(Alliance News) - The following is a summary of top news stories Thursday.
----------
COMPANIES
----------
Shell said it will book an impairment of between USD4 billion and USD5 billion in the first quarter of 2022 after exiting its operations in Russia. "These charges are expected to be identified and therefore will not impact adjusted earnings. Details of the accounting treatment and impact of ongoing developments will be provided at the first quarter 2022 results announcement," the energy major said. The firm last month said it would withdraw from involvement in all Russian hydrocarbons, including crude oil, petroleum products, gas and liquefied natural gas, following Russia's attack on Ukraine. The London-based oil and gas company said the withdrawal would be done in a "phased manner" in alignment with new government guidance. In addition, Shell on Thursday said operating cash flow is expected to be hurt by "very significant" working capital outflows, as price increases impacting inventory have led to a cash outflow of around USD7 billion.
----------
Russia's state communications watchdog said it would ban US internet giant Google from advertising its services in the country, accusing YouTube of spreading "fake news" about its military campaign in Ukraine. Russia has moved to block access to non-state media and information resources and fears are mounting that Alphabet's Google could be next in line for a ban. The watchdog said Google-owned YouTube had committed "numerous violations" of Russian legislation and was "one of the key platforms, distributing fake news about the course of the special military operation in Ukraine, discrediting the armed forces of Russia". It said it had decided to "introduce measures of coercion". It said these included "a ban on distribution of advertising for Google LLC and its information resources". The watchdog has already limited access to Google News app and website and accused Google of being "anti-Russian".
----------
Berkshire Hathaway has boosted its stake in HP, according to a regulatory filing on Wednesday, sending shares in the technology firm surging. Warren Buffet's Omaha, Nebraska-based insurance and industrial conglomerate now owns just over an 11% stake in HP. Berkshire Hathaway added to its HP stake by buying just shy of USD400 million worth of shares, Wednesday's regulatory filing said. The transactions occurred earlier this week. It now owns roughly 121 million HP shares. In March, the company said it signed a definitive agreement to acquire New York City-based insurance investment group Alleghany Corp for USD11.6 billion.
----------
Samsung Electronics expects profit for the first quarter to rise 50%, the South Korean tech firm said in a statement, despite global supply chain woes. The world's biggest smartphone maker forecast 2022 first-quarter operating profits of about KRW14.1 trillion, about USD11.6 billion, up from KRW9.4 trillion in the same quarter last year. Samsung did not provide details on the performance of its various divisions. The company is expected to release its full results on April 28. Analysts said the forecast was likely driven by strong smartphone sales, but warned of an expected drop in profits in the memory chip division. "Price decline in memory chips will be contained on the back of stronger than expected demand," Kim Un-ho, an analyst at IBK Investment & Securities, said in a report.
----------
Seven & I Holdings Co said its annual earnings spiked and the retailer expects slower, but still robust, revenue growth for the new financial year. In the year ended February 28, revenue from operations rose 52% to JPY8.750 trillion, about USD70.70 billion, from JPY5.767 trillion. The retail group - headquartered in Tokyo and owner of the 7-Eleven brand - posted pretax profit of JPY311.85 billion, up 21% from JPY258.78 trillion. Net income rose 15% to JPY223.24 billion, while net income attributable to owners of parent was 18% higher at JPY210.77 billion. Operating income was 5.8% higher at JPY387.65 billion. Looking to financial 2023, it expects to lift its dividend further by 3.0% to JPY103. It expects annual revenue to jump 10% to JPY9.653 billion. Operating income is tipped to rise 11% to JPY430.00 billion, with net income attributable to owners of parent forecast to rise 13% to JPY240.00 billion.
----------
Entain said it made a strong start to the year with a good performance across all areas of the business and is confident in its financial performance for the year ahead. For the three months to March 31, net gaming revenue was up 31% compared to the first quarter of last year, supported by the easing of Covid-19 restrictions. The London-based sports betting and gambling firm said that volumes in its in-store Retail arm were within 5% to 10% of pre-Covid-19 levels. The Ladbrokes-owner added that it was benefitting from continued momentum in all markets, excluding Germany and the Netherlands, and broadened its customer base in the period with actives up 34% over two years. However, its first-quarter online net gaming revenue was down 8% on an annual basis, though it said this was in line with expectations given a strong 2021 comparator.
