The Christmas retail reporting season created more winners and losers today as the wider market eased back from yesterday’s fresh two-and-a-half year high.
Game Group and Argos-owner Home Retail Group were soaring ahead after their festive reports, but supermarket Tesco and Currys-parent Dixons Retail Group fell heavily after disappointing investors.
The FTSE 100 Index eased back by 26.8 points to close at 6023.9, despite further gains from banks and insurers in the wake of yesterday’s relief over a successful bond auction for under-pressure Portugal and more bond auctions today in Spain and Italy.
Royal Bank of Scotland rose 1.4p to 42.6p, while fellow taxpayer-backed player Lloyds Banking Group added 0.8p to 68.5p. Barclays, which is believed to have a lot of exposure to the Iberian peninsula, was up 3.4p to 306p.
There was little reaction to the widely anticipated decision by the Bank of England to leave interest rates on hold at a record low of 0.5% and quantitative easing unchanged at £200bn (€237bn).
In America, the Dow Jones Industrial Average slipped into the red after the Government revealed an increase in the number of people applying for unemployment benefits. That helped the pound rise to 1.59 US dollars.
But the news of the successful European bond sales left the pound down against the euro, at 1.19.
Retailers were in sharp focus in London as a busy session for updates confirmed the view that the snow-hit trading period had been a mixed one for the sector.
Tesco was the Footsie’s biggest faller after it posted modest 0.6% like-for-like sales growth in the six weeks to January 8.
Shares fell 18.2p to 405.6p – or 4% – as the update appeared to reinforce recent signs that smaller rival Sainsbury’s had gained ground on the industry market leader.
Fellow blue chip retailers Marks & Spencer and Next were enjoying gains, up 7.4p to 380p and 41p to 2094p respectively.
In the FTSE 250 Index, Argos-owner Home Retail Group jumped 21.1p to 227.1p after it said its profit forecasts remained intact after the festive period.
Dixons Retail Group moved in the opposite direction, down 2.4p to 21.4p after it said UK and Ireland like-for-like sales fell 4% and cautioned that annual profits were expected at the bottom end of forecasts.
Halfords was another faller, down 15p to 405p, as it also said profits were likely to be at the lower end of market forecasts, due to poor sales of children’s bicycles.
But Game Group jumped 16% or 9.8p to 72p after a strong Christmas season for games releases helped improve its UK and Ireland trading significantly, with sales down 0.5% against a 7.6% drop in the previous 18 weeks.
The biggest Footsie risers were IMI up 38.5p at 949p, Resolution ahead 9p at 252p, Royal Bank of Scotland up 1.4p at 42.6p and Admiral Group ahead 44p at 1569p.
The biggest Footsie fallers were Tesco down 18.2p at 405.6p, British American Tobacco off 86p at 2325p, Burberry down 38p at 1080p and Rexam off 10.3p at 345.8p.