Daily Business Live
US job figures ‘diabolical;’ M&S hit; Barratt divi restored
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4.30pm: London gains
The FTSE 100 ended the first week of the year with five straight gains, up 16.3 points at 6,873.26 as investors looked ahead to more vaccinations and a stimulus package from the US.
The 380 points added over five days means £97 billion has been added to the value of the companies on the index.
Barratt Developments was one of the best performers on the day, its shares rising 4.5% after saying it would bring back its dividend next month.
Marks & Spencer fell 2.4% after its sales over 13 weeks dropped by 7.6%.
2.30pm: Third vaccine approved
A third Covid vaccine has been approved for use in the UK which has boosted its order by 10 million doses to 17 million.
However, supplies of the Moderna vaccine, manufactured in in the US, are not expected to arrive until spring.
Around 1.5 million people in the UK have had at least one dose of Covid vaccine so far.
2pm: Markets expected to rise despite ‘diabolical’ labour figures
Wall Street’s main indexes were set rise further as hopes of more economic stimulus eclipsed concerns over US labour figures described by one analyst as “absolutely diabolical”.
The economy shed 140,000 jobs in December, the first jobs reversal in eight months in December, leaving the jobless rate unchanged at 6.7%.
Ayush Ansal, chief investment officer at the hedge fund, Crimson Black Capital, said the figure was “absolutely diabolical but the data will reinforce the prospect of the incoming administration reigniting the country with a major fiscal stimulus package.
“Wall Street is now looking forward, to a time beyond Trump, but at the same time market watchers are acutely aware that this is still arguably the most tense time in American political history for decades.”
Ulas Akincilar, head of rrading at the online trading platform, Infinox said: “We’re into inverse Cinderella territory here. Such a colossal miss on the headline jobs number would ordinarily send the markets into a flat spin.”
Some Wall Street bankers, however, expect a pull back in the near-term as exuberance from unprecedented monetary and fiscal stimulus have led to “frothy” asset prices.
8.45am: Fife decommissioning contract
A company in Fife has won Scotland’s biggest contract to dismantle offshore platforms.
8.30am: London presses ahead
Shares in London continued to progress. In the first half half hour of trading the FTSE 100 was up 16.04 points at 6,873.00.
7am: Marks & Spencer
Clothing sales slumped by 24.1% (like for like) over the 13 weeks to 26 December while (LFL) food sales rose 2.6%. Toal sales in the three months fell 7.6%.
Steve Rowe, chief executive said: “Given the on-off restrictions and distortions in demand patterns our trading was robust over the Christmas period.
“More importantly beneath the Covid clouds we saw a very strong performance from the Food business including Ocado Retail and a further acceleration of Clothing & Home online.”
Reach raises digital revenue
Reach, the publisher of titles such as the Daily Record, Daily Mirror and Daily Express, said total revenue declined by 10.2% in Q4, compared with 14.8% decline in Q3.
However, it expects underlying operating profit for 2020 to be ahead of market expectations, in the range of £130 to £135 million, following a record digital revenue performance.
Digital revenue grew by 24.9% in Q4, up from 13.4% in Q3. Print circulation sales were down 11.7% in Q4, compared to the 12.6% decline in Q3.
Chief executive Jim Mullen said: “We are ahead of where we expected to be. The new COVID-19 restrictions bring macro-economic uncertainty, but the changes made in the business during 2020 to develop a new, more efficient operating model put us in a strong competitive position.”
Barratt Developments to resume dividend
Barratt said the board expects to agree the resumption of dividends with the interim results on 4 February.
Total forward sales (including JVs) as at 31 December have increased by 14.3% to 13,588 homes (2019: 11,885 homes) at a value of £3,212.1m (2019: £2,691.0m), 19.4% up on last year. Barratt is over 90% forward sold for this financial year.
Pets At Home
The pets products group anticipates full-year underlying pre-tax profit, including the previously announced repayment of business rates relief of £28.9m, to be at least £77m, which is ahead of previous guidance
Its robust balance sheet and liquidity position was strengthened further at the end of 2020 through £80m in initial cash proceeds relating to the completion of the disposal of the Specialist Group.
Retail down by almost half
High streets, shopping centres and retail parks saw total year on year footfall for 2020 fall by 43.4%l, according to new data.
Helen Dickinson chief executive of British Retail Consortium, said: “Now that all parts of the UK are effectively in lockdown and with social distancing measures expected to continue well into the New Year, ‘non-essential’ stores will be unable to trade their way back to recovery.
“A third lockdown will be one too many for some businesses. Rent bills continue to weigh heavily and the threat of a return to full business rates liability in April still looms.
“The Government must urgently reassure those businesses hardest hit by the pandemic that they will receive vital financial support in the form of an extension to the coronavirus business rates relief.”
The Dow Jones industrial average rose above 31,000, closing at 31,041, up 212 points.
The S&P 500 index hardened 56 points to 3,804 and the Nasdaq Composite put on 327 points at 13,067.
Asian markets followed with Japan’s Nikkei 225 594 points higher and Hong Kong’s Hang Seng 210 points firmer.