UK

Equity capital market participants were in a gloomy mood on Thursday as global equity indices fell in response to the pessimistic tone from the US Federal Reserve. However, European markets remain open for primary capital raising transactions.

HSBC and Standard Chartered are facing a backlash from investors and politicians after publicly supporting China’s planned security law for Hong Kong.

Ocado, the UK online grocery delivery platform, has raised £1bn by selling new shares and convertible bonds to fund its expansion plans amid a huge increase in demand for its services during the Covid-19 pandemic.

Tuesday proved to be another good night for UK primary equity capital raisings as Segro, the warehouse company, and insurance group Lancashire issued new shares.

Nationwide Building Society was able to tighten pricing by 50bp on the sale of an additional tier one bond on Wednesday, landing at a 5.75% coupon. The new issue will increase the bank’s leverage ratio, which went down last year amid a net redemption of tier one debt.

Whitbread, the parent of Premier Inn and Beefeater Restaurants, completed its £1bn rights issue on Wednesday, winning strong support from shareholders, who backed the company’s desire for expansion as the coronavirus pandemic recedes.

The UK Debt Management Office launched a syndication on Tuesday, printing a new October 2050 line and raising £9bn.

Convertible bond issuance in Europe is expected to pick up over the coming months as corporates in the region seek to exit from government lending schemes and refinance themselves via the capital markets.

The UK government’s steps to reopen its economy are proving a boon for Whitbread, the parent of Premier Inn and Beefeater Restaurants, which is set to complete a £1bn rights issue on Wednesday.

The surprising rise in global stock markets continued last week with a strong rally on Friday after US job figures were better than expected. The resilience of secondary equity markets, despite the Covid-19 pandemic, is a boost for those lining up equity block sales.

Stobart, the UK infrastructure and aviation company which owns London Southend airport and was a part owner of UK airline FlyBe, won wide support from equity markets on Thursday evening, giving the company the funds to manage through the coronavirus pandemic.

Rating agency Scope beat many European agencies to the punch in adopting new covered bond rating methodology in 2015, which is today considered a standard approach. But the European Securities and Markets Authority (Esma) is fining the agency on the grounds that it failed to apply it consistently and with the regulator’s permission.