Overview of TOP weekly news 31.3.2021

31 / 03 / 2021
Trading is risky and your entire investment may be at risk

Fidelity International’s outlook for 2021

According to the Fidelity report, we can expect a widening gap between regional disparities in the future. The main reason is the progress of vaccination in various locations around the world.*

The report also touches on the world’s largest economy and views on state incentives. Nearly half of Fidelity International analysts predict that fiscal policy will be positive for companies this year in net. However, the result may be partially obscured, as higher government spending may be followed by tax increases.*

The scenario in Europe for 2021 is also positive. Analysts expect that despite the spread of coronavirus mutations, which could significantly slow economic activity in many sectors, the second half of 2021 should be much more positive.

Vaccination in the UK has helped

According to the latest official data released, the British economy is recovering from a coronavirus pandemic faster than originally expected. GDP grew by 1.3% in the last quarter of 2020 (October-December). This figure was 0.3% higher than originally expected by the Office for National Statistics. In 2020, the UK’s gross domestic product fell by 9.8%, compared to the original estimate of a fall of 9.9%, which was the largest drop in more than three centuries.

The Organization for Economic Co-operation and Development of the Acquired Member States (OECD) considered that the British economy had experienced the largest drop in GDP last year of all OECD countries except Argentina and Spain.

Britain is dependent on financial flows from abroad and the current exit from the EU will cause a deficit and reduce investor interest. The inflow of foreign investment, according to a Reuters survey, was forecast at £33 billion.

Cartel agreement

Mastercard, Allpay, APS, PFS and Sulion in the United Kingdom have entered into a secret cartel agreement with each other not to compete and steal clients on prepaid cards used by local authorities to pay social security benefits to the homeless, victims of domestic violence and asylum seekers.

Mastercard, Allpay and PFS have pleaded guilty if the regulator evaluates their behaviour illegally, they are willing to pay maximum fines totalling more than £32 million.

“Prepaid card services such as these can provide significant benefits to local authorities and one way to pay benefits to claimants who are the most vulnerable people in society,” said Chris Hemsley, CEO of PSR.

Disappointing of IPO Deliveroo

Deliveroo saw a 22% drop on the first day traded on the London Stock Exchange.[1]  The reason for the fall of the largest IPO in Europe this year is concern about the company’s profitability.

Performance of Deliveroo’s shares (Source of the graph: Tradingview) [3]  

Quarterly results at a loss

Swedish clothing retailer H&M published the financial results for the period December – February. As expected, the company reported a loss and, based on this, will not propose to pay dividends at the forthcoming annual general meeting. The pre-tax loss in the fiscal first quarter was $159.0 million.

Performance of H&M’s shares (Source of the graph: Tradingview) [4]

Watch this week:

Thursday, April 1, 2021

China publishes Caixin Manufacturing PMI Index. It is expected to grow from the last 50.9 to 51.3 points in March. *

Germany will publish the development of retail sales. Analysts expect 2% growth on a month-on-month basis in February. *

Friday, April 2, 2021

The United States will publish the unemployment rate in March. Analysts expect a decline to 6% from 6.2% in February. *

Source of the text: Investing, Zerohedge, Financial Times, Reuters, Tradingview

[1,3,4] Past performance is no guarantee of future results

*     Forward-looking statements are based on assumptions and current expectations, which may be inaccurate, or based on the current economic environment which is subject to change. Such statements are not guaranteeing future performance. They involve risks and other uncertainties which are difficult to predict. Results could differ materially from those expressed or implied in any forward-looking statements.

Disclaimer: The content of the Reports constitutes Marketing Communication and does not constitute Investment Advice or Investment Research or an offer for any transactions in financial instrument. The content of the Reports represents the view of our experts on a generic basis, and does not take into consideration individual readers personal circumstances, investment experience or current financial situation. In addition, the Reports have not been prepared in accordance with legal requirements designed to promote the independence of Investment Research, and are not subject to any prohibition on dealing ahead of the dissemination of Investment Research. Readers using the Reports should consider the possibility of encountering substantial losses. The past performance is not a guarantee of future results. Therefore, Goldenburg Group Limited shall not accept any responsibility for any losses of traders due to the use and the content of its Reports.