Christmas boost for FTSE
A pre-Christmas boost for retailers helped power an upbeat performance by the FTSE 100 Index today.
Marks & Spencer was among a series of high street operators in the black as it benefited from a broker upgrade, adding almost 2% to its market value over the course of the session.
The upbeat mood in the sector was mirrored on the wider market, with the Footsie closing 13.9 points higher at 5521.1.
Sentiment was boosted by trading across the Atlantic, where the Dow Jones Industrial Average was around 40 points higher by the close of trading in London.
At home, M&S advanced 8.75p to 486.75p after broker Credit Suisse First Boston reiterated its “outperform” rating on the stock and lifted its price target to 500p.
Argos owner GUS joined it on the Footsie risers board as investors welcomed the news it had acquired an American website where online shoppers can compare retailers’ prices. The £273 million deal for PriceGrabber.com sent shares in in GUS up 8.5p to 992p.
These gains helped trigger a flurry of activity in the sector, which has been under a cloud in past weeks as polls suggest consumers are keeping their festive spending under tight control. Among others in the sector, B&Q owner Kingfisher added 3p to 229p and Next rose 18p to 1523p.
Hilton Group featured on the Footsie leaders’ board as speculation continued that suitors were circling the hotels sector. Shares were up 6p to 352.75p, while rival Intercontinental Hotels was up half a penny to 812.5p.
But utilities weighed on the market, with water group Severn Trent the heaviest faller – off 37p to 1038p – and National Grid down 3.5p to 554p.
Elsewhere, Hovis bread owner RHM cheered 4%, up 10.75p to 268.5p as investors welcomed news that first-half results were in line with expectations despite disappointing sales of the Mr Kipling range.
Leisure group De Vere was boosted by takeover talk, sending its stock up almost 8% or 53p to 728p.
However, book retailer Ottakar’s was in the doldrums after it revealed worsening sales despite the release of the sixth instalment of Harry Potter and Jamie Oliver’s latest cookbook. Shares fell 7.5p to 357.5p.
Money lender Provident Financial was out of pocket after announcing the closure of its Yes Car Credit Business and £141 million of associated costs.
Shares in Provident fell 7% or 41.5p to 558.5p as a trading update also pointed to weakness in its other operations, with bad debts rising at its UK home credit arm where the reduction in profits is likely to be more severe in 2006 than this year.
The highest Footsie climbers today were Smiths Group up 36p to 1008.5p, PartyGaming rising 4.5p to 132.5p, Land Securities up 53p to 1610p and BAE Systems adding 9p to 345.75p.
The heaviest fallers were Severn Trent down 37p to 1038p, Daily Mail & General Trust off 13.5p to 709p, Old Mutual falling 2.5p to 152.5p and BG Group down 7.5p to 552p.
