Markets Defused is an easy-to-understand and straightforward recap of the day’s most engaging business and stock market news.
- Natwest had impressive results … here’s what the market said
- 3M stock spiked higher on earnings ‘beat’
- Rightmove boss wants an interest rate cut to stimulate market
- Drax was boosted by a jump in first half profit
- Natwest closed the week strong, thanks to upbeat financials
Natwest had impressive results … here’s what the market said
NatWest Group PLC (LSE:NWG) quarterly results were roundly cheered on Friday, with the banking share finishing the session at 361.9p, up just over 7% for the day.
Generally speaking, analysts praised the impressive earnings, improved margins, and strategic deal making.
Now, here, we curate the most engaging and insightful comments from some of the City of London’s talking heads.
3M stock spiked higher on earnings ‘beat’
3M Co (NYSE:MMM) shares soared on Friday, rising around 19%, driven by better-than-expected second-quarter results.
Revenue for the quarter amounted to $6.3 billion, easily exceeding the consensus Wall Street forecast of $5.85 billion.
Earnings per share similarly beat estimates comfortably, at $1.93 versus $1.68.
Looking ahead, guidance for the full year was upgraded lifting the estimated EPS range to $7.00 to $7.30, up from the previous range of $6.80 to $7.30.
It was the first set of financials under new chief executive Bill Brown, who took the role in early May.
Under Brown, 3M is aiming to streamline operations and it is accelerating new product development.
“I am focused on three priorities: driving sustained organic revenue growth, increasing operational performance, and effectively deploying capital,” Brown said.
“I have long admired 3M’s track record of innovation and am excited to be leading this great company and by the opportunities ahead.”
In New York, 3M shares were up $19.78 or 19.13% changing hands at $123.17.
Rightmove boss is hoping for interest rate cut to stimulate market
Rightmove PLC (LSE:RMV) shares fell on Friday, losing 1.4%, after its quarterly results showed growth for the first half, but, also suggested a need for stimulus in the shape of an interest rate cut.
Revenue was up 7%, reaching £192 million, supported by an increased in ‘revenue per advertiser’, and operating profit rose by 1.8% to £132.6 million. Rightmove's interim dividend increased by 3% to 3.7p.
Rightmove said it maintained its market share at 86%, despite competitive pressures from rivals like CoStar.
The company highlighted the need for interest rate cuts to ease mortgage challenges.
"Our performance came against the backdrop of the sustained challenging mortgage rate environment,” said chief executive Johan Svanstrom.
“With the election now concluded, the property market looks forward to potential interest rate reductions which will further stimulate activity.”
Full-year guidance remains unchanged, with anticipated revenue growth of 7-9% and membership growth of up to 2%.
In London, Rightmove shares fell 8p or 1.4% closing the week at 560p.
Drax was boosted by a jump in first half profit
Shares in Drax Group (LSE:DRX) advanced strongly and finished Friday 13.67% higher, thanks to strong first-half financial results.
The power station operator’s profits were up significantly, and, it told investors that it now expects full-year earnings to be at the top end of market forecasts.
Drax also announced a £300 million share buyback and lifted its dividend by 13%.
Also, it said it generated £393 million in biomass subsidies, and produced 2 million tonnes of pellets in the first half, slightly up from last year. The company is planning a £4 billion investment by 2030, with more investments likely in the following decade.
In London, Drax was up 77.46p or 13.67% closing the session at 643.96p.
Natwest closed the week strong, thanks to upbeat financials
NatWest Group PLC (LSE:NWG) shares strengthened, to close Friday’s session 7% higher, after a positive showing in its first half results.
The UK lender reported an operating profit of £3 billion – albeit, pre-tax profit was down 4.1% at £1.7 billion.
Additionally, Natwest announced the acquisition of a £2.4 billion mortgage book from Metro Bank adding to a recent deal to acquire Sainsbury's Bank accounts, adding about one million accounts.
It also revealed it had incurred £24 million in costs from an abandoned campaign, initially planned by the previous government, designed to privatize a portion of NatWest’s state-owned shares but was halted due to the early election call.
The government’s divestments of its holding in Natwest resumed following the election.
NatWest also upgraded its full-year profit forecast, expecting a return on tangible equity to rise above 14%. The bank’s net interest income fell by 2.4% to £2.8 billion.
Chief executive Paul Thwaite stated that NatWest had made significant progress in growing and simplifying its business, attracting over 200,000 new customers.
Analysts cheered the results, and here … we’ve curated some of the highlights.
In London, Natwest shares closed Friday 7% higher, at 361.9p.