Thursday, 27 October: Stocks in London were mixed today, despite the UK posting an expectations-beating read for GDP this morning. Preliminary GDP came in at 0.5% and 2.3%, beating estimates of 0.4% and 2.2% on respective quarter-on-quarter and year-on-year reads. Sterling strengthened against both the euro and dollar into lunchtime trade on the news before pairing these gains in the US open, and beyond. Banking, oil, travel and media stocks supported the FTSE 100 in a busy day for UK listed companies.
Debenhams traded 3.07% higher, despite the FTSE 250 department store reporting a fall in profit in its recent full year results as it booked exceptional costs, and a shift lower in margin. Margins were hit by a slow second half of the year forcing the retailer to discount stock in order to pull more shoppers into its stores.
Amec Foster Wheeler(-20.72%) was the latest in a line of natural resource companies to bear the brunt of investor discontent, as it announced business restructuring activities in the wake of year-on-year revenue falls on a like-for-like basis of 3%. Sterling weakness was a doubled-edged sword for the company, as it helped to increase the top-line 3%, but prompted a deterioration in the net debt position of the firm.
Nissan compounded optimistic GDP news today, with the announcement of new car models to be built in the UK. After some well-publicised apprehension on the part of the Japanese company post the Brexit vote, Nissan committed to building both the new Quashqai and the X-trail SUV at Britain’s largest car plant in Sunderland. The news came after only one month ago when the Nissan’s Chief Exec Carlos Ghosn warned than FDI may not be forthcoming unless the government guaranteed compensation for costs related to any new trade tariffs arising from Brexit.
At the close, European indices were mixed with the FTSE 100 +0.41%, the DAX 30 +0.07% and the CAC 40 -0.02%.