Tuesday, 26 March: Despite the ongoing global growth uncertainty weighing on investor sentiment, equity markets largely rebounded somewhat, with Asia taking the lead. Without sounding repetitive, the Nikkei in Japan made the biggest movement, adding 2.15% to erase some of yesterday’s losses. London indices were in the green for the bulk of the day after a shaky start, the FTSE 100 closing 0.26%. Brexit noise continued to dominate headlines, the latest development in addition to last night’s vote coming from the DUP’s lack of support over May’s deal. Sterling held steady against the euro and US dollar, keeping above €1.17 and $1.32 respectively.
Ocado were once again the dominant force on the main London index, this time following a deal with Australian supermarket Coles. In this latest partnership, Coles Online’s business will be further developed with the use of Ocado’s Smart Platform. Two new robotic centres, or customer fulfilment centres (CFCs) as Ocado likes to call them, will be build down under, one in Melbourne and one in Sydney, with the centres set to be operational within four years. This is Ocado’s fifth major overseas deal in less than 18 months and further highlights how retailers are moving in order to compete with online retail. Ocado rose 4.10% at the close, pushing its year-to-date gains to c.61%. Coles Group on the ASX rose 3.1%.
The cat and mouse chase between Sports Direct and Debenhams continues. Last night, Sport Direct said it was considering an offer to buy Debenhams, in an all cash deal. Seems Mike Ashley is only all the more determined after Debenhams rejected Ashley’s £100m offer for its Danish division. This morning Debenhams announced it would consider any firm offer for the business, while adding it will continue with its plan to secure funding. Sports Direct now has until April 22 to announce a firm intention to make an offer or walk away. Debenhams’ investors were buoyed by the potential talks, shares surging nearly 42% to claw back some year-to-date losses, now at c.60%.
At the close, major European indices ended the session in the green. Wall Street has followed suit with all major indices driving higher at the time of writing. Apple is trading modestly higher on the NASDAQ following last nights streaming service and credit card announcement. Investors had initially reacted with caution to Tim Cook’s “services” event, with no indication of subscription costs or content provided.