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There was so much going on today, I couldn’t settle on just one item. Instead, I thought I would highlight what has been happening to the share prices and the shareholders of Rolls Royce (LSE:RR.), Tesco (LSE:TSCO), Royal Bank of Scotland (LSE:RBS) and Tencent Holdings (HKX:700).
Rolls Royce
Shares in Rolls Royce gained 2.2% to close at 1,069.00, up 23.00 on the day just minutes after touching 1,074.00. The Rolls share price had suffered in the last two weeks after news broke that Emirates airline had cancelled an order for Airbus 350s that come equipped with Rolls Royce engines.
Today’s news that Airbus is planning to upgrade its A330 models to include Rolls engines exclusively gave the company the kind of boost the investors wanted to see, as it also helped the FTSE 100 remain stable despite a rather flat day otherwise.
Tesco
Why watch the World Cup when you can watch a live-streaming telecast of Tesco’s AGM? (Not that there are that many Brits still interested in the cup at this point. Wink. Wink. Nudge. Nudge.) With obvious opposition to Philip Clarke, the CEO still managed to retain his position despite a fiscal year that could be politely described as dismal.
It’s not that shareholders didn’t know what was coming. It’s just that they enthusiastically demonstrating their lack of enthusiasm with Clarke’s performance. (Tesco investors must not hold any banking shares or we would have seen greater unrest in that sector for the past few years). Despite what appears to be a solid rebuilding strategy proposed by the board, some investors seem likely to want to compare Clarke’s appraisal of the situation to Syria’s President Assad saying, “What war?” Tesco shares dropped 0.51% to 283.75.
Royal Bank of Scotland
Does anybody really call it that anymore? Rumor has it that RBS really stands for Robbing Brit’s Savings, but I try to avoid the rumor mill. CEO Ross MeEwan announced today that RBS plans to begin closing 100 branches in the UK in addition to the 310 that will be spun off in 2016. That will reduce the net total RBS branches from 1,900 to 1,490, and McEwan seemed to indicate that would not be the end of it.
RBS shares closed up 0.7% to 327.00 following its AGM, perhaps indicating that the banks investors see the move as not simply trimming fat, but actually trimming off dead wood. Despite the complaints of groups like the Campaign for Community Banking Services (CCBS) who said that “The bank has absolutely no excuse for doing this to communities,” the move is likely to become a jewel in McEwan’s crown as one of the most visionary cost-cutting campaigns in banking history.
The branches that will be closed are primarily in rural communities where business is slow in any sector. RBS is refocusing its business on the burgeoning online banking format, which ultimately means that the blokes over at the CCBS will have no jobs. No wonder they are complaining. They are afraid of the future.
Tencent Holdings
Ignore China and suffer the consequences, especially when it comes to the internet and technology. Tencent is the fifth-largest internet company in the world, following Google, Amazon, eBay and Facebook, in that order. Its market cap is $1.1 trillion. with 9.34 billion shares outstanding.
Tencent shares were trading at 108.00 on 05 June, but have been on the increase in the ensuing days. In what is now yesterday in Hong Kong, Tencent’s share price closed at 118.40 upon news that it is spending $736 million to acquire a 19.9%share in internet classified ad company 58.com (HKX:WUBA), thereby broadening the company’s growing offerings.
Now, if you will excuse me, I have to get ready to watch the U.S. play Belgium in the second round of the World Cup, something that even my grandfather did not see. On the other hand, my grandfather didn’t own a TV, so he really didn’t know what he had missed.