----------
888 Holdings confirmed it will conduct an accelerated bookbuild to fund the acquisition of William Hill's non-US operations, also adding the purchase price of the deal has been cut. The Gibraltar-based online betting and gaming company said it will conduct a non-pre-emptive placing of up to 70.8 million new ordinary shares to start immediately. The placing price for the shares will be determined after the process closes, 888 explained. The new shares represent around 19% of its issued capital. At current market prices, the fundraise will be worth GBP175.9 million. 888 said the placing replaces its previous intention to raise around GBP500 million in the issue of new equity. An accelerated bookbuild is a quicker option to raise the necessary funds for the acquisition of William Hill assets, 888 explained.
----------
Irish Minister of Finance Paschal Donohoe announced a further extension of Bank of Ireland Group's share trading plan. In June 2021, the Irish government first announced its intention to sell some of its stake in the bank, initially over the next six months from the announcement. The Irish state owned around 150.4 million shares, reflecting just under a 14% stake, with the sales arranged by Citigroup Global Markets. The Irish bank has already completed phase two of the trading plan, with shares being sold by the government at a price of EUR5.64 each, achieving EUR283 million in proceeds. This brought the total proceeds from the trading plan to EUR532 million. The government's stake in the bank has now dropped to less than 5% from just under 14% in June. The further extension means that phase three will end no later than October 18.
----------
MARKETS
----------
European markets climbed cautiously higher on Thursday as investors mulled a hawkish set of meeting minutes from the US Federal Reserve. London's FTSE 100 lagged the bunch, weighed down by ex-dividend stocks and Shell's Russia impairment news.
Wall Street is on track for a modestly higher start after bearing the brunt of the Fed minutes on Wednesday, with the Nasdaq Composite ending down 2.2%. "Even though it was widely expected that the Federal Reserve minutes would confirm that the door was open to more aggressive monetary tightening if appropriate, the confirmation was enough to unsettle investors," said Richard Hunter, head of markets at Interactive Investor.
----------
CAC 40: up 0.6% at 6,540.05
DAX 40: up 0.5% at 14,227.47
FTSE 100: down 3.00 points at 7,584.70
----------
Hang Seng: closed down 1.2% at 21,808.98
Nikkei 225: closed down 1.7% at 26,888.57
S&P/ASX 200: closed down 0.6% at 7,442.80
----------
DJIA: called up 0.1%
S&P 500: called up 0.3%
Nasdaq Composite: called up 0.5%
----------
EUR: down at USD1.0897 (USD1.0906)
GBP: firm at USD1.3077 (USD1.3073)
USD: down at JPY123.71 (JPY123.77)
GOLD: flat at USD1,927.82 per ounce (USD1,927.10)
OIL (Brent): down at USD102.35 a barrel (USD104.01)
(currency and commodities changes since previous London equities close)
----------
ECONOMICS AND GENERAL
----------
Ukraine's foreign minister has appealed for help from the West as the country faces a battle for its industrial eastern regions after Russian forces withdrew from the outskirts of Kyiv to regroup. Authorities urged people to immediately evacuate from the Donbas region before Russia intensifies its offensive. In Brussels, Dmytro Kuleba urged Nato to provide more weapons for his war-torn country to help prevent further atrocities like those reported in the city of Bucha. "My agenda is very simple… it's weapons, weapons and weapons," Kuleba said as he arrived at Nato headquarters on Thursday for talks with the military organisation's foreign ministers. "We know how to fight. We know how to win. But without sustainable and sufficient supplies requested by Ukraine, these wins will be accompanied by enormous sacrifices," Kuleba said. Nato Secretary-General Jens Stoltenberg urged members to provide more weapons and not just defensive arms.
