Proactive Investors -
- FTSE 100 in the green, up 57 points
- First Citizens Bank buys most of SVB assets
- German business confidence improves in March
Retaiers more optimistic - CBI
The CBI’s monthly gauge of the retail sector shows that retailers have the first positive sales expectations since last September.
Its expected sales balance increased to +9 for April, up from -18 in March which brings to an end a run of negative sales expectations since last October.
Retail sales volumes were broadly unchanged in the year to March, according to the latest CBI #DTS. Retailers expect sales to grow at a moderate pace next month pic.twitter.com/g1Fof7ajw3— CBI Economics (@CBI_Economics) March 27, 2023
Sales in March were reported little changed at +1, similar to February’s reading of +2, as the cost of living squeeze continues to hit consumer spending.
CBI principal economist Martin Sartorius said it is “encouraging” that activity in the retail sector seems to be stabilising, after “a challenging winter.”
“This resilience has helped inspire some spring shoots of optimism, with firms expecting an increase in sales for the first time since last September,” he added.
Business still struggling to find staff
Most British businesses are struggling to plug gaps in their workforces amid a shortage of skilled talent.
About 80% of companies reported difficulty filling jobs, according to the latest talent shortage survey by recruitment firm, ManpowerGroup, the highest percentage since 2006, while the proportion of businesses reporting difficulties with recruitment has jumped from 13% a decade ago.
The pandemic has exacerbated the nation’s skills shortages, the survey showed; only 35% of businesses reported concerns about staffing in 2019.
Although the number of job vacancies in the UK has been coming down in recent months, there are still more than 1.1mln unfilled jobs across the country, 40% more than at the beginning of 2020.
“Talent shortages are always an area of concern for employers, but the real step change in our data can be seen post 2019,” Michael Stull, director at ManpowerGroup UK, said.
He added that employers were “acutely aware of the growing scarcity of key skills, so they’re holding on to and trying to stockpile business-critical talent.
First Republic shares soar in pre-market trading
Shares in First Republic have jumped nearly 25% in pre-market trading, after a report that an emergency lending facility for US banks could be expanded.
Earlier this month, a number of major Wall Street banks pledged to put US$30bn of deposits into First Republic, but that failed to stem concerns over the bank.
But Bloomberg has reported that “officials have yet to decide on what support they could provide First Republic, if any, and an expansion of the Federal Reserve’s offering is one of several options being weighed at this early stage.”
The move could give First Republic more time to bolster its health https://t.co/kM2xEb5dGg— Bloomberg (@business) March 26, 2023
“Regulators continue to grapple with two other failed lenders — Silicon Valley Bank and Signature Bank — that require more immediate attention.”
“Even short of that step, watchdogs see First Republic as stable enough to operate without any immediate intervention as the company and its advisers try to work out a deal to shore up its balance sheet, the people said, asking not to be named discussing confidential talks.”
HSBC investor forces vote on break-up
HSBC has been forced to give its shareholders a vote on a proposal by Hong Kong investors to require the bank to conduct a strategic overhaul, including a spin-off of the Asian business.
The vote was requested by Ken Lui, an investor who runs a group campaigning for a spin-off of the Asian arm.
The bank’s shareholders will also vote on another resolution he has tabled, calling for the bank to increase its dividends back to pre-Covid levels.
The Asian-focused lender has faced a year-long campaign, sparked by intervention from its largest shareholder, the Chinese insurer Ping An, to break off its Asian operations from the rest of the business, which employs more than 200,000 people in 64 countries.
It is not clear whether the Chinese insurer will use its 9% holding to back Lui, who has said that he had “not engaged with Ping An at all”.
In the notice to shareholders ahead of its AGM on 5 May, first reported by the Sunday Times, the board recommended that investors vote against an Asian spin-off, saying it had already considered “strategic reorganisation, and restructuring of the company’s Asia businesses” in 2022.
“The board concluded that all of these structural reforms would significantly dilute the economics of our international business model upon which our strategy is based,” it said. “This would result not only in a material loss of value for shareholders but also lower dividends.”
HSBC shares are now little changed after opening higher, up 0.1%. The FTSE 100 is up 39 points.