TUESDAY 14TH JULY 20.00GMT FTSE 100 ends in neural mood. Boris Johnson orders Huawei equipment to be purged completely from Britain’s 5G network by 2027. European stocks were hit by a selloff in technology shares on Tuesday, as U.S. peers slumped on fears of new coronavirus restrictions, while London blue-chips outperformed on a boost for the telecoms and energy sectors. Global equity markets wavered and gold prices rose on Tuesday after a rollback of California’s reopening hit sentiment, but cyclical stocks surged on Wall Street as some investors bet a recovery would overcome the COVID-19 pandemic’s spread. British airline Virgin Atlantic is close to securing a 1.2 billion pound ($1.5 billion) rescue deal, Sky News reported on Tuesday, removing the medium-term chance of administration as a result of the coronavirus crisis. UK review of capital gains tax heralds future rises, experts say. Wealth managers say chancellor’s move suggests CGT will be used to help fill public finances hole. Global stocks slipped on Tuesday, oil sagged and a safety bid supported the dollar as simmering Sino-U.S. tensions and new coronavirus restrictions in California kept a lid on investor optimism with earnings season getting underway. Sterling was close to its 200-day moving average of $1.27 against the dollar on Monday, last trading flat at $1.2616. European stocks opened lower on Tuesday, hit by a drop overnight on Wall Street following a flare-up in U.S.-China tensions and new coronavirus restrictions. UK economic output rises 1.8% in May after historic April plunge. ‘Disappointing’ rebound in GDP was much weaker than the 5.5% forecast by economists. England to make masks mandatory in shops. Policy comes as ambiguity over returning to work causes frustration among businesses.
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PORTFOLIO PERFORMANCE:2017   2019 Trades   2019  Recent Purchases:  ITM  Saga   Bvc   Ltg    Ctec    Cnc  Cprx   Odx    Segro   Iofina

Trading Activity Bought[9 July] 2500 Shares in ITM Power Plc @ £3.11 Bought[9 July] 2250 Shares in BATM Advanced communications Ltd @ £1.308 Sold [9 July] 10000 Shares in Omega Diagnostics@£0.364 Sold [9 July] 3700 Shares in ConVaTec Group Plc @ £1.92 Bought [3 July] 2750 Shares in BATM Advanced communications Ltd @ £1.178 Bought[2 July] 50000 Shares in SAGA Plc @ £0.166Bought[2 July] 6000 Shares in Learning Technologies Group Ltd @ £1.236Bought[1 July] 2000 Shares in BATM Advanced communications Ltd @ £1.078 Bought [30 June] 8000 Shares in BATM Advanced communications Ltd @ £1.01 Sold [29 June] 10000 Shares in Omega Diagnostics@£0.443 Sold[26 June] 2000 Shares in Segro Plc @ £8.95Sold [24 June]1003 Shares in Pluristem Therapeutics Inc @ $8.40 Bought [9 June] 10000 Shares in Omega Diagnostics@£0.587 Sold [9 June] 120 Shares Novo-Norstick @ £51.26

STRATEGY FOR Week Commencing 13 July – The term ‘helicopter money’ is a term unfamiliar to many. Cash for Free from a helicopter! CLICK HERE and CLICK HERE.   It was former Fed Governor, Ben Bernanke, who coined the phrase suggesting that helicopter money could always be used to prevent deflation. Helicopter money is unconventional monetary policy, when the economy is in a liquidity trap (i.e. when interest rates near zero and the economy remains in recession). The original idea of helicopter money describes central banks making payments directly to individuals, including the ‘permanent’ monetization of budget deficits – with the additional element of attempting to shock beliefs about future inflation or nominal GDP growth, in order to change expectations. As the pandemic continues to devastate, the distribution of free money [i.e. helicopter money] would now seem to be the new kid on the block in solving low growth, high and rising levels of unemployment and frozen economies. Last week’s announcement of further stimulus by UK and US economies has all the hallmarks of helicopter money. According to the Bank of America, total global stimulus, including both fiscal and monetary, has already reached a whopping US$18.4 trillion this year designed to counter the retrograde in declining business activity, recessions and geopolitical uncertainties is a store of trouble for the future as projections of the resurgence of a bear market become a standard pitch. The reliance on borrowing and debt has become a common theme with too much debt in the US corporate and Government sector now obvious. With the UK policy objectives of borrowing as much as it can at low rates of interest this can seem an easy way out. Short term fixes have alas long term consequences as future generations will become burdened with debt from its forefathers. Inter-generational factors may even become the focus of the upcoming US election. Recent geopolitical factors may well come into play to shape the directions of markets over the summer. UK/China international relations on security law changes in Hong Kong, the continued impasse of Brexit negotiations suggesting that a no deal continues to be a possibility, a considered U turn change in UK policy in the use of Huawei as a lead facilitator in 5G and the continuing geopolitical effects of the pandemic all providing reasons for caution in market involvement. The portfolio resumed to the positive last week with a +1.31% increase. Last week I needed to take action to address the poor performers. The continued share price decline of Omega Diagnostics over the last three weeks lead me to reduce my holdings in the share. Too much hyperbole and the company’s sudden request for additional equity funding persuaded me to reduce my holding. When a share starts too become problematic time for reassessment. Keep it simple always a good adage. I discharged ConvaTec Group as poor performer and continuing price fall led me to get rid before it came a problem. My current approach to portfolio management is too shift the emphasis to reduce risk and reduce profit dilution. That being said, I looked at increasing holdings in BATM Advanced Communications and ITM Power plus plc acquisition. I reassessed my approach to share price decliners adopting a revised approach eliminating those that continually disappoint.   SDI and Iofina are candidates for disposal when the time is right. UK House builders saw an uptick last week with Bellway +6% and Redrow +9%. Last week’s policy change by the UK chancellor on a stamp price moratorium may see a temporary reprieve for UK house builders till March 2021. Recent acquisition SAGA has yet to show itself to be a worthy addition.  The recent resurgence in Spirent Communications has provided welcome relief offset the loss in profit dilution in Omega. I may look to continue to reduce my holdings in Omega if share price decline continues. Last week’s +9% increase in Spirent Communications may be a starter for 10 or a mere blip of positivity. Yet one needs to be conscious that the upcoming revised approach to Huawei involvement in UK 5G  may yet have an influencing factor in the likely projections on Spirent share price performance in the near future. I keep faith with Spirent on possible broker upgrades on the share. US Pharma shares Bristol Myers, Catalyst Pharma and Cetene keeps my US involvement but I may look to take quick profits when appropriate and move on to other shares. I will be looking to a shifting emphasis in eradicating the poor performers. This week I will be a reviewing and monitoring particularly the new additions. Until Next Time.

