Markets Today: 'Pingdemic' threat to business, Ocado fire & more

‘Pingdemic’ latest threat to businesses

On Saturday at the Open Golf tournament in Kent, one member of Hawkeye’s camera monitoring team tested positive for Covid-19. Despite protocols in place to prevent a mass exodus of staff and the pleas of the Open organisers to keep some operators on site, all eight team members were sent home by the company and Hawkeye was forced to deliver the remainder of its weekend monitoring remotely. 

That same evening the Metropolitan line - which connects Chesham and Amersham (of by-election drama) to Aldgate - was shut along its entire length because too many members of staff had been ‘pinged’ by the NHS covid app and told to isolate. 

Companies are now expressing concerns that the excessive caution of the NHS app might harm their fortunes, just when the UK is supposed to be opening up. Nissan and Rolls Royce (RR) were forced to shut parts of their factories last week. Green King has said that some pubs have had to close due to lack of staff. Supermarkets including Marks and Spencer (MKS) are warning of reduced operating hours. 

It is true, there are a lot of cases of Covid-19 in the UK right now. With over 48,000 new positive tests daily, numbers are creeping back to winter’s highs. But the death rate remains flat: a testament to the uptake and efficacy of the vaccine and greater efficiency of the health service. 

Another Ocado fire

Ocado (OCDO) shares slipped 3 per cent in early trade as investors assessed the impact that a fire at one its fulfilment centres will have. There is the immediate operational impact at Erith with orders being cancelled following the blaze, which was caused by a three-robot crash. There is reputational risk from cancelling swathes of orders – small I’d say – but nonetheless to be considered. But the main thing investors are concerned about is the safety of the technology – will this be repeated? It is only two years since the Andover facility burned down. Will this impact on future deals with international partners?

Read more from Neil Wilson of Markets.com in this morning’s trader column. 

S4 tops up acquisition fuel 

Advertising group S4 Capital (SFOR: Buy) has refinanced existing term loans and multi-currency revolving credit facilities (RCFs) with a seven year €375m senior secured term loan, on top of a five year multicurrency RCF worth £100m. This new support should help Sir Martin Sorrell, who leads the company as its executive chairman, continue with his aggressive acquisition strategy. 

The group noted that its trading activity had continued at “unprecedented levels” in May and June, although it did not provide any specific detail. LA