Speaker 1: Bloomberg Audio Studios, podcasts, radio news, The Stock Movers podcast,
Speaker 1: your roundup of companies making moves in the stock market,
Speaker 1: harnessing the power of Bloomberg data.
Speaker 2: Let's take a look at some stocks on the move
Speaker 2: today in Europe. We're joined now by Bloomberg. Sam Unstead Morning.
Speaker 2: Sam Shell's earnings out this morning. Lots of headwinds.
Speaker 3: How do they do?
Speaker 2: Yeah, lots of headwinds for the oil industry generally. I've
Speaker 2: had quite a lot of reporting. Excellent mobils out later
Speaker 2: on today for those of you who can keeping an eye.
Speaker 2: Shell overall pretty good. So the really key thing with
Speaker 2: the oil industry and oil companies in particular is buybacks.
Speaker 2: They kept the pace of their buybacks up three and
Speaker 2: a half billion dollars a quarter. That was sort of
Speaker 2: broadly expected but still welcome from investors. But the really
Speaker 2: key thing is that their cash flow was pretty good.
Speaker 2: So although they've had to take on a bit more
Speaker 2: debt because the oil market has weakened a little bit
Speaker 2: and the macro picture is weakened, they are still keeping
Speaker 2: up the backpace and the cash flow is coming through,
Speaker 2: so there's a sort of confidence that they may well
Speaker 2: be able to navigate this a little bit better than
Speaker 2: some of their peers.
Speaker 3: Yeah, and it's interesting also the kind of oil market
Speaker 3: moves that we've been tracking after the kind of big
Speaker 3: leg lower on the worries around the US recession. Actually
Speaker 3: they have come up a little bit because of the
Speaker 3: possibility of US China trade talks and maybe even fresh
Speaker 3: sanctions or at least a threat of that against Iranian
Speaker 3: oil flows. So you've also seen a bigger move in
Speaker 3: terms of the oil market as the backdrop. Moving though
Speaker 3: to the chemicals, BASF they say in their earnings that
Speaker 3: they're still waiting to see a reaction.
Speaker 2: Yes, So this has been kind of a trend across
Speaker 2: the earning season of companies saying that right now things
Speaker 2: are so uncertain that it's really difficult for us to
Speaker 2: give a very strong guidance. Very few companies completely pulling
Speaker 2: their guidance, but definitely putting a lot of uncertainty over
Speaker 2: all of it. And I think BASF is often a
Speaker 2: very good company to look at in these things, and
Speaker 2: chemicals companies in general, because they play such a key
Speaker 2: role in the supply chain that isn't often sort of
Speaker 2: noticed quite so clearly. So BASF saying that, you know,
Speaker 2: prices have come under pressure in the first quarter, but
Speaker 2: now they have to wait and see as exactly what
Speaker 2: kind of effect tarraphs are going to have over the
Speaker 2: course of the rest of the year. So really in
Speaker 2: line with a lot of their industrial peers, you know,
Speaker 2: over the course of this earning season, uncertainty overshadowing basically everything.
Speaker 3: Yeah, uncertainty, uncertainty, ncerty.
Speaker 2: But that West, they say their earnings point them in
Speaker 2: a good direction. Almost no uncertainty from that West actually.
Speaker 2: So in Thatwest again we've had all the UK banks
Speaker 2: reporting over the course of this week that West pretty
Speaker 2: strong results again, big boots from mortgage lending. We've seen that,
Speaker 2: you know, the run up to the stamp duty threshold
Speaker 2: there was a huge rise in mortgage lending, saw that mployees.
Speaker 2: We've seen that in that West as well. For that West,
Speaker 2: you know, in comparison to the ones that have come
Speaker 2: earlier in the week, they have a much lower in
Speaker 2: fact almost no international exposure in the way the Barclays does.
Speaker 2: They also have a much smaller motor finance business, you know,
Speaker 2: compared to Lloyd's which is the largest lender in that space,
Speaker 2: and there's an ongoing probe there, so their results much cleaner. Really.
Speaker 2: The only drawback that analysts have said, and you know
Speaker 2: shares are up this morning, is that actually it could
Speaker 2: have been slightly better on the guidance. So the guidance
Speaker 2: has been at the top end of expectations, analysts saying
Speaker 2: that it is very possible over the course of the
Speaker 2: rest of the year they're actually top that that guidance.
Speaker 3: Yeah, you've got four more Bank of England quarter point
Speaker 3: ratecar are so priced in for this year. So yes,
Speaker 3: it's interesting, isn't it. And also those high street lenders
Speaker 3: seem to be entering a phase of a bit of
Speaker 3: a battle in terms of the mortgage market at least,
Speaker 3: which is quite they.
Speaker 2: Do, they do. But there's something that's quite interesting within
Speaker 2: the UK banks, and this has been talked about by
Speaker 2: analysts for quite a bit, is the structural hedges right
Speaker 2: that they have in place. These are these fixed income
Speaker 2: portfolios that help to smooth out fluctuations in lending rates.
Speaker 2: The UK banks have looked at as being as having
Speaker 2: much better structural hedges in place than a lot of
Speaker 2: the European banks. So although the rate cut bets have
Speaker 2: ramped up for the UK banks, they should be able
Speaker 2: to navigate that at least through to twenty twenty six,
Speaker 2: fairly speaking.
Speaker 1: The Stock Movers podcast from Bloomberg Radio. Check back with
Speaker 1: us throughout the day for the latest roundup of companies
Speaker 1: making news on Wall Street and for the latest market
Speaker 1: moving headlines. Listen to Bloomberg Radio Live, catch us on YouTube,
Speaker 1: Bloomberg dot com, and on Applecarplay and Android Auto with
Speaker 1: the Bloomberg Business app.