London’s FTSE 100 was broadly flat at lunchtime on Tuesday, off 0.09% at 6,565.7 points with the blue chip benchmark showing resilience in spite of a new national lockdown in England as investors looked towards what support for businesses Chancellor Rishi Sunak could announce.
Prime Minister Boris Johnson last night announced another lockdown with schools closed and stay-at-home orders issued, as the new variant of coronavirus takes hold. The lockdown is expected to last until at least mid-February.
Businesses have called for further help amid the new lockdown, and Sunak is reportedly set to provide a fresh package of support for struggling firms.
Shares in Royal Dutch Shell (RDSB) rose 2.7% to £12.92 despite a fall in oil prices after producers’ cartel OPEC and its affiliates failed to come to a consensus on production curbs at their meeting yesterday.
NEXT, MORRISONS SEE STRONG FESTIVE SALES
Clothing retailer Next (NXT) jumped 6.2% to £73.36 as the retail bellwether reported better than expected festive sales for the nine weeks to 24 December, with full price brand sales down 1.1% year-on-year, much better than the central guidance of -8% outlined in its third quarter trading statement in late October.
The company highlighted that with the benefit of better sales in November and December it now expects full-year pre-tax profit of £370 million.
This however includes two non-recurring items (a 53rd week benefit of £12 million and a new additional property provision of £40 million) meaning that total full year profit is forecast to be £342 million, compared to guidance range of £290-400 million given in late October and analyst estimates of £280 million.
Supermarket Morrisons (MRW) softened 0.4% to 180.35p despite saying group like-for-like sales excluding fuel have improved by 7.3% so far in its four quarter, driven by sales over Christmas and New Year.
Overall sales rose by 9.3% in the three weeks to 3 January, compared with the same time last year, as shoppers moved early to secure their supplies for the festive period amid restrictions.
The supermarket said like-for-like sales ex-fuel was 7.1% in the third quarter, which has then increased to 7.3% for the nine weeks of its fourth quarter to date.
IT infrastructure provider Softcat (SCT) surged 8.6% to £15.21 as it said in a brief trading update that with the seasonally important December trading period now behind it, the firm is ‘significantly ahead of where we expected to be at this stage.’
The firm said trading has continued to be ‘positive’ since its first quarter update on 16 November, with demand from its public sector customers remaining ‘strong’.
Fuel distribution group DCC (DCC) gained 0.8% to £53.82 as it completed the acquisition of United Propane Gas, ‘materially’ expanding its presence in the US liquified petroleum gas (LPG) market.
UPG becomes DCC LPG’s largest acquisition since initially entering the US market in April 2018 and followed the bolt-on acquisitions of NES in September 2020 and Pacific Coast Energy in April 2019, the company said.
The acquisition is set to expand DCC LPG presence in the US from 14 to 21 states, and will almost double its customer base to over 230,000 customers, with the deal creating the sixth largest business in the ‘highly fragmented US LPG market’, the firm added.
Balfour Beatty (BBY) rose 1.2% to 274.4p after the construction group said it expected to complete its previously announced initial £50 million buyback programme by the time it releases 2020 full-year results on 10 March 2021.
Paper and packaging company Mondi (MNDI) was marked up 3p to £17.55 after agreeing to acquire 90.38% of the outstanding shares in Turkey-listed corrugated packaging player Olmuksan for €66 million.
Iron ore producer Ferrexpo (FXPO) gained 4.6% to 309.8p as it declared a special interim dividend of 13.2 US cents following ‘strong’ operational and financial performance in 2020.
