Archived article
Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
The following is a summary of top news stories Tuesday.
----------
COMPANIES
----------
BP said it swung to a first-quarter loss due to its decision to exit from its shareholding in Rosneft in response to Moscow's invasion of Ukraine; however on an underlying basis, the oil major reported a big jump in profit. For the three months that ended March 31, BP swung to an attributable loss of $20.38 billion from a $4.67 billion profit in the first quarter last year. BP said the reported result included pretax adjusted items of $30.8 billion. The London-based firm attributed the loss to its decision to exit its 19.75% shareholding in state-owned Russian oil firm Rosneft. BP said that, in the first quarter, the total post-tax charge for this was $25.5 billion. However, on an underlying replacement cost basis, BP reported a profit of $6.25 billion, up 54% from $4.07 billion in the fourth quarter of last year and more than doubled from $2.63 billion a year ago. Turning to shareholder returns, BP raised its first-quarter dividend by 4.0% to 5.46 cents from 5.25 cents the year before. It also announced a further share buyback. BP said it plans to execute a $2.5 billion share buyback before announcing its second-quarter results.
----------
BNP Paribas reported a strong rise in revenue and profit in the first quarter on the back of the strength of its investment bank. In the three months to March 31, the Paris-headquartered bank recorded pretax income of €3.28 billion, up from €2.82 billion in the same period the year prior. Operating income increased to €3.11 billion from €2.34 billion. Revenue improved to €13.22 billion from €11.83 billion, with net interest income rising to €5.73 billion from €5.45 billion and net commission income up to €2.64 billion from €2.56 billion.
----------
Deutsche Post reported a sharp rise in revenue in the first quarter and has confirmed its growth target for 2022. In the three months to March 31, the Bonn-headquartered package delivery firm recorded net profit of €1.35 billion, rising from €1.19 billion in the same period the year prior. Revenue jumped to €22.59 billion from €18.86 billion. Deutsche Post said strong demand for transport services was continuing in spite of enduring capacity restraints. And although parcel volumes were slightly lower - due to decreased online trade - this was offset by its global logistics business, Deutsche Post said.
----------
Cyber security firm Avast reported a fall in first-quarter earnings due to sale of the Family Safety business in 2021. For the three months to March 31, revenue was down to $234.6 million from $237.1 million a year ago. Adjusted earnings before interest, tax, depreciation and amortisation was $127.9 million, down from $133.7 million. In March, Avast had said that it was suspending its operations in Russia and Belarus. Looking ahead, Avast expects low single-digit organic revenue growth and mid-single-digit billings growth for 2022. The antivirus software provider also said adjusted Ebitda margin for the year is expected to be slightly below 50%. This reflects 10 months with zero sales in Russia, the continued investment in various customer initiatives and increased customer acquisition costs, it explained. Avast said its profit forecast excludes any transaction costs related to its merger with NortonLifeLock. In late March, the UK Competition & Markets Authority said it will refer Avast's takeover by its US peer to a phase two investigation.
----------
Workers at an Amazon.com facility in New York rejected a unionization campaign, according to a vote count on Monday, one month after the group's upset triumph at a neighbouring warehouse. Sixty-two percent of workers at the Staten Island facility voted against the union push, with 618 employees voting no and 380 in support, according to results released by US officials. The election at LDJ5 followed on the heels of the upset win by the Amazon Labor Union on April 1 at the larger JFK8 Staten Island company site, which established the first Amazon union in the US. The April win stood as one of the biggest recent victories by organized labor, winning plaudits from President Joe Biden and other leading unions, some of which visited Staten Island ahead of the second vote. But the union acknowledged a setback in the latest campaign. ‘The count has finished. The election has concluded without the union being recognized,’ Amazon Labor Union said on Twitter. ‘The organizing will continue at this facility and beyond. The fight has just begun.’
----------
The EU accused Apple of blocking rivals from its popular ‘tap-as-you-go’ iPhone payment system, opening a fresh battlefront between the US tech giant and Brussels. ‘The preliminary conclusion that we reached today relates to mobile payments in shops, by excluding others from the game,’ said Margrethe Vestager, the EU's antitrust chief. ‘Apple has unfairly shielded its Apple Pay wallets from competition. If proven this behaviour would amount to abuse of a dominant position, which is illegal under our rules,’ Vestager told reporters. The European Commission, the bloc's competition watchdog, specifically charged the iPhone maker with preventing competitors trying to enter the contact-less market ‘from accessing the necessary hardware and software ... to the benefit of its own solution, Apple Pay’. The accusation is the latest salvo against US tech giants by EU regulators, who have also taken aim at Apple's music streaming and e-book businesses.
----------
MARKETS
----------
Most major stock markets were firm on Tuesday, though London's key index was slightly lower as the market reopened after a three-day weekend. Wall Street was called to open flat, after a positive day on Monday, particularly for the Nasdaq Composite. The two key events of the week ahead are interest rate decisions by the US Federal Reserve on Wednesday and the Bank of England on Thursday. Earlier Tuesday, Australia joined the tightened cycle started by central banks elsewhere.
