Stock prices in London were in the red on Tuesday morning, as non-food sales in the UK remained in decline, while retail sales edged up only mildly in May.
The FTSE 100 index opened down 31.15 points, or 0.4%, at 8,229.30. The FTSE 250 was down 105.98 points, or 0.5%, at 20,794.74, and the AIM All-Share was down 1.27 points, or 0.2%, at 803.84.
The Cboe UK 100 was down 0.4% at 821.19, the Cboe UK 250 was down 0.2% at 18,342.12, and the Cboe Small Companies was fractionally higher at 17,108.44.
Total UK retail sales increased by 0.7% from a year before last month, according to the BRC-KPMG retail sales monitor, swinging from an annual decline of 4.0% in April.
The May increase was above the three-month annual growth average of 0.3% but below the 12-month average of 2.0%. In May 2023, sales had grown by 3.9% annually.
Food sales increased by 3.6% in the three months to May from a year before, below their 12-month average annual growth of 6.4%. Non-food sales declined by 2.4% in the same period, worsening from their 1.7% average annual decline over the past 12 months.
The decline in non-food sales last month was due to weakness on the high street, while online sales rose.
Meanwhile, in political news, the Conservative party announced plans for new annual caps on work and family visas, after Labour’s Keir Starmer pledged on Saturday to cut the number of migrants entering Britain.
The plan laid out by Prime Minister Rishi Sunak, who is predicted to lose to Starmer in the July election, would involve a new cap on the number of visas that would be set by parliament each year. Over the weekend, Starmer had set out Labour’s plans to cut regular migration by banning ‘bad bosses’ who violate labour laws from bringing foreign workers to the country, and by requiring employers to prioritise training Britons first.
The annual cap, which will progressively be lowered each year to cut migration numbers, will not affect foreign students and seasonal workers. More than 300,000 work visas were given in the year ending March 2024, which is more than double the number granted in 2019, according to official statistics.
In European equities on Tuesday, the CAC 40 in Paris was up 0.1%, while the DAX 40 in Frankfurt was up 0.6%.
The pound was quoted at $1.2797 early on Tuesday in London, higher compared to $1.2788 at the equities close on Monday. The euro stood at $1.0894, higher against $1.0883. Against the yen, the dollar was trading at JP¥155.61, lower compared to JP¥156.16.
British American Tobacco lost 1.4%.
The London-based firm, which is focused on cigarette and other nicotine products, bemoaned ‘ongoing macro-economic pressures’, particularly in the US market and the ‘continued lack of effective enforcement against the growing illicit vapour segment’. Accordingly, it expects first half revenue and adjusted profit from operations to be down by low-single digits on an organic, constant currency basis.
Nevertheless, BAT remains on track to deliver guidance for financial 2024 of low-single digit revenue and adjusted profit from operations growth. Its annual performance should be second half-weighted, with acceleration driven in part by the benefits of first half investment in US commercial actions.
Vistry gained 0.3%.
The Kings Hill-based house-building company has agreed terms with Blackstone Real Estate and Regis Group for the acquisition of a portfolio of new build homes totalling a gross development value of around £580 million. The portfolio, which is concentrated in the South-East of England, would be managed by Leaf Living, backed by funds managed by Blackstone and Regis.
LondonMetric lost 0.5%.
For the year ended March 31, the property company swung to pretax profit of £120.0 million from a pretax loss of £507.5 million a year prior. Rental income was £175.3 million, up 22% from £144.1 million.
It declared a fourth quarter dividend of 3.00 pence per share, up 15% from 2.60p.
MissionGroup gained 1.2%.
The firm saw its shares rise, after announcing that it is considering a revised potential takeover offer from digital advertising and technology service provider Brave Bison Group valuing Mission at about 35.2 pence per share, up from a previous offer ascribing the company’s shares a value of around 29.04p, which Mission had rejected.
The revised offer by Brave was announced in late May. Mission, an owner of a group of digital marketing and communications agencies, says there can be no certainty that an offer will be made.
In Asia on Tuesday, the Nikkei 225 index in Tokyo was down 0.2%. In China, the Shanghai Composite was up 0.4%, while the Hang Seng index in Hong Kong was up 0.2%. The S&P/ASX 200 in Sydney closed down 0.3%.
In the US on Monday, Wall Street ended predominantly higher, with the Dow Jones Industrial Average down 0.3%, the S&P 500 up 0.1% and the Nasdaq Composite up 0.6%.
Brent oil was quoted at $77.39 a barrel early in London on Tuesday, down from $78.22 late Monday.
The OPEC+ group of oil-producing nations agreed Sunday to extend their production cuts in a bid to support prices, as economic and geopolitical uncertainty looms over the market, reported AFP.
The 12-member oil cartel and its 10 allies decided to ‘extend the level of overall crude oil production...starting 1 January 2025 until 31 December 2025,’ a statement by the alliance said.
Some of those cuts will run until September before being phased out, while others will be kept in place until December 2025.
Gold was quoted at $2,343.50 an ounce, up against $2,341.60.
Still to come on Tuesday’s economic calendar is the Redbook index, job openings and labour turnover survey, and total vehicle sales from the US. European Central Bank member of the supervisory board Edouard Fernandez-Bollo, and supervisory board chair Claudia Buch, are also both due to speak.
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