No Bank holiday lift for retail | ASOS bid talk
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4.30pm: Market ends in green
The FTSE 100 closed 28.11 points higher at 7,628.10.
Primark owner Associated British Foods slipped 0.11% after announcing that it had acquired dairy technology firm National Milk Records for £48m.
Fashion retailer Asos tumbled 5.12%, having rallied on Monday amid speculation that the company could be a takeover target.
Mike Ashley’s Frasers Group reported an increase in its stake in Asos, moving from 7.4% to 8.8% – a significant increase from its 5% stake in October 2022.
Retail holiday setback
Three Bank Holiday weekends failed to make any impression on UK retail sales which posted slow growth.
Total retail sales increased by 3.9% in May, or by 3.7% on an underlying basis, according to the latest BRC-KPMG Retail Sales Monitor.
That was an improvement on May 2022, when retail sales fell by 1.1% and 1.5% on an underlying basis.
But the growth was below the three-month average and notably lower than April, when sales rose by 5.1% or by 5.2% on a like-for-like basis.
Food sales increased by 9.8% in May on a like-for-like basis, while non-food sales nudged up just 0.5%.
Helen Dickinson, chief executive of the British Retail Consortium, said: “The trio of bank holidays failed to get shoppers spending, as sales growth slowed to its lowest level in six months.
“While food sales got a boost from the coronation weekend, this was not sustained for the rest of the month.”
Paul Martin, UK head of retail at KPMG, said: “Retailers will be hoping that inflation levels in the wider economy continue to move in the right direction in order to boost much-needed consumer confidence.
“The wild card for the retail sector remains uncontrollable food inflation, which shows little sign of coming down in the near future, and is having a significant knock-on effect on non-essential spending.”
Oil surrendered some of the price gains made after the production cut announced by Saudi Arabia over the weekend. Brent crude was trading at $76.61 a barrel.
Wall Street ended in the red following a disappointing services report. The Dow Jones Industrial Average closed 0.6% lower, the S&P 500 down 0.2% and the Nasdaq Composite off by 0.1%.
In Asia, the Nikkei 225 index was up 0.8%. The Shanghai Composite was down 0.3%, while the Hang Seng index in Hong Kong was up 0.6%.