----------
CAC 40: up 1.0% at 6,488.63
DAX 40: up 0.6% at 14,018.75
FTSE 100: down 0.4% at 7,513.14
----------
Hang Seng: closed up 0.1% at 21,101.89
Nikkei 225: Tokyo market closed for holiday
S&P/ASX 200: closed down 0.4% at 7,316.20
----------
DJIA: called marginally higher, up 5.00 points
S&P 500: called marginally higher, up 1.50 points
Nasdaq Composite: called marginally lower, down 1.25 points
----------
EUR: soft at $1.0498 ($1.0504)
GBP: up at $1.2530 ($1.2490)
USD: soft at JP¥130.12 (JP¥130.19)
GOLD: down at $1,854.90 per ounce ($1,861.64)
OIL (Brent): down at $106.30 a barrel ($108.09)
(currency and commodities changes since New York equities close on Monday)
----------
ECONOMICS AND GENERAL
----------
The Reserve Bank of Australia raised interest rates in an attempt to combat inflation that has ‘picked up more quickly’ than expected. The Sydney-based central bank raised the main lending rate by 25 basis points to 0.35%, the first increase since November 2010. ‘The board judged that now was the right time to begin withdrawing some of the extraordinary monetary support that was put in place to help the Australian economy during the pandemic,’ Governor Philip Lowe said. ‘The economy has proven to be resilient and inflation has picked up more quickly, and to a higher level, than was expected. There is also evidence that wages growth is picking up. Given this, and the very low level of interest rates, it is appropriate to start the process of normalising monetary conditions.’
----------
Unemployment in the eurozone fell in March, data from Eurostat showed, while industrial producer prices surged. In March, the euro area seasonally-adjusted unemployment rate was 6.8%, down from 6.9% in February 2022 and from 8.2% in March 2021. Market consensus, according to FXStreet, had seen unemployment at 6.7%. Meanwhile, industrial producer prices rose by 5.3% in the euro area and by 5.4% in the EU in March, compared with February. On a year before, industrial producer prices increased by 37% in both the euro area and the EU.
----------
Germany's employment level in March exceeded its pre-Covid level in February 2020 for the first time since the pandemic began, figures from Destatis showed. In March, compared with the previous month, the seasonally adjusted number of people in employment rose by 85,000, or 0.2%, following an average monthly increase of 58,000 people, or 0.1%, in the period from March 2021 to February 2022. The adjusted unemployment rate was 2.9%, reduced from 4.0% a year prior. In February, the adjusted unemployment rate stood at 3.0%.
----------
UK manufacturing sector activity edged higher on increased intakes of new business against a backdrop of rising price inflationary pressures, S&P Global said. The UK S&P Global-CIPS manufacturing purchasing managers' index was 55.8 points in April, up slightly from the preliminary estimate of 55.3 and the score of 55.2 registered in March. S&P said the start of the second quarter saw a mild growth acceleration in the UK manufacturing sector. The rate of expansion in output improved from March's five-month low, leading to a further solid increase in staffing levels.
----------
The EU warned member states to prepare for a possible complete breakdown in gas supplies from Russia, insisting it would not cede to Moscow's demand that imports be paid for in roubles. The European Commission will on Tuesday propose to member states a new package of sanctions to punish President Vladimir Putin's Kremlin for its invasion of Ukraine, including an embargo on Russian oil, officials said. But energy and environment ministers meeting in Brussels on Monday addressed the larger and potentially more complicated issue of Russia's natural gas, upon which several countries including EU top economy Germany depend for much of their power generation. Moscow has demanded clients from ‘unfriendly countries’ including EU member states pay for gas in rubles, a way to sidestep Western financial sanctions against its central bank. It has cut off Bulgaria and Poland after their firms refused to comply. After the talks, the French chair of the meeting, ecological transition minister Barbara Pompili, and the European commissioner for energy, Kadri Simson, said the 27 member states were united with Poland and Bulgaria and would stockpile gas to be prepare for a breakdown.
----------
Fighting raged in the critical port city of Odessa and across Ukraine's east as fresh evacuations of civilians from war-ravaged Mariupol were expected Tuesday. Russia's Foreign Minister Sergei Lavrov meanwhile sparked outrage by alleging Adolf Hitler may have ‘had Jewish blood’, invoking a conspiracy theory in a bid to discredit Ukraine's President Volodymyr Zelensky who is of Jewish ancestry. Zelensky also slammed Lavrov's remarks as ‘anti-Semitic’, and said they showed Russia had ‘forgotten all the lessons of World War II’. ‘It is no coincidence that they are waging a so-called total war to destroy all living things, after which only the burned ruins of entire cities and villages remain,’ he added. The war has seen Moscow, after failing to take the capital Kyiv, shift its two-month-old invasion to largely Russian-speaking areas and step up pressure on Odessa, a cultural hub that is a crucial port on the Black Sea.
----------
Italy will add €14 billion of extra aid to help companies and consumers hit by surging energy prices, Prime Minister Mario Draghi said on Monday. ‘If one adds this 14 billion to the 15.5 billion already set aside, one arrives at a total of nearly 30 billion,’ he said. Energy prices have spiralled, exacerbated by the prospect of reduced gas flows from Russia following its invasion of Ukraine.
----------
The Supreme Court is poised to strike down the right to abortion in the US, according to a leaked draft of a majority opinion that would shred nearly 50 years of constitutional protections. The draft opinion was written by Justice Samuel Alito and has been circulating inside the conservative-dominated court since February, the news outlet Politico reported. The leak of a draft opinion while a case is still pending is an extraordinary breach of Supreme Court secrecy. The 98-page draft majority opinion calls the landmark 1973 Roe v. Wade decision enshrining the right to abortion ‘egregiously wrong from the start.’ ‘We hold that Roe and Casey must be overruled,’ Alito writes in the document, labeled as the ‘Opinion of the Court’ and published on Politico's website. ‘It is time to heed the Constitution and return the issue of abortion to the people's elected representatives.’ In Roe v. Wade, the nation's highest court held that access to abortion is a woman's constitutional right. In a 1992 ruling, Planned Parenthood v. Casey, the court guaranteed a woman's right to an abortion until the fetus is viable outside the womb, which is typically around 22 to 24 weeks of gestation.
----------
Copyright 2022 Alliance News Limited. All Rights Reserved.