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London open: Retail stocks help FTSE 100 jump 1.2% early on
London’s FTSE 100 surged in early deals on Monday, with just six stocks on the top-tier index trading in negative territory, as markets edged closer to their all-time highs ahead of a busy week.
The FTSE 100 was trading 1.2% higher at 7,988 by 0828, rising for the fourth straight day as it closes in on the 8,015.63 record closing high reached earlier this month. The index was faring better than the rest of Europe, where the pan-European Stoxx 600 index was up just 0.3%.
The Footsie’s recent outperformance has come despite a turbulent time across global financial markets over the past week, with investors starting to question sky-high valuations in the tech sector following eye-watering gains for any companies in the AI space.
“Recent comments coming out of the semiconductor sector have raised some concerns that the current expectations for limitless growth may have been overdone,” said Richard Hunter, head of markets at Interactive Investor.
“Given its lesser reliance on tech stocks, the FTSE100 powered ahead in early exchanges, in an echo of the market moves of 2022 when high growth shares were eschewed in favour of more stable, defensive and value stocks, all of which are to be found in abundance in the UK’s premier index,” Hunter said.
The economic data schedule looked relatively light on Monday, with eurozone consumer confidence and the Chicago Fed National Activity Index the only major releases of the session. However, things will pick up later in the week as US corporate earnings get into full swing, along with some important economic indicators.
Tuesday will also see a barrage of manufacturing surveys across Europe, the UK and US, followed by key US GDP and inflation figures on Thursday and Friday, respectively. Meanwhile, tech blue chips Tesla, Alphabet, Microsoft and Meta will report their latest quarterly figures in the coming days.
Hunter said that, given the “stretch valuations” in the tech sector following year-to-date gains, “any earnings misses or cautious guidance statements [are] likely to be punished”.
Retailers gain, Tyman jumps
Retail stocks were performing well early after positive comments from RBC Capital Markets, which said that spending on travel, entertainment and clothing is likely to pick up. Marks & Spencer was among the biggest risers after RBC said the stock is its top pick in the sector “given it should be able to deliver moderate growth driven by structural improvements in food and womenswear”.
Others in the sector, such as Ocado, Sainsbury, B&M, Tesco and Next were also putting in a decent performance.
Tyman shares jumped 27% after the company agreed to be bought by US metal window and door manufacturer Quanex in a £788m cash and stock deal. Nicky Hartery, non-executive chair of Tyman, said: “This transformative and complementary transaction will strengthen the enlarged business for the benefit of all our customers, employees and other stakeholders.”
The saga at Hipgnosis Songs Fund took a new twist on Monday when private equity outfit Blackstone made a potential $1.5bn offer to buy the troubled music rights investor, setting up a bidding war with Concord Chorus. Shares were up 10% early on.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Ocado Group Plc | +5.39% | +18.70 | 365.90 |
| 2 |  |
Sainsbury (j) Plc | +3.63% | +9.40 | 268.20 |
| 3 |  |
Marks And Spencer Group Plc | +3.30% | +8.10 | 253.90 |
| 4 |  |
Persimmon Plc | +3.03% | +39.00 | 1,325.00 |
| 5 |  |
Tui Ag | +2.79% | +16.00 | 590.00 |
| 6 |  |
Tesco Plc | +2.70% | +7.60 | 289.00 |
| 7 |  |
International Consolidated Airlines Group S.a. | +2.51% | +4.25 | 173.75 |
| 8 |  |
Associated British Foods Plc | +2.49% | +61.00 | 2,508.00 |
| 9 |  |
Hargreaves Lansdown Plc | +2.39% | +17.20 | 735.40 |
| 10 |  |
Hsbc Holdings Plc | +2.38% | +15.40 | 661.60 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Fresnillo Plc | -2.74% | -16.50 | 585.50 |
| 2 |  |
Sse Plc | -0.99% | -16.50 | 1,644.00 |
| 3 |  |
Anglo American Plc | -0.39% | -8.50 | 2,170.50 |
| 4 |  |
Flutter Entertainment Plc | -0.37% | -55.00 | 14,785.00 |
| 5 |  |
Centrica Plc | -0.30% | -0.40 | 131.30 |
| 6 |  |
Crh Plc | -0.19% | -12.00 | 6,240.00 |
| 7 |  |
Shell Plc | -0.00% | -0.00 | 1,894.60 |
| 8 |  |
Just Eat Plc | -0.00% | -0.00 | 861.00 |
| 9 |  |
Nmc Health Plc | -0.00% | -0.00 | 938.40 |
| 10 |  |
Intertek Group Plc | +0.00% | +0.00 | 4,906.00 |
Monday newspaper round-up: Renewable energy, BlackRock, Frasers Group
A development company that sells off land no longer needed by Thames Water has paid out a £14m dividend despite warnings that it could become engulfed by the water group’s financial woes. Accounts filed at Companies House show Kennet Properties paid out a £14.5m dividend in the year to 31 March 2023 despite the difficulties faced by the wider group, which is facing going into administration. – Guardian
A permanent shift to higher interest rates could add billions of pounds to the UK’s renewable energy transition, a leading thinktank has warned. Borrowing costs have soared since the easing of pandemic lockdowns and Russia’s invasion of Ukraine as the world’s leading central banks raised interest rates to tackle inflation – pushing up the costs of investment in infrastructure across advanced economies including for green power generation schemes. – Guardian
BlackRock spent nearly $800,000 (£647,000) last year on security for its chief executive Larry Fink following a backlash by activists over the company’s “woke” stance on investing. The world’s biggest asset manager spent $564,000 upgrading security systems at Mr Fink’s home and $217,000 on bodyguards in 2023, according to a filing earlier this month that was first reported by the Financial Times. – Telegraph
Mike Ashley’s Frasers Group has refused to allow the Financial Reporting Council to publish the key findings of a review into the retail group’s latest annual report. Frasers, which has a history of corporate governance controversies, has withheld consent for the regulator to issue a case summary after entering into “substantive inquiries” with the company. – The Times
Only 1 per cent of local government accounts were audited on time last year and there are now almost 800 accounts awaiting an audit opinion, with the delays affecting the sign-off of the accounts of several government departments. Since 2015, when the Audit Commission which used to manage the auditing of English councils’ accounts was abolished, audit appointments have been contracted out to the private sector, with every account being reviewed by either Deloitte, EY, Grant Thornton, Mazars or BDO. – The Times
