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5pm: London closes lower
The FTSE 100 ended the session 21 points lower at 7,543, with investors aware that November’s uptick in GDP will be eroded in the December figures and growth is likely to slow this month.
IG chief market analyst Chris Beauchamp said the market points towards a further negative atmosphere as the second half of January gets underway.
Notable movers included Cineworld, which gained more than 4% after the cinema chain announced that it had generated positive cash flow in 4Q as revenue in December was lifted by a ‘strong’ box office performance from Spider-Man: No Way Home.
Electricals retailer Currys slid 6.85% after it reported a fall in sales over the peak Christmas period as a tough comparator year, uneven customer demand and supply disruption hit revenues.
Credit-checking firm Experian lost 2.41% even as it reported a 14% rise in third-quarter revenue, driven by growth across all geographical units as it lifted annual guidance.
Discounter B&M European Value Retail was 5.33% weaker after SSA Investments sold 40 million shares in the company – a 4% stake – in a placing.
Royal Mail slumped 5.53% after JPMorgan put the stock on its ‘Negative Catalyst Watch’ ahead of earnings in February.
7am: GDP likely to slip after November gains
The UK economy grew beyond pre-Covid levels for the first time in November, up 0.9%, which was higher than economists’ expectations and meant the economy was 0.7% larger than in February 2020.
However, growth is likely to have slowed in December after the spread of Omicron and the introduction of Plan Bmeasures.
Full story and analysis here
7am: Spider Man helps Cineworld
Cineworld said the new Spider Man move had helped it generated positive cash flow in the fourth quarter of 2021.
Full story and market reaction here
7am: Currys hit by chip shortages
Currys chief executive Alex Baldock said the electrical consumer goods chain gained market share, improved customer satisfaction, traded profitably, and can look ahead with confidence.
However, it has revised profits down over an erosion of sales.
Full story and analysis here
7am: Quiz pleased with margins
Clothing retailer Quiz said total Group sales in December increased by 20%, or £1.4m, to £8.8m compared to December 2020, in line with the board’s expectations.
Full story here
7am: Bellway chairman
Bellway has appointed John Tutte as non-executive chairman Designate from 1 March. He will succeed Paul Hampden Smith, who will retire from the board following almost nine-years’ service as a non-executive director.
Mr Tutte has more than 40 years of housebuilding experience, principally through various senior roles at Redrow.
Global markets
Asian shares were hit by more hawkish remarks after US Federal Reserve officials intensified expectations that interest rates could rise as soon as March, leaving markets braced for tighter monetary conditions.
Japan’s Nikkei gave up 1.3% while South Korea’s Kopsi dropped 1.4% after the country’s central bank raised its benchmark rate 25 basis points to 1.25%. Hong Kong’s Hang Seng index was off 0.9%.
Wall Street stocks fell back as investors digested the latest economic data including claims for unemployment benefits which unexpectedly jumped in the seven days ended 8 January but still remained low by historic standards and broadly in line with the pre-pandemic average of around 220,000.
At the close, the Dow Jones Industrial Average was down 0.49% and the S&P 500 was 1.42% lower while the Nasdaq Composite slid 2.51%.
“It is rare to see the Nasdaq under so much pressure compared to other indices, but the continued pricing in of tighter policy points towards an ongoing move away from high-valuation growth names and towards less-exalted sectors,” said IG chief market analyst Chris Beauchamp.
“Such a move should benefit the FTSE 100 overall, with its focus on raw materials firms that are less sensitive to inflation worries and on banks, where higher rates will come as a welcome change.”
