Anglo American hits pay dirt after resisting rivals’ push for payouts

ANGLO AMERICAN

bounced back from a near three-month low after City scribblers praised the metals giant for focusing on growth and resisting the trend to hand out bumper shareholder payouts.

The miner has been restrained compared to its FTSE 100 rivals that have showered investors with cash payouts and even trimmed its dividend in February.

Anglo is “differentiating itself from peers by focusing on high-quality organic growth” over shareholder returns, Credit Suisse argued. Its projects “move the needle” and will drive volumes growth well above that of its rivals, it predicted. The bank raised its target price for Anglo by almost 50pc and upgraded the miner to its “outperform” list. Its shares jumped 45.2p to £19.81.

Elsewhere, global markets ended the week on the front foot following another hiring bonanza in the US.

Unemployment fell to 3.6pc, its lowest level in half a century, but wage growth remained steady despite the tightening labour market. Stocks rallied following the “goldilocks” jobs report but their gains were trimmed by a services sector gauge in the US slipping to its lowest level since August 2017.

Wall Street snapped a two-day losing streak to rise back towards record highs while the FTSE 100 rebounded from a onemonth low. The index gained 29.33 points to 7,380.64.

Grocery tech giant Ocado pulled away from a onemonth low after Peel Hunt told clients that its automated warehouses are

far more technologically advanced than Amazon’s.

Analyst James Lockyer came back from a visit to Amazon’s most advanced warehouse in Europe “underwhelmed” and “even more positive for Ocado”. The visit “gives us confidence in Ocado’s moat, even to Amazon at this point”, he said, lifting the star stock 35p to £13.81.

Airlines easyjet and British Airways owner IAG flew lower after rival Air France-klm’s losses widened during a “challenging” first quarter, dragging shares down across the sector. It blamed higher fuel costs and fierce price competition for the ballooning losses as easyjet dropped 24p to £11.17 and IAG slid 11p to 525p.

Holiday Inn owner Intercontinental Hotels

edged 54p lower to £49.44 as its revenue per available room growth slowed sharply to 0.3pc

RBC Capital Markets told clients that the hotel giant’s worst quarter since 2010 “follows on from disappointing revenue per available room generally in the sector”.

Admiral and Direct Line reversed after UBS delivered the insurers a pair of downgrades, warning that motor insurance pricing has “disappointed” in 2019 and margins are under pressure. Competition has been “more severe than expected”, driven by mid-market rivals, UBS argued, cutting Admiral to “sell” and Direct Line to “neutral”. The downgrades knocked the insurers 8p to £21.79 and 3.8p to 320.5p, respectively.

The Swiss bank also put shares in asset manager

Schroders under pressure with a downgrade to “neutral”, arguing that ordinary investors have continued to yank money out of its funds. Schroders clawed back early losses to gain 4p to £31.62.