FTSE 100 live: London markets make small gains with retailers in focus as sterling stays strong
Markets opened marginally higher on Friday with a mixed performance from retailers while the pound continued to strengthen as investors increasingly expect the Fed to start cutting rates across the pond.
The FTSE 100 opened 0.20 per cent higher at 7,859.58, while the domestically-focused mid-cap FTSE 250 index, which is more aligned with the health of the UK economy, rose 1.0 per cent to 19,254.33.
It was a mixed day for retailers in London. Electrical retailer AO World jumped over 11 per cent.
It forecast that its annual profit would be around the top of its estimates despite the challenging environment facing retailers. In a statement it said continuing macroeconomic uncertainty had not affected its trading in the last month of its financial year.
Hargreaves Lansdown’s Sophie Lund-Yates said: “This is a serious achievement given how tough the landscape is for bigger-ticket items at the moment, and speaks volumes on the group’s efforts to improve its proposition and cost profile.”
Superdry on the other hand slumped over 17 per cent as it issued a profit warning due to a “challenging environment”.
The firm has struggled amidst the cost-of-living crisis as consumers cut back on spending. Superdry said it might turn to the market to raise more cash.
“The group is walking down the right path as it tries to achieve long-term cost savings through its store estate and logistics, but cost savings can only carry you so far. At some point organic demand needs to carry the mantle,” Lund-Yates said.
Bootmaker Dr Martens posted small gains, rising 1.4 per cent, despite a smaller than expected revenue increase as it continues to face operational challenges in its US warehouses.
It lowered its EBITDA guidance as a result of the warehouse problems, but revenue from ecommerce and direct to consumer divisions grew.
The pound rose to $1.2526. The dollar has dropped in recent days due to easing supply constraints in the labour market and softer producer price inflation.
The pound meanwhile was supported by a speech from Huw Pill, chief economist at the Bank of England, which suggested a pause might be some way off.