Wednesday, May 12, 2021

Barclays resumes dividend as 2020 profit falls 30%; markets await US data – business live | Business

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Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

Barclays has resumed dividend payments as its 2020 profit dropped by 30% to £3.1bn. This was a better than expected result, as a strong performance by its investment banking division offset provisions against bad loans made because of the Covid-19 pandemic. The bank will pay a dividend of 1p a share for 2020 and embark on a share buyback of up to £700m.

Barclays also released its annual report, which shows that its chief executive Jes Staley was paid £4m last year, down from £5.9m the year before. This includes salary, bonuses and pension payments. Tushar Morzaria, the finance director, received a total package of £2.8m, down from £3.9m in 2019.

Our banking correspondent Kalyeena Makortoff notes that Staley donated £392,000 of his own income last year to the bank’s coronavirus fund, but did not waive his bonus like rivals at NatWest and Lloyds.

The online greeting cards and gifts retailer Moonpig, which recently made its stock market debut, had its strongest week-ever for sales in the run up to Valentines Day and is on track to double its annual revenues. It has benefited from a shift to online spending in the wake of the pandemic, with card shops forced to close during lockdowns.

Global stock markets have had a good few weeks as optimism spread about mass vaccination campaigns against Covid-19, and the proposed $1.9 trillion stimulus scheme in the US. On Monday, the UK hit its target – vaccinating 15m people by 15 February (most of them still need a second shot, though).

David Madden, market analyst at CMC Markets UK, says:

The update triggered chatter that Britain could ease up on some of its restrictions in the next few weeks, so that contributed to the wider view the global economy will recover from the pandemic in the months ahead.

The minutes from last month’s Fed meeting were published last night and it showed the central bank is keen to have an accommodative policy to help assist the economy. It wasn’t exactly new information but the message was that monetary policy is unlikely to change anytime soon as the economy still has a long way to go before the Fed reaches its targets.

Commodities have been rallying too. Oil hit a 13 month high, platinum surged to the highest level since September 2014, and copper rose to an eight-year high.

Bitcoin scaled to a new record high of over $52,000 last night, but has since fallen back to $51,558.

However in Asia, most stock markets are in the red, with Japan’s Nikkei down 0.19% and Hong Kong’s Hang Seng tumbling 1.3%. Trading resumed in China after the Lunar New Year celebrations, where the Shanghai composite index rose 0.55%. We are expecting European stock markets to open cautiously higher, ahead of a raft of US data out later today.

The Agenda

  • 10am GMT: European Central Bank financial statements
  • 12:30pm GMT: ECB Monetary policy meeting accounts
  • 1:30pm GMT: US Building permits, housing starts for January
  • 1:30pm GMT: US Initial jobless claims for week to 13 February (forecast: 765,000)
  • 1:30pm GMT: US Philadelphia Fed Manufacturing Index for February
  • 3pm GMT: Eurozone consumer confidence flash for February (forecast: -15)

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