The pound continued to fade today, down -0.25% mid-afternoon at 1.3386. Brexit secretary David Davis earlier confirmed to Parliament that no economic impact assessments had been made on how the UK economy will handle a Brexit transition. Davis instead offered Parliament other insight, including some sector “analysis” – though previously Davis claimed Brexit research of “excruciating detail” had taken place.
Some criticised the lack of preparation – David admitted he had not read any existing analysis on offer. Labour MP Alison McGovern said the situation was beyond parody. “The government is flailing around trying to get agreement to move onto talks on the future of UK-EU relationship. Yet they don’t even know what they want that relationship to be once they make that progress.”
Meanwhile other media sources, including the Sun, suggest Theresa May will not be back to Brussels this week to finalise a deal. Elsewhere an under-pressure pound was good news for an export-heavy FTSE 100, up 20 points to 7,348.
Whitbread shares soared more than +7% as activist investor Sachem Head Capital Management showed their hand, admitting a 3% stake in the company. The revelation may mean more pressure on Whitbread to offload its Costa Coffee brand. BAT shares were also up strongly, rising +3.6%. However Saga's gloomy profits news this morning saw its shares slip more than -21% today, the worst FTSE 250 performance by a big margin.
In the US private sector job growth slowed in November, latest ADP National Employment Report data suggested. Private employers saw a 190,000 job growth climb in November compared to 235,000 in October.
- UK FTSE 100 7,348 +0.28%
- Dow 24,143.02 -0.14%
- S&P 500 2,627.52 -0.08%
- Nasdaq 6,768.85 +0.10%
- Nikkei 225 22,177.04 -1.97%
- DAX 12,963.40 -0.65%
- CAC 40 5,370.84 -0.09%
- Gold 1,266.10 +0.13%
- Oil WTI 56.67 -1.67%
Shares in African 'Ikea' tumble
Earlier today shares in Steinhoff, the South African-listed owner of Poundland, crashed more than -60%. Investors sold down shares as news became clear that Steinhoff faced an accountancy probe – and also that boss Martin Jooste had quit. Steinhoff – sometimes described as Africa's 'Ikea' – has many tentacles, stretching across 30 countries absorbing more than 12,000 retail outlets.
Earlier this year Steinhoff claimed a +13% rise in operating profits for the first half to March. Last year it splashed out on buying UK discount retailer Poundland for a reported £450m. Before buying, Jooste expressed enthusiasim for a deal. “Steinhoff is developing a fast-growing, price-led retail business across the UK and the rest of Europe. Poundland would be a complementary fit to this growth story.”
Meanwhile the group, which includes Benson for Beds and Harveys Furniture, has delayed publishing full-year numbers till there is more clarity. "The company will publish the audited 2017 consolidated financial statements when it is in a position to do so,” Steinhoff said earlier today in a statement. "In addition, the company will determine whether any prior years' financial statements will need to be restated."
Hammerson moves in on Intu
Earlier shopping centre owner Hammerson said it had agreed a £3.4bn buy-out of its smaller rival Intu. Shares roared ahead for Intu, up +19% initially (but ending the day +13% higher) though Hammerson shares retreated on the news (ending, note, -6% down today, the FTSE 100's biggest faller). Still, the new merger makes Hammerson the UK’s biggest property player.
Overall Hammerson emerges as a business with more than £20bn of assets and overwhelming presence across the UK’s super-malls (around 12 out of 20 according to the BBC). That has to be good news for its buying power at a time when super-mall spending is strongly on the rise.
Breaking news: Wetherspoon's founder Tim Martin tells MPs the UK should ban all food tariffs when it leaves the EU.