was an attack on free speech.

For Facebook, Twitter and the numerous other social media platforms that have suspended Trump, their decision could have financial as well as political implications. As Lauren Almeida wrote in a recent article: controversial political content sells.

But keeping the ban on Trump will not destroy Facebook’s business. As Lauren also pointed out, from “Baby Shark” to “Gangnam Style”, banal content tends to generate more clicks than controversial content.

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