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GDP fall below forecast; Burberry rebounds; Hammerson loss

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4.30pm: London closes higher

The FTSE 100 closed up 24.51 points at 6,761.47.

Luxury goods brand Burberry surged 6.87% after it lifted full-year guidance and reported a “strong rebound” in trading since December (see below).

Shopping centre owner Hammerson rallied 6.99% even after it posted a loss for 2020 as it took a hit from the pandemic (See below).

Shares in Scottish battery firm AMTE Power closed at a healthy premium to their placing price following its debut on the Alternative Investment Market. Full story here

8.30am: Blue chips slip

The FTSE 100 was trading 23.4 points down at 6,713.57 as traders expressed caution over the fall in GDP (see below).

Scottish battery manufacturer AMTE Power saw its value soar when its shares were admitted to the Alternative Investment Market today.

7am: GDP shrinks

Easter-Inch-Business-Park-Bathgate

The UK economy shrank by 2.9% in January amid lockdown measures, a smaller contraction than the 4.,9% fall predicted in a Reuters poll.

The economy is 9% smaller than it was before the start of the coronavirus pandemic, according to figures from the Office for National Statistics.

BCC head of economics, Suren Thiru, said:   “The latest data confirms a better than expected start to the year for the UK economy.  

“The vaccine rollout and budget stimulus will boost output as restrictions ease. However, the lingering economic effects of covid, including elevated consumer and business debt levels, may severely limit the pace of any recovery. ”

Exports plunged after Brexit

The value of UK exports to the European Union plummeted by £5.6bn after the Brexit transition period ended, in the sharpest drop since records began.

Total exports of goods fell by £5.3bn, or 19.3%, from December 2020 to January 2021. The fall was mainly driven by a 40.7% drop in exports to the EU.

AMTE Power IPO

Thurso-based battery specialist AMTE Power will have a market value of about £61 million when its shares are admitted to the Alternative Investment Market today. Full story here

Hammerson losses deepen

Shopping centre company Hammerson saw IFRS losses for the year to 31 December deepen to £1.7 billion from a £781m last time, primarily due to property revaluation deficit and rental income plunged.

Net rental income fell 49% to £157.6m amid closures, tenant restructuring, higher provisions for bad debts and tenant incentives.

It is recommending a final dividend of 0.2p making 0.4p for the year (2019: 5.1p).

Burberry rebounds

Luxury fashion retailer Burberry said revenue and adjusted operating profit for the year to 27 March are expected to be ahead of consensus.

In an unscheduled trading update, the FTSE 100 said there had been a strong rebound in trading since December.

Comparable store retail sales in Q4 FY2021 are expected to be in the range of +28% to +32% higher than the same period last year.

“For the full year, we expect group revenue to decline by -10% to ‑11% and the adjusted operating margin to be in the range of 15.5% to 16.5%.”

Full year results will be released on 13 May.

Berkeley Group robust

South east England housebuilder Berkeley Group said it was on track to report annual profit similar to the year before after “robust” trading in the four months to the end of February.

Forward sales are expected to be more than £1.7bn at the end of the year on 30 April. The FTSE 100 group said it expected a similar level of profitability next year, underpinning its commitment to return £280m to shareholders each year.

Markets

Brent crude prices eased as production cuts by major oil producers constrained supply, with optimism about a recovery in demand for the resource in the second half of the year also lending support.

Brent crude futures for May slipped 11 cents, or 0.2%, to $69.52 a barrel while US West Texas Intermediate crude for April was at $65.83 a barrel, down 19 cents, or 0.3%.

US stocks had a good day with the Dow Jones climbing 189 points and the S&P 500 rising 41 points but the picture has been more mixed this morning in Asia.

In Japan, the Nikkei 225 surged 1.73% and South Korea’s Kospi gained 1.35%. The Hang Seng index in Hong Kong fell 0.83% while the Shanghai Composite in China rose 0.30%.



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