Stocks in London opened in the red on Friday morning, ahead of the US personal consumption expenditures release and Frasers founder Mike Ashley making a bid for boohoo leadership.
UK retail sales volumes rose by 0.2% month-on-month in November, the Office for National Statistics said, improving from a 0.7% fall in October but falling short of the FXStreet-cited market consensus of 0.5% growth. On an annual basis, retail sales grew 0.5% in November. This missed the FXStreet consensus of 0.8%, and represented a slowdown from the 2.4% increase in the year to October.
‘Considering November falls right in the middle of the crucial ’golden quarter’ for retailers, this latest set of figures won‘t get champagne corks popping,’ remarked AJ Bell’s Danni Hewson. ‘Though the period doesn’t cover that now ubiquitous Black Friday weekend which shoppers tend to hang on for...To put it bluntly, consumers had the rug pulled out from under them in the run-up to the Budget and anecdotal evidence suggests they were still being cautious with their cash in the days that followed.’
UK public sector net borrowing came out about the same time.
‘Government borrowing in the first eight months of the 2024/25 fiscal year at £113.2 billion was £21.5 billion above the March Budget forecasts, after a larger-than-expected deficit in November continues to leave the Chancellor on the back foot against the OBR’s borrowing forecasts.
‘But, November’s overrun in isolation was just £1.2 billion, the joint-lowest overrun this fiscal year, and the OBR had already raised forecast public sector borrowing in 2024/25 by £40.3 billion in their October forecasts,’ Pantheon Macroeconomics’ Elliott Jordan-Doak explained.
The FTSE 100 index opened down 54.24 points, 0.7%, at 8,051.08. The FTSE 250 was down 112.82 points, 0.6%, at 20,286.56, and the AIM All-Share was down 1.47 points, 0.2%, at 710.31.
The Cboe UK 100 was down 0.6% at 807.82, the Cboe UK 250 was down 0.5% at 17,825.83, and the Cboe Small Companies was down 0.1% at 15,841.01.
On the FTSE 100, Frasers was up 0.28 points. Small-cap retailer boohoo was up 0.5%.
Shareholders in the AIM-listed fast fashion group gather for a general meeting called by Mike Ashley, Sports Direct owner Frasers’ founder and boohoo’s largest shareholder with a 28% stake.
Ashley is seeking to appoint himself as chief executive and also wants a board seat for his long-term associate Mike Lennon, arguing that the company has underperformed.
On the FTSE 250, IP Group gained 1.4%.
It announced that two quoted companies in its life sciences portfolio, Intelligent Ultrasound and Abliva, have received cash acquisition offers.
IP Group expects to receive £8.8 million for its 20.8% Intelligent Ultrasound stake, and SEK725.3 million (£52.4 million) for its 9.5% Abliva stake.
Among smaller caps, Judges Scientific was up 0.4%.
It announced that Chair Alexander Hambro has decided to retire at the end of 2024, ultimately stepping down from the board at the conclusion of the next annual general meeting in May 2025.
Current Non-Executive Director Ralph Elman will succeed Hambro with effect from January 1.
In European equities on Friday, the CAC 40 in Paris was down 1.1%, while the DAX 40 in Frankfurt was also down 1.1%.
The pound was quoted slightly higher at $1.2509 early on Friday in London, compared to $1.2500 at the equities close on Thursday. The euro higher stood at $1.0391, against $1.0364. Against the yen, the dollar was trading lower at JP¥156.83 compared to JP¥157.39.
In Asia on Friday, the Nikkei 225 index in Tokyo was down 0.3%. In China, the Shanghai Composite was up 0.27 points, while the Hang Seng index in Hong Kong was down 0.1%. The S&P/ASX 200 in Sydney closed down 1.2%.
In the US on Thursday, Wall Street ended mostly lower, with the Dow Jones Industrial Average up marginally, the S&P 500 down 0.1% and the Nasdaq Composite down 0.1%.
Brent oil was quoted higher at $72.46 a barrel early in London on Friday from $72.18 late Thursday.
Gold was quoted higher at $2,606.56 an ounce against $2,596.22.
Still to come on Friday’s economic calendar, as well as US PCE, look out for the eurozone’s consumer confidence reading.
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