Slightly disappointing economic data from the UK has dampened expectations of a rate rise in May and sent Sterling lower, giving a lift to shares in London. Click here for The Trader Nicole Elliott's latest thoughts.
IC TIP UPDATES:
Shares in small cap recruiter Harvey Nash (HVN) are up 6 per cent this morning after the group announced a 24 per cent jump in adjusted pre tax profit. The group went against the grain in the UK, with gross profit rising 7.2 per cent in the region despite uncertainty over Brexit. It has been a big year for the group, carrying out a transformation programme and making acquisitions, which together had a massive impact on cash generation. Net cash generation from operations was £0.5m, down from £15.1m last year. Buy.
A 23 per cent increase in first quarter like-for-like revenues at Computacenter (CCC) is better than management had previously expected, sending shares up 3 per cent in early trading. The supply chain side of the business is what has driven most of that growth, where demand has been high, particularly in the UK. While shares continue to climb, Computacenter still looks decent value compared to its software services peers. Buy
KEY STORIES:
Shares in RBS (RBS) dipped by 2 per cent despite the bank more than tripling first quarter profits to £792m with operating profits topping £1.2bn. Crucially self help actions appear to be gaining traction with operating costs down by 18 per cent against last year. But plans to return to dividend payments remain beholden to news on a likely fine coming from the US in relation to mis-selling mortgage backed securities in the run up to the financial crisis and until this cloud is lifted shares are likely to struggle for traction.
OTHER COMPANY NEWS:
As expected, poor weather and an early Easter had a negative impact on Merlin Entertainments (MERL) - attraction and theme park owner. But trading has been robust in the first few months of 2018, giving investors a little confidence after a tough few months. Refinancing of the group’s banking facilities is also good news.
