Market report

Quiz | Tesco | Stagecoach | SSE | Taylor Wimpey

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5pm: London shares dip

The FTSE 100 index closed 2.55 points, or 0.01%  lower at 7,337.35, below the day’s peak of 7,378.92 but above the session low of 7,333.56 as the UK government ponders further Covid-19 restrictions.

Housebuilder Berkeley Group was the best performers in the blue chip index, gaining 2.4% for taking on “large-scale, complex” sites in London and the south east of England for a strong rise in interim earnings.

Barratt Developments and Persimmon advanced 1.2% and 1.3% respectively in a positive read-across.

Energy group SSE added 0.5% after hitting back at activist hedge fund Elliott Management for a second time.

On Tuesday Elliott publicly called for SSE to be broken up, claiming such action could add more than £5 billion to the firm’s value.

Today Perth-based SSE said it has evaluated and challenged a wide range of possible strategic options, across both electricity networks and SSE Renewables, including the separation of SSE Renewables.

SSE reaffirmed its net zero acceleration programme, saying that it’s the “optimal pathway for creating long-term value for shareholders”.


2.30pm: Tesco strikes suspended

Planned strikes by workers at Tesco distribution centres have been suspended after a new pay offer.

Unite said it was recommending its members accept the supermarket group’s offer of a minimum of a 5.5% pay increase backdated to July 2021 and an additional 0.5% from February 2022. The union had previously rejected a 4% offer.

Tesco still faces possible walkouts by more than 5,000 members of the Usdaw union at depots in Daventry, Peterborough, Hinckley and Lichfield in central England, Goole in northern England, Southampton in southern England, Livingston in Scotland and Magor in Wales.


9.30am: Watchdog approves Sea Farms deal

The Competition and Markets Authority has approved Scottish Sea Farms’ £164 million acquisition of Grieg Seafood Hjaltland UK. 

Full story here


9am: Blue chips open higher

The FTSE 100 continued its winning streak, rising a further 0.4% to 7,368 as investors brushed off fears over the Omicron variant and regained their appetite for risk.

Russ Mould, investment director at AJ Bell, says: “Even Asian stocks pressed ahead despite gigantic Chinese property developer Evergrande being on the verge of collapse.

“A few months ago, Evergrande’s failure to make bond repayments spooked global markets and led to speculation of a potential crisis in China’s property and financial system. Now it seems as if markets have just accepted that Evergrande could collapse and there is no panic.”

In London, housebuilder Berkeley was the top riser, up nearly 5% on improved earnings expectations. It said sales have recovered to pre-pandemic levels and earnings guidance for this financial year has been lifted by 5%, with 5% annual profit growth expected for the next three years.


7am: Quiz returns to underlying profit

Quiz-Clothing

Fashion chain Quiz Clothing said it had returned to positive EBITDA as hospitality opened up.

Group revenue for the half year to the end of September doubled (up 109% to £36 million against £17.2m last time) over the same period last year.

Underlying EBITDA profit came in at £0.7 million (H1 2021: loss of £3.3 million).

Tarak Ramzan, founder and chief executive, said: “Quiz has delivered an encouraging set of results during the period with strong cash flows generated and a return to positive EBITDA. The removal of the social restrictions resulted in a substantial uplift in revenues in the period, as customer demand for the brand’s dressy and occasion wear returned.

“The positive steps taken over the last 18 months with regards to restructuring our business, tight cost control and inventory management have all proved beneficial.

“Whilst there continues to be uncertainty in the short-term we remain confident in the strength of our brand and are highly confident that the clear demand for QUIZ’s trademark occasion-wear will support continued profitable growth.”


7am: CEO to leave Taylor Wimpey

Pete Redfern, chief executive of Taylor Wimpey, is to step down after more than 14 years in the role, the housebuilder said. He will leave the business once a replacement has been found and a full handover has taken place.

The company said it had a “robust” succession plan in place and that the recruitment process was “advanced”, with both internal and external candidates being considered.

Mr Redfern said: “The business is in excellent health, and is well positioned for strong future growth. Accordingly, I am confident that now is the right time for fresh leadership as Taylor Wimpey starts the next chapter.”

Chairman Irene Dorner added: “Pete has made an invaluable contribution to the business, including having successfully led the company through a global financial crisis and the recent pandemic.

“Pete will leave the business with a strong and differentiated culture he can be proud of creating.”


7am: Stagecoach ‘positive’

Transport group Stagecoach said in a half-year statement that it continues to discuss a possible all-share merger with National Express Group. “In the meantime, it is business as usual for our business and our people.

“Regardless of the outcome of those discussions, we see a positive future for our business, and we are focused on delivering high quality, good value public transport services in our communities.”

Revenue for the six months to 30 October grew to £579.4m (H1 2021: £454.6m) and adjusted total operating profit grew to £32.9m (H1 2021: £16.1m).

Martin Griffiths, group chief executive, said: “We continue to see a positive outlook for our bus, coach and tram services, whether as a standalone business or as part of a combined future group.

“Greener and smarter public transport is central to delivering government ambitions around decarbonisation, levelling up of communities, driving economic recovery, and securing better health outcomes for citizens.”

The company has not declared an interim dividend.


Global markets

The FTSE 100 index was expected to break its winning stream and open a tad lower. The blue-chip index closed up 107.62 points, or 1.5%, at 7,339.90.

Wall Street ended sharply higher, with the Dow Jones Industrial Average up 1.4%, S&P 500 up 2.1% and the Nasdaq Composite up 3.0%.

Asia followed suit with the Japanese Nikkei 225 index closing up 1.4%, the Shanghai Composite 1.1% higher and the Hang Seng index in Hong Kong up 0.2%.

Brent crude was quoted at $75.33 a barrel this morning, up from $74.74 late on Tuesday. 



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