Tuesday, 5 November: In similar fashion to yesterday European bourses were buoyed from gains in the US and Asia overnight. Investors awaited the service PMI read for the UK, and despite the fact we had a read of 50, the level signalling the difference between expansion and contraction, sterling was lifted due to the surprise on the upside. October’s PMI read of 50 was higher than September’s 49.5, and higher than general forecasts. Of course, the UK is still being shackled by Brexit uncertainty, but we’ll take a small ‘win’ where we can. As sterling edged higher it managed to cool the FTSE’s progression, sitting around 0.3% higher midway through the session.
We also had the latest round of figures from the car industry today, with the SMMT showing new car registrations during October dipped by 6.7%. Hardly a surprise to anyone, with trends continuing in the underlying sales, such as diesel car registrations falling nearly 30%.
Topping the FTSE through the session was Primark’s parent owner AB Foods. The firm beat expectations slightly and issued a ‘fairly’ positive outlook for the coming year. Primark’s performance continues to defy other high-street neighbours, and their grocery business also performed very well, offsetting declines for their sugar arm. Pre-tax profit in the end was lower but nevertheless better than analysts had hoped for. If sterling was to recover this would also reduce pressures on Primark’s margins. Shares closed 5.56% higher.
Tobacco giant Imperial Brands said today that pre-tax profit for 2019 fell 7.1% as costs increased. The business has of course been hit by the controversies surrounding vaping, leaving the future of the industry up in the air to some degree. Shares closed 0.62% higher.
CAC 40 +0.39%