UK share prices watch: HL and Shell fall
Royal Dutch Shell (LON:RDSA) has been one of this Tuesday’s UK share prices to watch, with its strategy update failing to inspire investors. Blue-chip asset manager Hargreaves Lansdown (LON:HL) meanwhile is in the doldrums as high-profile fund manager Neil Woodford suspended dealing in the Woodford Equity Income Fund.
HL and Shell fall into the red
Heavyweight Shell has fallen into the red in today’s session, even as it increased its organic free cash flow outlook to around $35 billion, creating the potential for bigger shareholder payouts. The Anglo-Dutch energy major, however, also signalled a rise in spending going forward.
“With many attracted to the 5+% yield of the stock, the obvious positive is the improved outlook of cash flow to around $35 billion based on $60 per barrel which should continue to underpin good dividends or share buybacks,” Graham Spooner, an investment research analyst at The Share Centre, commented, as quoted by Proactive Investors, adding that the FTSE 100 group’s “proposed increase in capital expenditure to around US$30bn a year may act as a balance to the above”. Shell’s shares are changing hands 1.2 percent in the red in early afternoon trade, as compared with a marginally positive FTSE 100 index.
Shares in Hargreaves Lansdown have been sold off amid reports that Neil Woodford had placed a block on redemptions from the Woodford Equity Income Fund.
“It’s been a tough few years for Woodford and things look like they will get worse still,” Markets.com analyst Neil Wilson said, as quoted by Reuters. The newswire notes that HL includes the Woodford fund in six of its Multi-Manager investment packages.
The Financial Times meanwhile quoted Shore Capital analyst Paul McGinnis as commenting that the drop in HL’s shares reflected fears that retail investors who followed the Wealth 50 recommendations and invested money with Neil Woodford would react angrily to being stuck in the Equity Income Fund. He further added that shareholders in Hargreaves feared that its reputation among retail investors might suffer and that the company could lose business as a result, while investors who had bought the Woodford fund on the FTSE 100 group’s recommendations may “now blame Hargreaves” and move their money to another investment manager. Hargreaves Lansdown’s share price has given up more than four percent.
London-listed housebuilders have mostly been resilient after the IHS Markit/CIPS construction purchasing managers’ index for May slipped into contraction territory, falling from 50.5 to 48.6 last month. The latest reading marked the lowest result since the snow-related downturn in construction output in March last year.
“May data reveals another setback for the UK construction sector as output and new orders both declined to the greatest extent since the first quarter of 2018,” Tim Moore, Associate Director at IHS Markit, which compiles the survey, commented in a statement, adding that survey respondents had “attributed lower workloads to ongoing political and economic uncertainty”. Barratt Developments (LON:BDEV) is about 0.7 percent down, while Taylor Wimpey (LON:TW) has added about 0.4 percent. Berkeley Group (LON:BKG) meanwhile has spiked by about 1.7 percent.
In smaller London-listed companies, online electricals retailer AO World (LON:AO) has tumbled even as it reported a rise in full-year revenue. The company’s Europe adjusted EBITDA losses, however, widened during the reported period, reflecting less progress than expected on product margins and cost pressures from re-configuring driver scheduling arrangements in Germany. AO World’s shares are down by more than seven percent in early afternoon trade.
Budget airline Wizz Air (LON:WIZZ) is flying higher in London in today’s session after reporting today that its passenger numbers had climbed by 22.4 percent last month, while its load factor had come in two percentage points higher at 93.9 percent. Wizz Air’s share price is up by 3.7 percent so far today.
If you are more interested in stocks on the other side of the Atlantic, check out our update on the US and Canadian stock markets. Alternatively, if you want to dip your toes in trading currencies, here’s an article on swing trading forex.
UK share prices to watch on Wednesday
The UK services PMI for May is likely to bring some excitement on the stock market tomorrow, especially following this week’s downbeat manufacturing and construction PMIs. IG reports that the services PMI is expected to have climbed to 50.7 last month, from 50.4.
While no blue-chips are scheduled to report tomorrow, Wednesday will mark the FTSE 100’s quarterly reshuffle, meaning that easyJet (LON:EZJ) will be among tomorrow’s UK share prices to watch, with the airline largely expected to leave the benchmark index. Proactive Investors reports that JD Sports (LON:JD) is tipped to take its place, while Hikma Pharmaceuticals (LON:HIK) could be replaced Aveva (LON:AVV) in the Footsie.