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Feels fine when markets drop some days. Imagine if markets went only up everyday :-)

Here’s what the AI (perplexity) comes up with -

Why didn't the market react with a larger share price increase after the SMR win

Several factors may explain why the market didn’t react with a much larger share price increase for Rolls-Royce after the SMR win:

• Market expectations already priced in: If investors widely anticipated Rolls-Royce winning the SMR bid, the positive news could have been largely reflected in the share price before the official announcement, limiting the upside on the day.

• Perceived risks and long-term uncertainty: While the SMR project is positive, investors may be weighing execution risks, regulatory hurdles, and the long timeline for project delivery and profits. These uncertainties can temper the immediate share price reaction.

• Broader market and sector conditions: Share prices are influenced by overall market sentiment and sector trends, not just company-specific news. If the broader market or industrial sector was weak or volatile, this could have dampened the impact of the SMR win.

• Technical factors and liquidity: Large-cap stocks like Rolls-Royce are heavily transacted, so news impact can be absorbed quickly and may not always trigger dramatic short-term moves.

In summary, the market likely saw the SMR win as a positive but not transformative event in the short term, especially if some of the upside was already priced in.

For some reason most major aerospace and defence stocks having a very bad day. I looked at a few and they were down 4-8%, like GE down by 4.5%.

If we are down by less than a percentage, means we are up today by 3-4%.

Hopefully tomorrow better day for all.

880 close

There may be some selling pressure today who may have been waiting for months, or a year, wanting to sell this after the SMR news. To book a profit or needed money or any other reason. We are hopefully done with those sales and look forward to steady rise from here. GLA

Even BAE suddenly dropped by that much. Could be some news impacting the sector?

Defence sector down in Europe impacting RR.

Buybacks aren’t needed imo. They could use the money for R&D and come up with more world beating engines and other products.

Funding*

Since the infra investments are going to come out of extra borrowing over the long term seems finding not a deal breaking constraint.

Seems per SMR 15 -20 p.

Else doesn’t look logical to bounce 20p for 20 SMRs,

which would be just 1 p per SMR :-)

Confluence

“Analysts expect £10 by end of year…“

From the link given, it’s not £10 by the ends of year but says “this year”. End of year is £12+ imo

Maybe it’s highly ‘price sensitive’ issue and they want to guard the secret and anything related to it

due to fears of insider trading laws.

No recent comment from Govt or Great British Nuclear that winners will be announced on 11th June.

The intrinsic value from Simply Wall st is 11.33 using DCF calculation which probably doesn’t factor in SMRs.

So we could be about 25% undervalued even without SMR.

Https://finance.yahoo.com/news/constellation-energy-stock-soars-on-20-year-nuclear-energy-deal-with-meta-135514581.html

Tim

130000+ shares is already more than a million.

One needs about 112000 shares for a million at today’s share price.

Seems it’s not practical for retail investors. Here’s what I learned from ChatGPT

“Yes, in theory, you can make a gain from arbitrage between a London-listed share and its ADR listed on the Nasdaq, but in practice, it’s difficult for retail investors to profit from this due to several key barriers.

⸻

🔁 How Arbitrage Would Work

Let’s say a UK company is listed on the London Stock Exchange (LSE), and its ADR is listed on the Nasdaq.

You notice:

• LSE price: £10/share

• ADR ratio: 1 ADR = 2 ordinary shares

• Implied ADR value: £20 = ~$25 at exchange rate 1 GBP = 1.25 USD

• Actual ADR trading at: $27 on Nasdaq

This suggests a $2/ADR arbitrage opportunity.

⸻

🚧 But Here’s Why It’s Difficult

1. Transaction Costs

• Forex fees (GBP/USD)

• Trading commissions on both exchanges

• ADR conversion and cancellation fees

• Spread between bid and ask prices

2. Timing and Settlement Delays

• London and Nasdaq operate in different time zones.

• Settlement times vary (T+2, etc.), making quick arbitrage hard.

3. Access and Regulations

• Some brokers don’t offer cross-market or ADR conversion services.

• Regulatory issues might apply, depending on domicile and tax treaties.

4. Professional Arbitrageurs

• Institutional investors with algorithmic systems already exploit most inefficiencies instantly, leaving no spread for retail investors.

⸻

✅ When It Might Work

You might still capture value if:

• There’s temporary dislocation due to news in one market (e.g., UK holiday but US markets open).

• You’re holding ADRs and can convert to local shares (or vice versa) during such mismatches.

• You’re a sophisticated investor with access to both markets, low fees, and fast execution.

“ Trading at £9+ (equivalent) in US”

Isn’t there an opportunity to make an arbitrage gain. Buying at LSE and selling RYCEY?

These days usually goes high near the closing bell. So I’m guessing 898.40

Yes, it makes good sense for the Govt to keep the two announcements separate to draw some political mileage out of it.