Morrisons in play? RSA tops FTSE100 risers
Thur: Morrisons reported another fall in sales, prompting analysts to wonder when, and if, chief executive David Potts will be able to turn the business around before it becomes a target.
Shares in the supermarket chain fell 5.63% to 167.5p, one of the biggest slides of the day, as nerves crept in among investors.
John Ibbotson of the retail consultants Retail Vision said: “To claim you are making good progress on the back of these numbers is bordering on the delusional.
“David Potts has been in charge for nine months now but his turnaround plan isn’t working. He can’t blame it all on food deflation, either, because that’s happening to all the supermarkets. In fairness, Potts is doing as well as anyone probably could but he has arguably received one of the biggest hospital passes in UK retail history.
“It’s hard to see Morrisons ever making a full recovery, and it’s potentially ripe for takeover. Only question is, who will buy it? It lacks the size and profitability of Tesco, has lost its price perception to ASDA and can’t compete with the quality and service standards of Sainsbury’s.
“Having a high cost internet operation run by Ocado doesn’t help, either.”
Insurer RSA topped the FTSE100 risers after chief executive Stephen Hester said progress was being made in reviving its performance. Shares closed up 3.4% at 429p.
Stocks fell in afternoon trade despite the Bank of England holding interest rates steady, prompting investors to push back expectations for a rate hike. The FTSE100 ended the session lower by 0.75% or 47.98 points at 6,364.9 after an initial run higher.
UK house prices jumped by 1.1% month-on-month in October, according to the latest tally from Halifax.
However, there was a setback for the car industry as the Society of Motor Manufacturers and Traders (SMMT) said new car sales in Britain declined 1.1% year-on-year in October, the first decline in 43 months, as 177,664 new cars were registered last month.
Travel company Thomas Cook suffered after the UK government decided late on Wednesday to ground all UK-bound flights from Sharm el-Sheikh in Egypt following the Russian plane crash in the Sinai desert last week. Investors were concerned that the move could reduce demand for holidays in Egypt.