20th Sep 2023. 8.56am
Regency View:
Update
Regency View:
Update
Aviva rally on sale of Singlife stake
Aviva (AV.) is selling its 25.9% stake in the Singlife joint venture and two debt instruments to Sumitomo Life for a total of $997 million. This move is part of Aviva’s strategy to simplify its business operations.
The transaction is expected to be finalised in the fourth quarter of 2023. Aviva’s CEO, Amanda Blanc, believes this sale will strengthen the company’s position in the UK, Ireland, and Canada.
Aviva’s shares saw a significant increase of up to 3.4% following the announcement (last Wednesday), marking their largest daily rise since January. The Singlife joint venture contributed £17 million to Aviva’s operating profit in 2022.
The shares have shown strong upwards momentum having tested key support last week and this has coincided nicely with our decision to snap up a second tranche of the stock.
AV. Daily Candle Chart
EU regulator backs AstraZeneca and Daiichi’s lung cancer drug
AstraZeneca (AZN), in collaboration with Daiichi Sankyo, has received a recommendation from the European Medicines Agency’s human medicines committee for their cancer drug Enhertu. This recommendation is specifically for using Enhertu as a standalone treatment for patients diagnosed with a type of non-small cell lung cancer (NSCLC).
The basis for this recommendation comes from mid-stage data, which demonstrated an impressive 49% confirmed objective response rate and a median duration of response lasting 16.8 months among patients who had previously undergone treatment for lung cancer.
It’s worth noting that Enhertu is already approved for use in the European Union as a treatment for patients dealing with an advanced form of breast cancer.
However, it’s important to understand that these recommendations made by the human medicines committee still need formal approval from the European Commission before they can be implemented.
On the price chart, AstraZeneca continue to consolidate sideways in choppy range. In the context of a powerful multi-year uptrend, we expect this shoppy consolidation to eventually resolve in higher prices.
AZN Daily Candle Chart
Glencore lifted by ECB and hopes of China rebound
Glencore (GLEN) and the FTSE’s mining giants put in a strong rally last week driven optimism that major central banks were nearing the end of their rate hike cycle and positive economic data which suggested that China’s economy was on the verge of a rebound.
The European Central Bank (ECB) had recently raised its key interest rate to a record 4% and indicated that it would maintain this level until inflation returned to target levels. However, markets were holding onto hopes that the ECB might eventually consider cutting rates, especially as the eurozone economy showed signs of weakness.
Mining stocks received an additional boost from fresh data that indicated Chinese retail sales and industrial output for August had surpassed economists’ expectations.
China’s central bank had also taken action by reducing banks’ reserve ratio requirements for the second time in the year, aiming to stimulate the economy by increasing the flow of credit to households and businesses.
GLEN Daily Candle Chart
Unilever announces commencement of final tranche of share buy-back programme
Unilever (ULVR) has initiated the fourth and final phase of its share buy-back programme, with a total value of up to €3 billion.
This program was originally announced on February 10, 2022, and spans over two years. The first three tranches of the program, each valued at €750 million, have already commenced.
Unilever said the purpose of this fourth tranche is to reduce its capital, and buy-back being carried out within the authority granted by the company’s general meeting on May 3, 2023. The maximum number of shares that can be repurchased under this authority is 253,000,000.
This fourth tranche is scheduled to run from September 8, 2023, to no later than December 22, 2023.
Unilever’s share price is down 9% from its May highs, and recent price action has hammered out a strong base of support. With the support of the buy-back, we would expect to see the shares continue to climb over the next three months.
ULVR Daily Candle Chart
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