The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.
The line between telecommunications and television companies has become increasingly blurred over the last few years and, considering recent moves made by BT, this certainly looks to be the case going forward. Throw into this mix the billions of pounds sitting in Vodafone’s bank account looking for a suitable home to invest in, and it is no surprise that these sectors have become more popular for investors to trade in.
Although the initial few months of BT’s strategy have proven successful, Sky has reported this morning that it has also managed to increase its broadband consumers, thanks to the Joanna Lumley advertising campaign. Tomorrow’s figures from BT will indciate if this was due to a generic growth of UK broadband users or if it was at the expense of BT. It is also worth remembering that a large number of BT Sport subscribers were already BT broadband users, so are not in fact new customers.
Figures for the company’s third quarter are expected to result in earnings per share of 0.066, with increased sales of £4.51 billion and a pre-tax profit of £671 million. It is worth noting that, over the last couple of years, BT has consistently managed to post figures that have come in better-than-expected.
With this in mind the 50-day moving average has been broadly supportive, and in the last 24 hours has been broken through. Over the last couple of months support has materialised around the 362p area – any break below this could trigger further sell-offs.