Pub groups suffer | Joules still in Next talks
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5pm: Pub groups hit hard
Pub groups Marston’s and Wetherspoons had difficult sessions, closing down 1.7% and 0.2% after six of the UK’s biggest pub and brewing firms said some pubs had seen a more than 300% hike in bills this year, as part of a wider cost of living crisis.
The brewers – Greene King, JW Lees, Carlsberg Marston’s, Admiral Taverns, Drake & Morgan and St Austell Brewery – urged the government in an open letter to extend the cap to businesses.
The FTSE 100 closed 65.68 points lower at 7,361.63 as investors wiped out the morning’s gains following selling pressure in the US.
AJ Bell Investment Director Russ Mould, said: “The US Federal Reserve has spent more than a decade trying to fuel inflation with the blunt instruments of interest rates and Quantitative Easing and now it has (over)done it, the central bank seems determined to use the same tools to choke inflation, almost regardless of the damage done elsewhere.
“Fed chair Jay Powell seems to be focusing on inflation alone, and jettisoning prior concerns about unemployment and financial market volatility, so it is no wonder investors are getting jittery.”
Next talks continue
Retailer Joules has dismissed speculation that Next has walked away from a deal to finance the company and said talks are still ongoing.
“Further to the announcement on 19 August 2022, the group continues positive discussions with Next Group Plc about both adopting its Total Platform services to support its long-term growth plans and a potential equity investment,” it said in a statement.
“There can be no certainty that these discussions will lead to any agreement, and further announcements in this regard will be made if and when appropriate.”
AJ Bell investment director Russ Mould said: “Posh wellies seller Joules’ latest update (see below) – effectively decrying media reports that an agreement with Next for the larger retailer to invest in the business was breaking down – shows the desperation of its situation.
“Businesses like Joules, which are neither luxury brands nor bargain basement propositions and sell discretionary items, look particularly vulnerable against a highly squeezed consumer backdrop.”
New Yorkshire BS head
Yorkshire Building Society has announced that Susan Allen has been appointed chief executive.
Ms Allen has more than 25 years of experience in financial services having held senior executive positions at a number of large retail banks in the UK. She is currently head of customer transformation at Barclays.
Prior to that Ms Allen was responsible for all of Santander’s UK retail and business banking businesses.
She is a former board member of UK Finance and has been a champion of diversity and inclusivity throughout her career.
She will take over from Interim CEO Alasdair Lenman early next year. Her appointment is subject to regulatory approval.
Former footballer Rio Ferdinand is resigning as a non-executive director of the Gym Group to allow more time to focus on his other increasing commitments. The Gym Group will continue to work in partnership with The Rio Ferdinand Foundation. Elaine O’Donnell and Richard Stables join the board as non-executives.
Stock markets are expected to remain subdued as investors finally appear resigned to the US Federal Reserve being prepared to risk recession as the price for tackling inflation.
Wall Street ended lower yesterday, with the Dow Jones Industrial Average down 0.6%, the S&P 500 down 0.7% and the Nasdaq Composite down 1.0%
Comments from Fed chair Jerome Powell at last week’s Jackson Hole summit also sparked dollar strength. Sterling was quoted at $1.1707 early Tuesday, lower than $1.1764 at the London equities close on Friday.
In Asia, Japan’s Nikkei 225 index was up 1.2%. In China, the Shanghai Composite was down 0.7%, while the Hang Seng index in Hong Kong was down 0.9%. The S&P/ASX 200 in Sydney was down 0.7% in late trade.