Market report

London rises | EasyJet | Diageo | Menzies


5pm: London outperforms Europe

London’s blue chip index recovered from an early wobble to take a more hawkish than expected US Federal Reserve statement in its stride.

The FTSE 100 closed up 84.53 points, or 1.1%, at 7,554.3, as its more internationally-exposed constituents outperformed other European bourses thanks to a weaker pound.

Drinks giant Diageo rose 2.5% as it delivered strong net sales growth during its first half year.

Bootmaker Dr Martens was the worst mid-cap performer, falling 9% after it said wholesale sales had dropped in its financial third quarter, though revenue grew overall from the previous year.

On AIM, Fevertree fell 8.5% despite delivering an “excellent” performance in 2021 with strong growth across all its key markets.

8.10am: TSB swings into profit

TSB swung back into profit last year following a focus on cutting costs and increased lending but said growing pressure on household incomes may impact on the appetite for mortgages

Statutory profit before tax for the year to the end of December came in at £157.5 million against a loss of £204.6m last time.

Full story here

7am: EasyJet cuts losses

EasyJet cut first-quarter losses by half as Covid-19 travel restrictions were eased and bookings rose.

The company reported a headline loss before tax of £213m for the quarter ending 31 December, compared with £423m a year ago.

Chief executive Johan Lundgren said: “We see a strong summer ahead, with pent up demand that will see easyJet returning to near 2019 levels of capacity with UK beach and leisure routes performing particularly well.”

Cash burn was more than halved at £450m.

7am: Diageo sees strong growth

Whisky and beer giant Diageo said net sales for the first half to the end of December came in at £8 billion, an increase of 15.8%, with strong growth across its portfolio

Full story here

7am: John Menzies

Airport logistics business John Menzies said overall trading through the latter part of Q4 was in line with the board’s expectations.

Despite the impact of changing travel restrictions related to the Omicron variant, the business saw strong performances from a number of services lines which, together with continued productivity gains, saw the group finish the year strongly.

Cash generation has also remained positive, with the group retaining a strong liquidity position and year end net debt in line with expectations.

“Commercially, the excellent performance in 2021 has continued with further contract wins and renewals. Looking at the year ahead we remain confident in our current projections for a continued recovery of global flight volumes.”

Global markets

Spread betters were expecting the FTSE 100 to give back all of yesterday’s gains and more after US Federal Reserve chairman Jerome Powell signalled a rise in interest rates in March and prompted a sell-off in US and Asian shares .

A 130 point loss on London’s blue chip index would wipe out all of Wednesday’s 98-point gain to 7,469.

There was no change to policy at the Fed’s two-day meeting but comments afterwards by Mr Powell said tougher action could be imposed to keep inflation under control.

US bond yields rose sharply and stock markets fell. After a bright start, the Dow Jones Industrial Average closed down 0.38%, while the S&P 500 lost 0.15% and the Nasdaq Composite clung to a gain of just 0.03%.

Asia-Pacific shares tumbled across the board. The Nikkei in Japan and South Korea’s Kospi both plunged more than 3%.

China’s Shanghai Composite fell 1% while Hong Kong’s Hang Seng index slumped 2.55%.

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