Market Round-Up

With the FIFA Women’s World Cup concluding on Sunday 20th August, it would be fitting to note the seismic impact the tournament had on the sports industry and broader economy. The 2023 edition of the tournament has been the most successful one so far, generating revenues to the tune of US$570m as interest in the women’s game continues to grow. 12 million UK viewers watched the final as England’s Lionesses gripped the nation with a valiant performance, prompting an uptick in retail and pub sales. A VoucherCodes report estimates that the final alone boosted the UK economy by £185m.

The tournament’s global reach and ability to attract high value-sponsors, highlighted the growing monetisation opportunities the sport can bring, which is set to catalyse the development of the female game. The enthusiasm and fanfare the competition generated has compelled authorities to invest resources into the sports, with the Australian Government pledging to spend A$200m (US$128m) on football infrastructure and facility upgrades. Additionally, the fervour has further accelerated the formation of women’s clubs and expansion of domestic leagues. This trajectory is projected to benefit the industry as a whole with the recent launch of female sides by teams like Real Madrid and Manchester United expected to increase brand awareness and merchandising sales.

The major hurdle is the differing rate at which these developments occur, with certain national football federations lagging behind others. However, upsets in fixtures across the 2023 World Cup has shown that the performance gap is closing. Thus, we can expect the women’s game to continue thriving and leave its mark on the sporting world for many years to come.

September is set to be characterised by the largest Initial Public Offering (IPO) since 2021 as UK-founded Arm is set to list in the United States. But while the company is looking to raise around US$60-70bn from the IPO, the decision for a UK company to list stateside over its home market has more meaning than many may expect. The UK stock market has been characterised by large trading discounts for years, suffering from poor sentiment and significant outflows of domestic capital abroad, with pension schemes holding almost 30% of their assets overseas. Therefore, listing in the UK would likely harm Arm’s valuation. The US listing is expected to provide Arm with better access to a much deeper source of capital as well as the ability to benefit from its tech counterparts in the index. 

Asda, the Leeds-based supermarket giant, has recorded revenue growth of 9.6% on the previous year for the April to June 2023 period. This result has largely been attributed to the success of Asda’s own brands, particularly the Just Essentials range - the company’s lowest priced product line. Just Essentials now represents 20% of Asda’s market share, after year-on-year sales almost doubled this quarter, highlighting changing consumer preferences as high inflation and cost pressures persist.

Mohsin Issa, the retailer’s co-owner, acknowledged that “thousands of families continue to struggle with the cost of living”, with the business placing greater emphasis on providing affordable food, clothing and homewares. The firm has also established a strong online presence, becoming the UK’s second largest online grocer, which places it in a favourable position to capitalise on the shift of UK consumers to e-commerce and value products.

Please note that this communication is for information only and does not constitute a recommendation to buy or sell the shares of the investments mentioned. The value of investments and any income derived from them may go down as well as up and you could get back less than you invested.