Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and around the world.
Oil reaches 11-month high
Oil has hit an 11-month high as the reflation trade also gathers pace.
Brent (BZ=F) gained 0.5% at around 10am in London on Wednesday, at $56.86 (£40.91) a barrel.
The standalone crude price (CL=F) was also higher, up 0.2% to $53.42 a barrel.
News of Saudi Arabia agreeing output cuts has helped spur on the rally. COVID-19 vaccine developments and the global immunisation effort that is underway has also made markets more confident that economies will open soon, with more people using gasoline-fueled transportation, such as cars and airplanes.
Britain’s ongoing lockdown is boosting profits at ASOS (ASC.L) despite rising costs, as the pandemic pushes more shopping online and leads to lower return rates.
ASOS said on Wednesday that ongoing restrictions to curb the spread of COVID-19 were likely to add net £40m ($54.7m) to its bottom line in the first half of 2021. The boost comes as more customers spend more online and return rates fall, ASOS said.
“The pandemic may have wreaked devastation on retailers with a large brick and mortar footprint, but it’s given ASOS, with its highly flexible e-commerce platform, another big shot of success,” said Susannah Streeter, a senior investment and markets analyst at Hargreaves Lansdown.
The surprise profit upgrade came as fast fashion retailer ASOS reported better-than-expected performance over Christmas and New Year.
Sales grew by 24% to £1.36bn in the four months to 31 December and ASOS added 1.1 million new customers over the period.
Strong rebound for Persimmon
The UK’s largest housebuilder, Persimmon (PSN.L), said it had “robust performance” in 2020 despite the impact of the coronavirus pandemic.
Still, revenue and new home competitions fell due to the closure of the housing market in the first UK lockdown.
The company reported on Wednesday that new home competitions reached 13,575 last year, down from 15,885 in 2019, with total group revenues falling from £3.65bn to £3.33bn.
It had £1.23bn in cash, up from £844m the previous year. The business’ current forward sales position is £1.68bn, compared with £1.35bn in 2019.
“The Group's strong second half completions were supported by its advanced build coming into the year, an agile and effective response to the Covid-19 pandemic and resilient customer demand,” said Dean Finch, group chief executive, in a trading update.
“Recent events have served to further demonstrate the continuing near term uncertainties arising from the Covid-19 pandemic,” he added.
Still, he maintained that the business was “confident” in its outlook and the wider UK housing market’s underlying fundamentals.
European stocks were muted on Wednesday as focus remains on surging COVID-19 cases and governments continue to rollout their vaccine campaigns.
Asian markets were largely in positive territory as they focused on the global economic recovery. While Japan’s Nikkei (^N225) gained 1% at market close, the Hong Kong Hang Seng (^HSI) fell 0.2%, and the Shanghai Composite (000001.SS) slid lower 0.3% at market close. South Korea’s KOSPI (^KS11) headed higher 0.7%.
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