The UK pharma giant Astra Zeneca, famous for many things, and more recently for the mass manufacturing of pioneering University of Oxford Covid-19 vaccine. Its heritage has its roots from ICI (Imperial Chemical Industries).
The graph speaks volumes
A few weeks ago, the UK insurance giant, Aviva PLC paid out its September dividend to shareholders
The dividend was 10.3p a share.
the total number of voting rights in Aviva plc was 2,802,902,021.
2,802,902,021 x £0.103 = 288,698,908.163
That is £288.698 Million paid to shareholders
The JPMorgan American Investment Trust plc is a London listed investment trust.
It aims to generate attractive long-term returns from the world’s largest stock market by focusing on high quality companies that are also reasonably priced. It aims to achieve capital growth from North American investments by outperformance of the S&P 500 index. The trust predominantly invests in quoted companies including, when
appropriate, exposure to smaller capitalisation companies, and emphasise capital growth rather than income. The Company has the ability to use borrowing to gear the portfolio within the range of 5% net cash to 20% geared in normal market conditions.
Microsoft Information Technology 5.6% of the fund
Apple Information Technology 5.3% of the fund
Tesla Consumer Discretionary 4.2% of the fund
Bank of America Financials 4.1% of the fund
Amazon Consumer Discretionary 3.9% of the fund
United Health Group Health Care 3.8% of the fund
Alphabet Communication Services 3.5% of the fund
Martin Marietta Materials 3.2% of the fund
Loews Financials 3.2% of the fund
Berkshire Financials 3.2% of the fund
A few weeks ago Scotland’s largest asset manager, Abrdn PLC (formerly known as Standard Life plc) paid out its September dividend to shareholders.
7.3p a share.
The Company’s issued share capital consists of 2,167,475,819 ordinary shares
2,167,475,819 x £0.073 = £158,225,734.787
That is £158.225 Million, paid to shareholders.
It is a windfall tax, punishing investment in Green Energy companies.
The effect on the UK Green Energy sector has been brutal and dramatic, as the graph’s below show:-
A Beautiful Goodbye Wave
The Bank continues to monitor developments in financial markets very closely in light of the significant asset repricing of recent weeks. It has also been working with the UK authorities to address risks to the resilience of Liability Driven Investment (LDI) funds arising from volatility in the long-dated government bond (gilt) market
The Bank said it would buy more government bonds to try to stabilise market conditions. Its emergency scheme started after September’s mini-budget, which spooked markets and drove up borrowing costs. Government borrowing costs rose again sharply on Monday after the Bank said the scheme would end this week.
Another month, guess what, take a lucky guess, it is the same old story, HM Government, spends more money than it receives via taxes and duties.
Now we are in a post Covid 19 world. UK’s HM Government needs to fund many new demands. [www.dmo.gov.uk]
Another deficit month, thus to bridge the gap, needs to borrow on the bond market In September 2022, the HM Government had to borrow money to meet the difference between tax revenues and public sector expenditure. The term for this is The PSNCR: The Public Sector Net Cash Requirement. There were only 4 auctions of Gilts (UK Government Bonds) by the UK Debt Management Office to raise cash for HM Treasury:-
27-Sep-2022 0 1/8% Index-linked Treasury Gilt 2031 3 months £1,200.0000 Million
07-Sep-2022 1% Treasury Gilt 2032 £3,437.5000 Million
06-Sep-2022 0¼% Treasury Gilt 2025 £4,183.1570 Million
01-Sep-2022 0 7/8% Treasury Gilt 2046 £2,499.9990 Million
£1,200.0000 Million + £3,437.5000 Million + £4,183.1570 Million + £2,499.9990 Million = £11,320.656 Million
£11,320.656 Million = £11.320656 Billion
On another way of looking at it, is in the 30 days in September 2022, HM Government borrowed:- £377.3552 Million each day for the 30 days.
We are fortunate, while the global banking and financial markets still has the confidence in HM Government to buy the Gilts (Lend money to the UK), the budget deficit keeps rising. What is also alarming, is the dates these bond maturing from 2025 to 2046. All long term borrowings, we are mortgaging our futures, but at least “We Are In It Together……”
Yesterday, the UK pharmaceuticals giant GSK paid out its dividend.
It was £0.1625 a share.
the total number of voting rights in the Company is 4,067,377,650
4,067,377,650 x £0.1625 = £660,948,868.125
That is £660 million paid to shareholders
Share Price Graphs in: Gresham House Energy Fund, Legal & General, Tesco, NatWest & HSBC.
The last few days have seen a radical reshaping of the Government’s economic policy and a radical reaction from financial markets. HM Government is will to ramp up borrowing, and reducing its tax revenues (by lowering income tax) in their plan (hope) for economic growth. However surging borrowing costs for Government was surely never part of the plan.
In the presentation link above from the very well respected Resolution Foundation they explore what this means for the UK economy going forwards. You can also can watch the YouTube video below with key input from Stephanie Flanders, Senior Executive Editor at Bloomberg and Head of Bloomberg Economics and Robert Colvile, Director of the Centre for Policy Studies