STRATEGY FOR Week Commencing 6 July    Week Commencing 29 June   W/c 22 June             


Portfolio for week commencing  13th July

14July2020 US/UK Price Price Price wkcge 14 Jul Price Mrkt
Stock Shares Bought 3 Jul 10 Jul % 20.00gmt Now Beat
FTSE 100 FTSE Entry 6157.30 6095.41 1.38 6179.75 Index
NASDAQ NDX at Bid 10207.63 10617.44 -1.78 10428.46 Index
Company Symbl £ £ £ % £ $1.255
BATM BVC 1.01 1.15 1.23 2.03 1.26 Price£ Bvc
Bellway plc BWY 17.86 24.99 26.55 -2.30 25.94 Price£ Bwy
Bristol Myers BMY 47.12 47.38 45.51 1.03 45.98 Price$ Bmy
Catalyst Pharma CPRX 3.59 3.95 3.91 0.10 3.92 Price$ Cprx
Cetene Corp CNC 49.37 53.28 51.92 -0.50 51.67 Price$ Cnc
Iofina plc IOF 0.28 0.17 0.16 -7.69 0.15 Price£ Iof
ITM Power Plc ITM 3.11 2.75 3.13 -6.55 2.93 Price£ Itm
Learning Tech Grp LTG 1.24 1.27 1.24 -5.00 1.18 Price£ Ltg
Omega Diagnosts ODX 0.20 0.42 0.39 -7.18 0.36 Price£ Odx
Redrow RDW 4.64 4.27 4.64 -2.71 4.52 Price£ Rdw
SAGA Plc SAGA 0.17 0.16 0.16 -1.15 0.16 Price£ Saga
SDI Group plc SDI 0.76 0.52 0.53 0.94 0.54 Price£ Sdi
Spirent comms SPT 1.45 2.52 2.53 -0.99 2.51 Price£ Spt
WkyPortfolio Performance -0.60% +1.31%

Update on Shares in the Portfolio

Omega Diagnostics 2 July

Omega Diagnostics’ ELISA antibody test gets approval in India. Medical diagnostics company Omega revealed on Thursday that its CE-Marked Mologic ELISA antibody test had been approved for Covid-19 testing in India.Omega said the Central Drugs Standard Control Organization, part of India’s Ministry of Health and Family Welfare, had published a list of kits approved for testing of Covid-19 on Wednesday, which included Omega’s ELISA antibody test.The AIM-listed group said approval for sale remained conditional on the submission of supporting technical data, of which the company said it was “confident” it would be successful, granting the firm the ability to sell its antibody test directly into the “potentially significant target market”.While Omega said “the quantum of future sales” was unknown at present, it highlighted that India was “clearly a significant addressable market”.Chief executive Colin King said: “We have an established direct sales team and we believe a reliable and high-performance antibody test will be very attractive to our laboratory customers.”Clearly this is an important market for us to target and I look forward to updating shareholders on our commercial traction.”

Redrow Plc 30 June

Redrow warns of full year profits hit as it scales back London ops. Housebuilder Redrow said annual profits would be “substantially” lower after scaling back its London operations and factoring in the impact of Covid-19. Redrow said it turnover was expected to fall sharply to £1.34bn against £2.11bn last year and consensus forecasts of £1.46bn. It completed 4,032 homes in the year to the end of June, down from 6,443 in the previous year, but the order book was at a record £1.42bn for the fiscal year starting in July, as construction would be second half weighted. The company also called on the government to extend its controversial ‘help-to-buy’ scheme, which is due to end next March. The timing of site closures due to Covid-19 towards the end of March had a profound impact upon the group’s results in a year, which was budgeted to be disproportionately weighted to the end of the second-half, the company said.Redrow said it was scaling back its London to focus on higher returning regional businesses and its higher-specification Heritage range of period-style arts and crafts homes.Costs and related significant impairments associated with the scaling back of the London business will be provided for in the June 2020 accounts, the company said.

