Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
There’s a short trading update out from Diageo [LON:DGE] this morning ahead of the company’s AGM. Since the start of the financial year, they note that the US market is performing better than had been expected, whilst in Europe, it’s off-trade that shines. Overall, the outlook for the first half has improved and although the pace of recovery remains uncertain, there’s confidence in the resilience and long term fundamentals of the business.
Newspaper publishers Reach [LON:RCH] have half year numbers out today, covering the period to June 28th. Revenues were off 17.5%, although the company is keen to focus on its Q3 performance, where digital ad revenues advanced. Sales of physical newspapers were also hit hard by the COVID lockdown and a reported improvement in recent months is noted here, too. A transformation plan announced back in July to reshape the group is now complete and expected to deliver annual savings of £35m. In summary the traditional news publishing model continues to battle headwinds and Reach is largely left celebrating the fact that the pace of declines has slowed year-on-year. The exception is digital revenues which are advancing and as admirable as that might be, it doesn’t look terribly sustainable in the long term.
Followers of our new AIM column will have seen repeated mention of ValiRx [LON:VAL] last week as the company’s share price soared in anticipation of clinical trial results. Last Monday, shares opened at 24.15p breaking 65p on Thursday and finishing the week at 53.5p. Results have been released this morning and the drug – VAL201 – is heralded as having the potential to be safe and well-tolerated. Only 12 patients were involved in the trial but it paves the way for further development in terms of optimising dosing strategies. The market’s reaction from here will be worth watching.
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