FTSE 100 climbs amid domestic market challenges
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The FTSE 100 rose by 0.3% on Thursday, continuing its upward trend and avoiding the steep selloff that pulled the FTSE 250 down by 2% on Wednesday to its lowest level since May.
Strong retail performance fails to lift sentiment
Several UK retailers reported positive updates:
Tesco
Christmas sales growth of 3.7%, driven by demand for fresh food and premium "Finest" products.
Marks & Spencer (M&S)
5.6% Q3 sales growth, bolstered by 8.7% food sales growth, although clothing and international markets showed weakness.
Greggs
Achieved record annual sales above £2 billion, despite a subdued Q4 due to weaker high street footfall.
Plans to open 140-150 new stores in 2025, signaling confidence in expansion.
B&M
Posted a 3.5% rise in sales and declared a 15p special dividend. However, it narrowed its profit guidance for the year.
Market reaction
Despite these strong updates, investor sentiment dragged shares lower:
Tesco: down 3.7%
Marks & Spencer: down 7.7%
Greggs: down 7%
B&M: down 9.5%
The declines reflect broader concerns over UK-focused assets, as slowing consumer spending and economic uncertainty weigh on investor confidence.
FTSE market dynamics
FTSE 100 performance
The index’s gains highlight its resilience, benefiting from the global exposure of large-cap companies.
FTSE 250 decline
The mid-cap index, more sensitive to domestic economic pressures, reflects investor skepticism about the UK's growth prospects amid rising bond yields and inflation concerns.
Retail sector outlook
While sales figures are strong, cautious profit guidance and weak consumer sentiment underscore challenges ahead.
Conclusion
The FTSE 100 shows relative stability despite domestic headwinds, while the FTSE 250 struggles under the weight of broader economic concerns. Retailers face mixed fortunes, with robust sales growth offset by investor worries about profitability and consumer spending trends. The coming weeks will test whether positive retail momentum can translate into stronger market performance amid ongoing uncertainty.
Strong retail performance fails to lift sentiment
Several UK retailers reported positive updates:
Tesco
Christmas sales growth of 3.7%, driven by demand for fresh food and premium "Finest" products.
Marks & Spencer (M&S)
5.6% Q3 sales growth, bolstered by 8.7% food sales growth, although clothing and international markets showed weakness.
Greggs
Achieved record annual sales above £2 billion, despite a subdued Q4 due to weaker high street footfall.
Plans to open 140-150 new stores in 2025, signaling confidence in expansion.
B&M
Posted a 3.5% rise in sales and declared a 15p special dividend. However, it narrowed its profit guidance for the year.
Market reaction
Despite these strong updates, investor sentiment dragged shares lower:
Tesco: down 3.7%
Marks & Spencer: down 7.7%
Greggs: down 7%
B&M: down 9.5%
The declines reflect broader concerns over UK-focused assets, as slowing consumer spending and economic uncertainty weigh on investor confidence.
FTSE market dynamics
FTSE 100 performance
The index’s gains highlight its resilience, benefiting from the global exposure of large-cap companies.
FTSE 250 decline
The mid-cap index, more sensitive to domestic economic pressures, reflects investor skepticism about the UK's growth prospects amid rising bond yields and inflation concerns.
Retail sector outlook
While sales figures are strong, cautious profit guidance and weak consumer sentiment underscore challenges ahead.
Conclusion
The FTSE 100 shows relative stability despite domestic headwinds, while the FTSE 250 struggles under the weight of broader economic concerns. Retailers face mixed fortunes, with robust sales growth offset by investor worries about profitability and consumer spending trends. The coming weeks will test whether positive retail momentum can translate into stronger market performance amid ongoing uncertainty.