United Kingdom

STOCKS TO WATCH: 'Short haul' ride leaves easyJet feeling queasy

The announcement of the reopening of flights to the US last week encouraged investors to climb back aboard airline stocks after the latest bout of Covid turbulence for the sector. 

Short-haul operator easyJet was among the beneficiaries and hopes of a takeover have also boosted sentiment. 

An offer from Hungarian low cost carrier Wizz Air has already been snubbed. 

Turbulence: A £1.2billion rights issue to raise cash to pay down debt and make investments, potentially in more aircraft, has shaken some confidence

However, a £1.2billion rights issue to raise cash to pay down debt and make investments, potentially in more aircraft, has shaken some confidence. It also appears to have tempted in a clutch of hedge funds hoping to profit from a fall in the share price. 

Short sellers, including AQR Capital, LMR Partners and Gibraltar-based Guevoura, have upped their bets against the airline in recent days. 

The company is now the fourth most shorted FTSE stock with 6.2 per cent of the shares out on loan according to ShortTracker. 

Brace, brace.

Holidaymakers shunning breakfast booze 

The taste of a 6am pint in an airport Wetherspoons may be synonymous with holidays for some, but analysts warn not enough are back on the breakfast booze. 

Broker Peel Hunt says airline passenger volumes are still at 65 per cent of pre-pandemic levels, weighing on the pub chain's earnings. 

This week's results should give an idea whether the dent, and rising costs, are likely to hit profit expectations. 

McCabe faces rough ride at AO World AGM 

AO World's Shaun McCabe could face a rough run through the spin cycle at the washing machine seller's annual meeting this week. 

Shareholder adviser Glass Lewis has urged investors to vote against the reappointment of McCabe to his role as a non-executive director. 

McCabe is also on the board of Boohoo – whose governance has been in the spotlight over allegations of slave labour – and is chief finance officer at Trainline, which saw shares punctured by a rail review this year. 

Glass Lewis argues McCabe is overstretched and should retain 'some spare capacity in case of a crisis'. 

With AO shares down 45 per cent this year after last year's Covid rally, perhaps that time is imminent. 

Lord Wolfson set to present Next results 

Expect Lord Wolfson to provide a typically grounded view amid the chaos when he presents first-half results for Next this week. 

The Tory peer has developed a reputation for calm prognosis, which could prove handy amid freight woes, labour shortages and environmental concerns in the retail trade. 

Strong online trading has pushed the fashion flogger's shares to near all-time highs, and investors will be keen to assess the outlook for the dividend. 

The City favourite has just paid out £140million to shareholders and a £100million payout is due in January, provided Christmas goes to plan. 

Annual profits are expected to hit £750million, so the payouts should keep rolling off the shelves. 

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