Shares across London's main indices have regained some of yesterday's brutal losses but sentiment remains fragile. Our Trader writer Neil Wilson says: 'It’s been wild in Asia overnight. We saw a massive short squeeze blow out in Australia, with the ASX closing up 4.4 per cent having earlier dropped 8 per cent, after the RBA pumped $5.6bn into the system.
Broadly though Asian markets fell again, taking the cue from a brutal day on Wall St and Europe that was the worst since 1987. Tokyo fell 6 per cent, while Hong Kong fell 3 per cent. Thailand and India triggered their -10 per cent circuit breakers.
European markets are trying to bounce very hard today. Airlines are back up, with IAG leading the way with a 7 per cent rally at the open. The FTSE jumped 5 per cent to 5,500, before handing back a chunk of gains to trade up around 2 per cent. Meanwhile the DAX in Frankfurt rose 2.5 per cent to 9,400, before easing back to trade up just 1 per cent. There is not much conviction in this rally, I smell a dead feline again. Travel & Leisure was in the red by 08:30 – the weakest link is the first to break.' For Neil's full round up click here.
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Saga (SAGA) has said profits from its cruise operations will be £15m to £20m lower this year, after the retirement product specialist suspended cruise operations until May. The group made the decision following government guidelines advising against travel for people with pre-existing conditions or those aged 70 and over. While cancellations had apparently increased in recent weeks, the average load factor for the remaining five cruise departures scheduled for March was 79 per cent, and 85 per cent of travellers were still planning on travelling in April.
Premier Oil (PMO) has said it remains financially viable despite the crash in the oil price and its valuation, after its largest lender said it would see a major decline in cash flow this year. The company’s share price fell from over 100p last month to 13p this week, but rebounded almost 30 per cent this morning on a trading update which said 30 per cent of its 2020 production was hedged at $60 (£48) per barrel (bbl) oil equivalent. Additionally, Premier said the court meeting to decide on its North Sea acquisitions - funded by a planned $500m equity raise and debt of $300m - would go ahead on Tuesday. Asia Research & Capital Management, which has opposed the deal from the beginning, said Premier should be “protecting the balance sheet as a matter of priority”. Premier said it had cash of $35m and undrawn facilities of $330m at the end of February.
Codemasters (CDM) notes Universal Pictures’ decision to delay the release of the next film in the Fast and Furious franchise by 11 months, having originally scheduled the launch of a licensed computer game alongside the release date. While the game’s launch date is now uncertain, the group does not expect a delayed release to have a material impact on its 2021 financial expectations.
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Against a subdued backdrop, Eurocell (ECEL) grew sales by 10 per cent in 2019 to £279m while adjusted cash profits rose 5 per cent to £31.7m. The gross margin improved by 1.7 percentage points to 51.2 per cent as the group implemented selling price increases to recover material cost inflation and upped its usage of cheaper recycled PVC. Recycled material now accounts for 23 per cent of material consumption, up from 17 per cent in 2018. Capital expenditure was 7 per cent higher during the year at £15.2m as it invested to increase manufacturing and recycling capacity. Still, excluding £43m in lease liabilities, net debt has come down 11 per cent to £34.6m. Buy.
