The FTSE 100 and FTSE 250 encountered divergent fortunes during early afternoon trading on Wednesday. At lunchtime the former was trading 0.09% lower at 7,124.13, whilst the latter edged 0.95% higher to 22,661.63.

The latest figures from the Office of National Statistics (ONS), revealed that gross domestic product (GDP) is estimated to have grown by 0.4% in August.

The rebound was predominately driven by the services industry, particularly travel agents and tour operators, where output soared 47.9 per cent. However on a more cautionary note the ONS revised down GDP growth for July from 0.1% growth to a 0.1% fall.

Inflation, supply chain issues and soaring fuel prices have dominated UK market chatter for months but on Wednesday investors were obsessed by THG (THG).

The online beauty and health products seller, also known as The Hut Group, continued to fall on after a torrid Tuesday during which it saw its share price lose more than a third of its value. A presentation to analysts and key investors designed to reassure about the long-term prospects for its Ingenuity e-commerce platform, spectacularly mis-fired with one newspaper reporting that the capital markets event was met with a ‘barrage of sell orders’.

An analyst who attended the event said they were left disappointed by the lack of financial detail put forward by the company.

The reset continued Wednesday with THG shares easing around 1.6% lower in the early exchanges to around 280p. This despite the company releasing a statement saying it ‘knows of no notifiable reason for the material share price movement, and that no material new information was disclosed at the event.’

Topping the better performers were housebuilders led by Barratt Developments (BDEV). It was up 5.8% to 679p after a reasonably upbeat trading statement that dragged the sector with it. Its sites have remained open despite industrywide problems sourcing materials.

Supplying the builders is a company called Brickability (BRCK:AIM), which earlier reported a 300% increase in its revenues. Its shares were up 2.4% to 104p.

DARKTRACE UPS GUIDANCE

Cyber security firm Darktrace (DARK) saw its share price rise more than 4.6% to 880p after revealing that it grew its customer base by 42.7% year-on-year in the first quarter to 5,975 customers.

Annualised recurring revenue (ARR) at 30 September 2021 was $381.5 million, up 45.9% on last year. Now expecting year-over-year revenue growth of between 37% and 39% (previously 35% to 37%) as FX headwinds look likely to have a smaller impact than had been previously forecast.

Online takeaways platform Just Eat Takeaway (JET) processed 266 million orders in its third quarter, representing a 25% increase compared with the same period of 2020, leaving investors disappointed.

The stock fell more than 4% to £52.66 despite the company reporting gross transaction value of €6.8 billion in the third quarter of 2021, up 23%. The company reiterated guidance for the full year 2021, implying order growth, excluding its US acquisition Grubhub, above 45% year-on-year.

Car dealer Vertu Motors (VTU:AIM) rallied 5% to 57.4p after posting half year adjusted profit before tax of £51.8 million, a steep recovery from last year’s pandemic-impacted £16.9 million.

The company said vehicle sales volumes were running ahead of market trends in all areas, echoing commentary from rival dealerships recently. Dividends also returned with Vertu set to pay shareholders a half year income of 0.65p per share declared.

ELSEWHERE ON THE MARKET

Hedge-fund manager Man Group (EMG) rallied 7.6% to 218p as it reported record funds under management for the September quarter, underpinned by fresh inflows into its funds.

Advertising company WPP (WPP) edged 0.04% higher to 983.6p following news that its Finsbury Glover Hering unit had agreed to acquire New York public-relations agency Sard Verbinnen & Co.

WPP said the deal valued the combined group at $917 million and Sard Verbinnen & Co at $303 million.

Pub company Marston’s (MARS) slid 0.14% to 72.7p despite it seeing a return to sales growth in the fourth quarter of its financial year compared to the same period in 2019 following an easing of lockdowns.

In a trading update for the year through 2 October, Marston’s said sales in the final three months of that year had risen 2% across its managed and franchised pubs compared to 2019.

SMALL CAP WRAP

Interior design and furnishings group Sanderson Design (SDG:AIM) dropped 5% to 200p even as it swung to a first-half profit after sales bounced back as lockdowns eased.

Sanderson Design, which said it was ‘mindful’ of cost and supply chain issues, reinstated its interim dividend at 0.75p per share.

Flooring retailer Victoria (VCP:AIM) gained 1.2% to £10.12 having upgraded its annual earnings guidance after benefitting from a rush of redecorating and a hot property market.

Victoria's underlying pre-tax profit for the year through 2 April 2022 would be ahead of consensus market expectations, the company said.

Footwear retailer Shoe Zone (SHOE:AIM) jumped 19% to 79p on guiding for a swing to a full-year profit following a recovery in sales in the second half and tighter spending.

Pre-tax profit for the year to 2 October would be no less than £6.5 million, Shoe Zone said in a trading update, compared to the £14.6 million recorded a year-on-year.

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Issue Date: 13 Oct 2021