Friday Email: 22 November 2013
Every Friday morning our lead analyst Mark Riding sends out his weekly run-down and upcoming events in the investor calendar, like this one:
The UK stock market has spent most of the week trying to go down in the morning and being bolstered by the very strong US market in the afternoon. The Americans are currently seeing the UK and Europe as recovery plays and there is plenty of US money pouring into UK blue chip stocks. That was a pretty good week on the dividend front with Easyjet producing very strong numbers indeed and increasing its full year dividend by 59% and paying a special dividend into the bargain. Decent increases also came from Aveva, Diploma, Halma, Johnson Matthey, Paypoint and MITIE. Big Yellow implemented its new dividend policy with a 60% rise at the interim stage. Aberdeen Asset Management came to the party with a 39% increase in their full year dividend. Two more big rises came from Qinetiq and Telecom Plus with 27% and 23% respectively.
The week ahead is equally busy as the week just passed and many investors will be keen to see how Royal Mail are doing on Wednesday and they will no doubt declare their maiden dividend. Previous Dividends of the week Caledonia Investments and KCOM report this week.
So, it is difficult to fight the wave of US money that has seen the DOW move through 16000 yeaterday to another all time high. This looks to be the way the UK indices are going to move over the coming weeks as the smaller cap indices are dragged up by US buying of the big blue chips in the FTSE 100.
We see difficulties in the markets next year, but for the time being, the momentum continues.
The Friday email is delivered to over 20,000 subscriber’s every week, and remains a widely read run-down of recent events and what investors can expect in the week ahead written by our chief analyst Mark Riding.
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Read next: 15 November 2013
That was a busy week as things got active in the corporate world with plenty of results and Interim Management Statements. The FTSE 100 fell from 6722 to 6666 from Monday to Thursday of this week. Today brings results from Vedanta which will take some sorting out due to the mergers that have occurred. Yesterday saw Serco fall on a profit warning that was not overly dramatic, but the city took it very badly and hit the shares hard. Essentially, profits will be flat this year and next. We cannot be sure what will happen to the dividend policy which was to reduce cover from the current high level. I doubt very much that they will reduce the dividend and if they maintain their profitability at around current levels and reduce cover as promised then dividend increases can be expected. A return to bottom line growth should be possible in the 2015 financial year. Definitely one to put on your watch list.
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