London midday: Stocks maintain gains as retailers get a boost from Morrisons
London stocks were holding on to gains by midday on Tuesday as retailers were boosted by a solid Christmas trading update from Morrisons.
The FTSE 100 was up 0.4% to 7,726.52, sitting just below the fresh intraday high of 7,733.39 hit on Monday, while the pound was up 0.1% against the euro at 1.1350 and down 0.2% versus the dollar at 1.3539.
In corporate news, supermarket group Morrisons rallied as it reported a much stronger than expected Christmas period, boosted by the roll-out of its new wholesale operations.
The grocer's trading update has boosted other shares in the sector with Marks & Spencer actually rising by more than Morrisons in gaining around 3.5% ahead of the release of its own festive results on Thursday. Sainsbury’s is also making strides higher but Tesco is the odd one out in trading lower by around 1% despite industry data suggesting that it was the best performer of the ‘big four’ over the festive period.
“Tesco enjoyed the largest sales growth amongst its peers during December according to figures from Kantar Worldpanel and today’s decline is likely to be simply a case of profit taking after a strong run higher of around 25% in the past six months,” said David Cheetham, chief market analyst at XTB.
Data from Kantar Worldpanel was also out, showing £1bn more was spent in UK supermarkets the three months to Christmas than the year before, while figures from the British Retail Consortium revealed that wider retail sales remained lacklustre in the industry's vital festive period due to non-food sales growth being the lowest in five years.
Sales increased 0.6% in December, the BRC found, the same as the month before, as price inflation drove a 2.6% rise in food sales that was all but wiped out by a 2.2% fall in non-food retail sales. High street sales in the three months to December of non-food items declined 4.4% on a like-for-like basis, which is the lowest rate since 2012, when the BRC's records began.
Elsewhere in corporate news, cigarette maker British American Tobacco was in the black as it said 2018 earnings would get a 6% boost from the recent US tax cuts “supporting our commitment to high single digit earnings growth and increased investment in the roll out of next generation products”.
Veterinary drug specialist Dechra Pharmaceuticals rose after it reported a 10.5% jump in half-year revenue and said changes to US taxes are expected to have a positive impact on the group, while Safestore edged up as its full-year revenues and earnings beat expectations.
On the downside, housebuilder Persimmon slipped after saying it expected full year pre-tax profits would be “modestly ahead” of market consensus.
Building products distributor SIG as it said full-year results should be in line with expectations after a forex boost.
Shares in Just Group slumped after European private equity firm Permira sold 50m shares in the retirement specialist at 157p each in a placing that represents a stake of around 5.3%.
Market Movers
FTSE 100 (UKX) 7,726.52 0.39%
FTSE 250 (MCX) 20,866.74 0.05%
techMARK (TASX) 3,535.36 0.25%
FTSE 100 - Risers
Marks & Spencer Group (MKS) 321.30p 3.38%
Anglo American (AAL) 1,669.00p 2.58%
Informa (INF) 753.00p 2.31%
Micro Focus International (MCRO) 2,191.00p 2.14%
Next (NXT) 5,024.00p 1.87%
Sainsbury (J) (SBRY) 245.10p 1.70%
BT Group (BT.A) 272.05p 1.53%
Morrison (Wm) Supermarkets (MRW) 230.30p 1.50%
Carnival (CCL) 4,886.00p 1.43%
Johnson Matthey (JMAT) 3,231.00p 1.41%
FTSE 100 - Fallers
Severn Trent (SVT) 2,087.00p -2.06%
United Utilities Group (UU.) 797.00p -1.85%
Persimmon (PSN) 2,714.00p -1.24%
Tesco (TSCO) 211.79p -1.17%
Mediclinic International (MDC) 633.40p -0.78%
easyJet (EZJ) 1,513.50p -0.72%
Smith (DS) (SMDS) 509.20p -0.66%
Rolls-Royce Holdings (RR.) 863.80p -0.55%
CRH (CRH) 2,742.00p -0.47%
Centrica (CNA) 144.38p -0.47%
FTSE 250 - Risers
Pets at Home Group (PETS) 175.80p 4.83%
Kaz Minerals (KAZ) 934.80p 4.33%
Aggreko (AGK) 818.40p 3.00%
Rotork (ROR) 286.90p 2.61%
Dechra Pharmaceuticals (DPH) 2,052.00p 2.29%
Vectura Group (VEC) 118.00p 1.99%
Hays (HAS) 188.00p 1.95%
Evraz (EVR) 377.70p 1.78%
Pagegroup (PAGE) 472.00p 1.77%
JD Sports Fashion (JD.) 352.50p 1.70%
FTSE 250 - Fallers
Just Group (JUST) 153.00p -8.77%
SIG (SHI) 166.90p -3.64%
Cineworld Group (CINE) 556.10p -3.37%
SSP Group (SSPG) 663.00p -2.86%
TBC Bank Group (TBCG) 1,620.00p -2.64%
Mitie Group (MTO) 189.90p -2.16%
UBM (UBM) 741.50p -2.11%
Shaftesbury (SHB) 1,038.00p -1.61%
AA (AA.) 161.40p -1.53%
Provident Financial (PFG) 930.80p -1.44%