London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Inflation has fallen from 3.2% to 2.3%.
GBP moving up against USD & EUR so supporting expected growth in summer travel away from 🇬🇧 ☔️ = lots of clothing purchases
Hopefully good for the markets today and for discretionary spend stocks like ASOS.
Still on the sidelines, but rooting for you current holders. Hopefully you can break above the 200 DMA and hold it this time. If you can, then I agree the short interest is likely to reduce considerably in the weeks ahead.
The macro picture remains poor, the national debt pile and public spending costs are frankly awful, thanks to the useless Hunts in Parliament.
But that is macro stuff. GLA.
Sterling strengthens as UK inflation rate falls by less than expected
The pound edged higher against the dollar on Wednesday after UK inflation figures came in higher than forecast.
Sterling rose 0.3 per cent to $1.2741 after official figures showed consumer prices rose 2.3 per cent in the year to April. The Bank of England and economists polled by Reuters had expected the headline rate to drop to 2.1 per cent.
UK inflation dropped less sharply than expected to 2.3 per cent in April, despite falling energy prices, denting expectations that the Bank of England will lower interest rates this summer.
The rise in the consumer price index was higher than the 2.1 per cent predicted by the BoE and economists polled by Reuters.
All going in the right direction, slowly but surely 😎
2.3% v expected 2.1% headline rate....who cares. Would they rather go back to 10% plus level again?
Should 2% be the long term target anymore? Interest rates way too low over past 15 years. Not an economist.....just putting across an alternative view
LWHL , what has national debt and Public spending got to do with the macro situation?
I'd be careful on those sidelines ;)
I find it interesting how every single 'negative' comment is being criticized / attacked. If national debt and public spending aren't considered macroeconomic issues, then what are?
I find it interesting that you keep commenting here negatively when you aren't invested. You still haven't answered the why? Otherwise, jog on.
I would get rid of the central bank, as well as the 2% inflation target. Inflation is a tax.
It is amazing how successful the establishment has been, in convincing 99% of the population that a 2% annual inflation target is something good to aim for.
Or that almost nobody seems to have considered that, after such a long period of high inflation, the idea of letting inflation drop below 2% for a while might be good for the people, to 'offset' the high inflation period.
Ah well, all we can try is to play the markets, not the macro. GLA.
Inflation is a positive compared to last month's report so no negatives on the inflation print.. it's simply coming down. Interest rates to follow :)
The media narrative will start to change, people will be brainwashed... I mean they will start to feel better and the likes of ASOS should start to benefit along with the continued turnaround of the business..
That's my point. Inflation came in higher than expected, market now pricing in a lower probability for 2 interest rate cuts this year hence GBP strengthening. You should get your facts straight and stop living in fantasy land.
I don't post positive or negative comments. I just give my opinion....
LWHL no comment.
Lollll ASOS price will increase because people with be brainwashed... great analysis!!! Great investment thesis!!!
My post was not a de-ramp here, jamesss. Merely a macro economic opinion, driven by facester's post, which caught my attention, along with their rhetorical question about whether we should revise the inflation target upwards.
FWIW, and because getting back to an average 2% inflation is probably not going to happen for a decade or more, it would not surprise me if 'they' did eventually suggest something like this and for that reason.
Anyway, I will not derail again.
You all should know I am fond of this one by now (albeit as a trader), so no more de-ramper accusations por favor :)
USA National Debt is 34 Trillion dollars.
It's a shame their economy is not flying and their indicies arnt making all time highs....
Robo you talk nonsense.
CPI has came in hotter by 0.1 % and your world is caving in ha ha.
LWHL are you serious about your comment that inflation won't come down to 2% for a decade or more? (hint: it's currently 2.3%)
LWHL I know you're not a de-ramper, I've read many of your posts.
I just can't agree that national debt is a driving factor for the performance of the Asos sp.
I also don't see how it will take 10 more years for inflation to come down by 0.3%?
I think the broader point about UK PLC is the anemic growth we've had for the last 15 or so years. So far, Brexit has been an economic disaster by almost any measure. This seems to me to be largely because of the way it has been handled by the various incarnations of government, but also the policy paralysis the country finds itself in. The UK needs a radical, sensible plan to drive growth and reduce debt.
However, as far as ASOS is concerned short-to-medium term, steady reduction in inflation and likely rate cuts in Aug/Sept/Oct, certainly won't do any harm. Sensible leadership will be gaming all kinds of scenarios in reaching a consensus on guidance.
I'm here for the long haul and I don't see a slightly higher than expected inflation print as derailing anything much.
GLA
What is needed now is
I dont see interest rates coming down as sharply as many expected at the start of 2024....and bond prices/yields seem to be adjusting to that
I said average 2%, jamesss and RL. Not the current number of 2%. If we see a 1% inflation print next month (we won't) - but if we did for arguments sake - then we will not be much closer at all to that 2% average.
I am too lazy to do the calculations for what would be needed to get us back to that 2% average, but I certainly would be interested to know if anyone else wants to crunch the numbers :)
Remember, the central bank mandate is to achieve an average of 2% inflation.
That is without even getting into the reeds on how inflation is calculated, which goods are included in the 'basket' (and which are omitted) for said calculations etc. Trustworthy or otherwise.
Again, you can drill pretty deep on that topic, too.
But ASOS, like all outfits, can only control what is in their power to do so.
What we do know, at the time of print, is that shorts are steadily unwinding here (on average, to slightly below average, volume) and the SP is reflecting this.
We know the level of inside buying from two of the big guns has been significant quite recently. Shame the CEO did not put his hand in his pocket, but that in itself is not a reason to be bullish or bearish. But it would have been another tick in the box, IMO. It is what it is.
I can tell you that the chart suggests a likely retest of the 50 DMA at this point. Beyond that, no idea.
For those with a long term horizon here, none of the above matters. Could it go bust? Sure. Could it multibag from here? Equally possible, certainly if they deliver on the plan and get that debt down. Which Barker and a few others appear confident they will, you would have to presume.
Lots of stocks could, and over the years ahead, no doubt many will, go bust, as they have since the first stock market exchange was established in Amsterdam in the 1600's (I think).
Anyway, that was a slight derail, but not entirely, so I hope I have not broken my promise :) And in fairness, it was largely a post made in response to some questions. GLA.
'I said average 2%, jamesss and RL. Not the current number of 2%. If we see a 1% inflation print next month (we won't) - but if we did for arguments sake - then we will not be much closer at all to that 2% average'
The obvious question If we are talking about averages is over what period of time?
I'm not having a go, I just don't agree with some things you say.
Meanwhile, whilst we're focused on the UK economic picture (which granted is important) the company itself seems to be broadening its horizons. A decent, multichannel footprint in India could be a game changer in years to come.
Patience should win out here.