5 trending stocks on FTSE: Nvidia, Rolls Royce, Scottish Mortgage, Lloyds Banking, and IAG

Summary

  • Bank of England forecasts inflation to be above its earlier expectations as a result of the temporary pent-up demand.
  • Recently, Palo Alto Networks collaborated with NVIDIA to use its BlueField data processing unit for the development of the first-ever virtual next-generation firewall.
  • Babcock International Group and Rolls-Royce Holdings appointed investment bankers to sell their combined shareholding of 50% in AirTanker.

The economy is bouncing back strongly from the lockdown due to the resumption of activities in key sectors. UK’s is all set on the road to recover post a grim 2020, as the number of workers on payrolls surged in June 2021 by 356,000.

The Bank of England (BoE) raised its forecast for the inflation rate, but also said that the rise in prices would be temporary as a result of the pent-up demand post-lockdown. The increase in prices will be fuelled by a surge in commodity and energy prices. 

Only time will tell the economic impact of the spread of new COVID variants as well as the withdrawal of BoE and UK government support to lower unemployment rates in the country. The government also underlined the need for investments in key growth sectors, such as fintech, that are expected to have an altering impact on the economy.

Here we take a look at 5 FTSE trending stocks:

Nvidia Corp (LON: 0R1I)

Nvidia is all set to take the chip market by storm. The graphics processing unit and chip designer showcased Wolfenstein: Youngblood game running on its RTX 3060 GPU and ARM-based Kompanio 1200 processor from MediaTek, at the Game Developers Conference (GDC) 2021. The launch is expected to pave the way for laptops that can be operated fully on ARM chips along with PC-class gaming GPUs from Nvidia. The company’s acquisition of ARM is also expected to strengthen its hold in the chip market, as chips made on ARM designs are becoming popular among PC makers. The tech giant Apple also announced the shift away from Intel to its own ARM-based M1 chip for Macbooks.

In July 2021, Palo Alto Networks collaborated with NVIDIA to use its BlueField data processing unit (DPU) for the development of the first-ever virtual next-generation firewall (NGFW) aimed at boosting cyber defences, as well as improving data centre efficiency and security. Nvidia also rolled out a new graphics driver GeForce driver version 471.41, with WDDM 3.0 aimed at enhancing the overall performance of Windows 11.

The company’s stock trades at USD 188.30, up by 3.03 per cent, at 13:30 PM on 21 July 2021. In the last one year, the stock has given a return of around 82 per cent.

Rolls-Royce Holdings Plc (LON: RR.)

On 20 July 2021, Babcock International Group and Rolls-Royce Holdings appointed investment bankers to sell their combined shareholding of 50% in AirTanker, operator of RAF's fleet of Voyager aircraft.

The jet engine manufacturers reported revenues of £11.76 billion for the year ended 31 December 2020, a decline from the previous year revenues of £15.45 billion.

Meanwhile, Specialist engineers at the British multinational aerospace and defence company’s Barnoldswick aero engine factory in Lancashire are going on strike against the long-term viability of production operations in the facility. In January 2021, Unite union signed a deal to guarantee the future of the factory. The current action may be detrimental to company’s operations and comes during a crucial time when the management as well as the members of the Unite union need to work together to achieve targets.

New COVID-19 related developments and changing travel restrictions across different countries have rendered the company’s share movement volatile.

The company’s stock was trading at GBX 93.28, up by 6.18 per cent, at 13:22 PM on 21 July 2021.

Scottish Mortgage Investment Trust Plc (LSE: SMT)

Scottish Mortgage Investment Trust Plc appointed a new manager who is slated to join duties by April next year, post the resignation of the company’s fund manager James Anderson. While investors are worried about Tom Slater, James’ co-manager, taking over, the fund’s recovery from February to March this year proves that it is well-positioned to handle downfalls of similar nature.

Within a year, the fund also doubled its money after its holding company – Wise Plc (LON: WISE), a neobanking company, was listed on the London Stock Exchange (LSE) for a record £8 billion in the largest-ever listing of a tech company in the UK.

Scottish Mortgage Investment Trust has also been in the news for purchasing and selling its stake in TESLA and making a £72 million investment in the buzzing Blockchain.com, which accounts for less than 0.5% share in its holdings.

The company’s stock trades at GBX 1,321.00, down by 0.15 per cent, at 13:26 PM on 21 July 2021. In the last one year, the stock has gives a return of around 45 per cent.

Lloyds Banking Group Plc (LON: LLOY)

Lloyds Banking Group’s Moody’s long-term subordinate debt rating was upgraded from Baa1 to A3 and long-term senior unsecured debt rating from A3 to A2.

Earlier this month, Lloyds declared its foray into the private rental market. By the end of the next year, it aims to purchase over 1,000 residential properties as the company seeks out new opportunities to diversify income in order to offset extremely low interest rates. The bank quickly revived its internet and mobile banking services after reports that some users were unable to log in to their accounts through the website or phone app on 19 July 2021.

Lloyds Banking Group, for the first quarter ended 31 March 2021 registered a net income of £3,664 million, a decline of 7% year on year from the quarter ended 31 March 2020 of £3,952 million. The statutory profit before tax for Q1 2021 was £1,898 million, driven by positive business momentum and an improved economic outlook.

The company’s stock trades at GBX 45.36, up by 2.86 per cent, at 13:28 PM on 21 July 2021. In the last one year, the stock has given a return of around 49 per cent.

International Consolidated Airlines Group SA (LON: IAG)

International Consolidated Airlines Group SA, the parent entity of British Airways, has been impacted by the uncertainty surrounding domestic and international travel due to the sudden surge in the number of infections. Nevertheless, travel demand is expected to recuperate with improvement in vaccination rates.

Earlier in May IAG had informed European Commission (EC) about its Air Europa acquisition plans. A comprehensive enquiry was ordered by EC recently, regarding the compatibility of the deal on possible threat to lower competition in the Spanish passenger aviation market.

The EC put forth the challenges associated with assessing the impact of the pandemic on the country’s competitive air passenger transport market for the companies as well as competitors. The EC has thus not made any conclusions post its investigation and has until 5 November 2021 to conduct a complete examination to assess the feasibility of the transaction.

The company’s stock trades at GBX 168.38, up by 4.94 per cent, at 13:32 PM on 21 July 2021. In the last one year, the stock has given a return of over 16.00 per cent.

Comment


Disclaimer