Saga 22 June

Saga pays out £44m after Covid-19 halts travel business. Saga has refunded £44m to customers after the Covid-19 outbreak halted its travel business, the over-50s holiday and insurance specialist confirmed on Monday.
The group suspended travel operations in mid-March, scrapping all departures up to and including August. Customers who had holidays cancelled have been either refunded or rebooked on future trips; as at 31 May, £44m of advance receipts had been refunded, Saga said. It added that it expected “some travel” to resume this year and that retention levels continued to be high, particularly in cruises. However, Saga conceded that its stress tests included one based on travel not fully resuming until 2021.Regarding liquidity, Saga said its position remained “strong” and benefited from diversified sources of income. As at 31 May, available cash balances, which exclude the Saga Tour CAA ringfenced group, were £30m with access to a further undrawn £50m on the group’s revolving credit facility. Euan Sutherland, chief executive, said: “Saga has made good progress against the priorities set last year, and we have accelerated this change given the backdrop for the Cogid-19 crisis.

Omega Diagnostics 21 June

Omega Diagnostics Group plc has announced its intention to raise cash by way of an open offer. The Open Offer will be available to all Shareholders as at close of business on 19 June 2020. If you hold Shares at this time you will be entitled to purchase 1 new Share for every 20 Shares held, at a price of 40p per Share. Excess applications will also be available.

Learning Technologies Group Ltd 19 June

Digital learning and talent management business Learning Technologies said on Friday that it was in “a strong and resilient position” after continuing to see demand in line with expectations.Learning Technologies told investors at its annual general meeting that the group was “well-placed” to further consolidate the digital learning and talent sector following its recent equity fundraising and stated it would look to capitalise on “exciting acquisition opportunities” as they emerge.The AIM-listed group added that it would also look to capture benefits associated with the acceleration of structural industry trends towards digital learning and talent management, as the company looks to meet its “ambitious medium-term goal” of achieving roughly £230m revenues and £66m of adjusted underlying earnings on a run-rate basis by the end of 2022.Excluding gross placing proceeds of £81.8m received in June, net debt was £4.5m as of 31 May.

Bellway Plc 9 June

Bellway maintains forward sales as offices reopen. Bellway updated the market on its operations on Tuesday, reporting that construction activity had restarted at around 230 sites, while all remaining sales offices reopened in England on 1 June. The FTSE 250 company said viewings were limited to single family groups, and were on an appointment-only basis.It said its balance sheet remained “strong”, with net bank debt standing at £157m as at 31 May, narrowing from £261m on 2 June 2019, along with committed bank facilities of £545m.In addition, although undrawn, the group said it had been confirmed as an eligible issuer for the government’s Covid Corporate Financing Facility (CCFF), with an issuer limit of £300m.The company also said that its forward sales position was “substantial”, with an order book comprising 6,038 homes, compared to 6,312 homes a year ago, carrying a value of £1.57bn, down slightly from £1.64bn. That, together with its site reopening programme, should enable the group to preserve its strong liquidity position in the months ahead, the board said.

Omega Diagnostics 9 June

Omega Diagnostics updated the market on a number of fronts on Tuesday, announcing the signing of a longer-term supply agreement with Mologic, first orders for the Covid-19 ‘ELISA’ test, and the signing of an additional material transfer agreement with Mologic.The AIM-traded firm said it signed a supply agreement with Mologic, under which Mologic would supply raw materials to enable Omega to manufacture its CE-marked ELISA antibody test. It said the antibody test would play a “key part” in identifying people that have antibodies, demonstrating previous infection with Covid-19.Omega also announced that it shipped its first order for the Covid-19 ELISA test to Senegal, worth around £0.1m, and that it was currently engaged in registration and evaluation activities in 15 countries, which was expected to lead to orders in the near future.In addition would also produce a lateral flow antigen test product, that would determine the concentration of Covid-19 antigens in a human blood, saliva, or swab extract samples, which would also be used to identify an individual with an infection.Omega said it would continue to manufacture the 69 CE-marked allergens developed to date, to meet ongoing commercial demand from its partner Immunodiagnostic Systems.

Omega Diagnostics 3 June

Omega Diagnostics saw ‘significant progress’ in Covid-19 antibody test. Medical diagnostics company Omega said on Wednesday that the UK Rapid Test Consortium has made “significant progress” in developing a Covid-19 lateral flow antibody test that can be used by people in their homes.As the lead party of the UK-RTC, Omega said its partner Abingdon Health had been developing a Covid-19 rapid test and made solid progress in just “a short period of time”. Omega stated its role as a member of the UK-RTC was unchanged and will provide volume manufacturing capacity of the test once design freeze has been attained by Abingdon.

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