----------
The US Federal Reserve confirmed that it is looking to tighten its monetary policy, the minutes from its most recent Federal Open Market Committee showed Wednesday, and strongly considered a 50 point rise in March. At their March policy meeting, several Fed officials supported raising interest rates by half a percentage point in the future to combat inflation, the meeting minutes highlighted. The US central bank raised the federal funds rate range to 0.25% to 0.50% at its March 16 meeting. Eight of the Federal Open Market Committee members backed the hike. James Bullard preferred a chunkier rate rise to the range of 0.50% to 0.75%. "Many participants noted that - with inflation well above the Committee's objective, inflationary risks to the upside, and the federal funds rate well below participants' estimates of its longer-run level - they would have preferred a 50 basis point increase in the target range for the federal funds rate at this meeting" according to minutes from the Federal Open Market Committee's March gathering.
----------
Rich countries will tap an additional 120 million barrels of oil from emergency reserves in a bid to calm crude prices that have soared following Russia's invasion of Ukraine, the International Energy Agency said on Wednesday. The move includes 60 million barrels to be released by the US, which has recently announced it would tap its strategic oil reserves. The IEA "is moving ahead with a collective oil stock release of 120 million barrels (including 60 million barrels contributed by the US as part of its overall draw from its Strategic Petroleum Reserve)", IEA Executive Director Fatih Birol said in a tweet. Last week, US President Joe Biden announced a record release of US oil onto the market – one million barrels every day for six months, or a total of more than 180 million barrels.
----------
Eurozone retail sales figures presented a mixed picture, with the monthly rise in February falling short of expectations but the annual hike topping market forecasts. According to Eurostat, the single currency bloc's retail sales rose 0.3% on a monthly basis in February, quickening from a 0.2% hike in January but falling short of FXStreet-cited consensus of a 0.6% growth. Annually, retail sales rose 5.0% in the eurozone in February, slowing from January's 8.4% rise but bettering market forecasts of a 4.8% hike. "In the euro area in February 2022, compared with January 2022, the volume of retail trade increased by 3.2% for automotive fuels, and by 0.8% for non-food products, while it fell by 0.5% for food, drinks and tobacco," Eurostat said.
----------
Germany's industrial sector defied market forecasts and saw monthly production growth in February, figures showed. According to Destatis, industrial production rose 0.2% on a monthly basis, following a 1.4% hike in January. FXStreet-cited consensus had forecast output in February to be flat on a monthly basis, so the figure topped expectations. On an annual basis, production rose 3.2% in February, picking up speed from a 1.1% rise in January. Output remains below pre-pandemic levels, however. Destatis said: "Compared with February 2020, the month before restrictions were imposed due to the Covid-19 pandemic in Germany, production in February 2022 was 3.8% lower in seasonally and calendar adjusted terms. This gap in production is likely to be due to the continuing shortage of intermediate products, because of which many enterprises have problems completing new orders."
----------
Switzerland's jobless rate fell in March, figures showed. According to the State Secretariat for Economic Affairs, the Swiss unemployment rate fell to 2.4% in March, from 2.5% in February. The jobless rate had hovered between 2.5% and 2.6% every month since September. It had fallen to 2.5% in October, was unchanged in November, before rising to 2.6% in December, a threshold it stayed at in January, before the decline in February. On a seasonally-adjusted basis, the unemployment rate fell to 2.2% in March, from 2.3% in February.
----------
UK house prices surged to fresh record highs in March and have risen for the ninth month in a row, according to mortgage lender Halifax. On an annual basis, the Halifax UK house price index rose by 11% in March, slowing slightly from a revised 11.2% increase in February. The house price index increased 1.4% in March month-on-month, quickening from a 0.8% rise in February. The average price for a home in the UK stood at a fresh record high of GBP282,753 in March, up from GBP254,640 at the same time last year. Russell Galley, managing director at Halifax, said: "The story behind such strong house price inflation remains unchanged: limited supply and strong demand, despite the prospect of increasing pressure on households' finances. Although there is some recent evidence of more homes coming onto the market, the fundamental issue remains that too many buyers are chasing too few properties.
----------
By Lucy Heming; lucyheming@alliancenews.com
Copyright 2022 Alliance News Limited. All Rights Reserved.
