Stocks trend as manufacturing output slows

Inflationary pressures as well as the disruption in supply chains due to the Russia-Ukraine conflict have impacted the UK manufacturing sector. In the quarter to July, industrial production grew at the slowest pace in over a year, despite a slight pick-up in investment.

The Industrial Trends Survey, a quarterly survey by the Confederation of British Industry (CBI), showed that the output balance fell to +6% in July from +25% in the three months to June. This is the lowest growth since April 2021, but still above the long-term average growth of +2. A similar rate is expected in the quarter through October, CBI said. The survey is based on responses from 237 manufacturing companies.

Image Credit: GH Studio, Shutterstock

The latest numbers showed a more typical rate of expansion after a period of solid growth compared to last year.

Average costs also registered a slower growth rate of +82% during the period compared to +87% in the previous quarter. This growth is expected to slow further to +77% in October. In addition, domestic price growth also fell to +51% in July, from +60% in April.

On the other hand, investments in this sector increased in July compared to April, while employment recorded a slight decrease to +18% compared to +21% in April.

Following that news, here’s a look at three London-listed manufacturing stocks.

Anglo American plc (LON: AAL)

Anglo American is a leading British mining company producing platinum, diamonds, copper, iron ore and other metals. With a market cap of £35,653.14 million, the company’s shares were trading at GBX2,719.00 as of 12:57 GMT+1 on Monday, up 2.01%. The stock’s value is down 8.15% over the last 12 months and 9.62% year-to-date. Earnings per share currently stands at 6.93.

Premier Foods Plc (LON:PFD)

The British food manufacturer has popular brands such as Cadbury and Mr Kipling in its portfolio. The company has acquired Indian and Thai recipe kit maker The Spice Tailor for £43.8million. The constituent of the FTSE 250 has a market cap of £975.40m and has given investors a return of 6.36% over the past year. Earnings per share are currently at 0.13 and shares were up 3.54% at GBX 117.00 as of 13:06 on July 25.

Croda International (LON: CRDA)

Croda International manufactures specialty chemicals and is a member of the FTSE 100 Index. The stock is down 12.37% over the last 12 months while the year-to-date return is -31.20%. Shares of the company were trading at GBX 6,946.00 as of 1:09 p.m. Monday, down 1.48%, with a market cap of £9,844.30 million.

Note: The above content represents a very preliminary observation or view based on market trends and is of limited scope without an in-depth fundamental assessment or technical analysis. Any interest in stocks or sectors should be carefully considered taking into account the risks involved.

Leave a Comment