Having opened lower, London’s FTSE 100 edged 15.1 points higher to 7,329.1 on Thursday as tension mounted ahead of the Bank of England’s latest interest rate decision and after last night’s rate cut by the US Federal Reserve left investors confused. While the cut was widely expected, the market doesn’t know what to make of split views in the Fed as policymakers in the committee failed to agree on economic conditions.
One of the day’s big stories involved retail bellwether Next (NXT), off 4.3% to £59.06 on profit-taking. Impressive first half results from the clothing and homewares colossus showed sales and profits progress with no change to full year guidance.
Investors were likely reacting to the absence of upgrades and the outlook statement, where CEO Simon Wolfson highlighted a disappointing first few weeks of the Autumn selling season blamed on a warm start to September.
High-flying retailer JD Sports Fashion (JD.) gave up 8p to trade at 704.4p as the Competition and Markets Authority (CMA) bared its teeth with plans to refer its investigation into the acquisition of Footasylum to a Phase 2 inquiry.
Executive chairman Peter Cowgill said: ‘Our discussions with the CMA are ongoing as we consider whether to proceed to Phase 2 or if acceptable remedies can be agreed at this stage.’
Alcoholic drinks giant Diageo (DGE) dipped 18.5p to £32.51 after it dampened down first half organic growth expectations and cautioned it ‘would not be immune’ from significant changes in global trade policy.
Online trading group IG (IGG) sparked up 8.3% to 626.4p on news of positive first quarter trading, with the company benefiting from growth in the number of active clients and increased client trading activity thanks to favourable market conditions in August.
Insurance sector services and technology solutions provider Charles Taylor (CTR) surged 36.6% higher to 321p after recommending a £261m takeover offer from Lovell Minnick, a bid pitched at a princely 34% premium to yesterday’s closing share price.
Elsewhere, indebted construction and infrastructure services group Kier (KIE) cheapened 7.5% to 122.2p on poor full year results showing a lurch into loss on flat revenue. However, the embattled company insisted it is ‘building firm foundations for the future’ under new management and highlighted a strong order book, ‘reflecting the strength of the underlying business, the quality of our people and the group’s capabilities’.
Productivity-enhancing instrumentation and controls play Spectris (SXS) sparked up 90p (3.6%) to £25.85 on the €319m sale of its BTG business to Voith. Spectris insisted the disposal is in line with its strategy to ‘simplify and focus our portfolio and to concentrate on developing our presence in specific high-growth end markets’.
Advanced security and surveillance systems developer Petards (PEG:AIM) slumped 18% lower to 16p after posting a drop in first half profits. Management also warned it now expects to return ‘a satisfactory, albeit lower than previously anticipated, performance for 2019 weighted towards the second half of the year’.