So much for my hope that 10 year yield pressure might abate a little yesterday. The opposite happened and one has to go back all the way to late summer 2008 for 4.563%. |
Looks like a hammering at open tomorrow...whatever happened to Santa rallies? |
Broker upgrades, they fire these out sooooo regularly, yet the price does what the market dictates.Do you buy on broker recs? |
Re: interest rates.
I presume the original idea was for the BOE to contain inflation caused by our internal economy eg. consumer spending, wage rises…
So is there any logic to use interest rates to control inflation when its caused by external factors?
Surely all the rises do, is mess up internal growth and spending? |
 Broker tips: Aviva
Wed 11 Dec 2024
Jefferies has reiterated its 'buy' stance on Aviva after the insurer's £3.6bn takeover pursuit of Direct Line was agreed by the latter's board but said that the deal brings major execution risks. Aviva's share price has fallen around 3% since the 275.0p-per-share offer for Direct Line was accepted on 6 December, after two earlier offers of 250.0p and 261.0p were rejected last month. "We agree with the market reaction to the deal, because although the financial rewards appear compelling, the execution risks should not be overlooked," Jefferies said. While the broker acknowledged that the takeover brings "compelling" financial and strategic prospects - from significant operational cost synergies to reducing competition in the market - it highlighted "material execution risk".
Integration of Direct Line's IT systems will be a sticky issue, Jefferies said, because of the company's recent investment programme. "It's not clear which system Aviva ought to decommission. However, as Aviva's book is performing better, it might be safer to write-off Direct Line's investment and move that book to Aviva, even if the systems are older," the broker said. Meanwhile, Direct Line's strategy since its IPO of "moving down the risk curve" has not been successful in growing earnings sustainably, and Aviva will need to decide whether to "re-risk the book", the broker said. |
The 10 year gilt yield has softened a smidge (with consequent /matching fall in sterling), but nowhere near enough to offset the significant spike in yield yesterday and the grind upwards thru December.Now still hovering at 14 month highs.
Another long day at the office. |
Well at least UK inflation figures decent this morning so hopefully take the upward pressure off interest rates for a little while(he says hopefully). |
It's old news and seems a misleading headlinehttps://www.telegraph.co.uk/business/2023/12/13/white-male-recruits-final-sign-off-aviva-boss-amanda-blanc/ |
Last thing you want is Musk tweeting about it. |
I agree with Musk on Blanc. Aviva is too woke. They are taking on DEI hires rather than the best talent.
It never works out well for shareholders. |
Post 20422. One of many of the headless chasing an endless rainbow |
rising bond yields on gilts are becoming a problem.
No doubt it is what the new government fear most.
Why they put up taxes in the budget.
Some predicting American 10 years will reach 6% after disruptive Trump takes over.
Not good for the UK.
Who is going to buy UK government 10 years debt for 4.5% when you can buy US debt at 6%?
This party could come crashing down caused by eye watering debt everywhere which will become expensive.
No QE possible this time as inflation is a problem. |
The dividend yield going forward here is not encouraging as no buy-backs due to paper being issued with Direct line potential acquisition. That will suppress the increases we have seen over the last 2 years in my opinion. The acquisition may over time produce some incremental benefit but then with the new paper in place I am less convinced in staying the course with Aviva. I decided to exit at 490p and had moved more funds into LGEN ahead of their very positive (for growth) presentation on November 4th. After jumping from 219p to 241p the fall back in the share price along with the market provides reasonable value today and a yield of 9%. I may be proved wrong and will re-enter Aviva again if we get to 450p levels. The brokers still like Aviva and that is encouraging. I personally just wish that they had not increased their potential offer for DL. |
UK Long Bond rates are ever rising, currently 4.775% for 10 year gilts
Hard to see how the Market can make any progress with this background
Also not good for our High Yielding stocks |
They have overpaid. The loyal servants that post of 500 and a fantastic bargain need to come away from last night's chip bags. Spud, I too see a drift to 450, maybe lower before news or an update, it isn't a done deal so not all the downside is in the price. |
Here we are steadily drifting down in anticipation of the acquisition. I'm feeling a 450p price on or around the 25th if it's confirmed with a slow rise back to around 500p next year as we go Aviva (not so ) Lite. If the t/o is blocked I see an immediate jump back to over 500p. With regards to the dividend, I see no continuation in the medium term of the steady and reliable increases we have been enjoying which is as a consequence of the increased offer price, DLG dividend & inevitable redundancy program costs. There will be an awful lot to unpick if this goes ahead and I'm not sure the phrases of 'Plain Sailing' & and 'Synergy Amalgamation' is in any way appropriate unfortunately, but I sincerely hope that I'm wrong.spud |
Decisions for non tax reasons haven't been brilliant either |
Whatsup
The worst investment decisions are made....'For tax reasons' |
For tax reasons I'd like less dividends and more capital growth. |
I think we all expect the deal to go through. Its a strong challenge for our CEO to maximise the benefits from the merger and develop the top UK player in home and motor insurance. It will be interesting to see how this will affect the FY dividend payout, hoping the strategy here is maintained. Interesting times .. GLA |
UK motor insurers to rebound from worst year on record says EY"
FT TODAY
"Motor insurers paid out .93p to the pound compared to 1.13 previously "
Falling inflation and claims
Falling Motor insurance premiums first six months of this year 2024 will push it back into slight loss in 2025
Article expects government to take a closer look at Av- Direct takeover. |
I suspect they had space reserved in the paper for something concrete and then, in its absence, ran this filler piece instead. |
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