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FTSE Lower Amid Corporate Disappointments

By City Index (Fiona Cincotta)Stock MarketsJan 16, 2020 16:50
uk.investing.com/analysis/ftse--lower-amid-corporate-disappointments-200436746
FTSE Lower Amid Corporate Disappointments
By City Index (Fiona Cincotta)   |  Jan 16, 2020 16:50
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FTSE Lower Amid Corporate Disappointments

Optimism surrounding the signing of the US – China trade deal quickly faded and the FTSE was pretty much on the back foot from the start of trading. The FTSE is heading into the close hovering around support at 7600 following a disappointing day for corporate updates, with Pearson (LON:PSON), Whitbread (LON:WTB) and Hays (LON:HAYS) among the laggards. The stronger above $1.3050 is adding the FTSE’s woes.

Whitbread (LON:WTB) UK Sales Fall

Whitbread (LON:WTB) disappointed with its update, as room sales fell 2.1% in the three months to November. Impacted by weaker business and consumer confidence, business and leisure bookings took a hit. This update was prior to the UK general election, and whilst the share price has jumped 20% since December on improved political and Brexit clarity, the reality is any improvement in confidence will take time to filter through into improved UK investment spend and sales.

Pearson’s Plummets

The Pearson share price slumped to a 10-year low shedding over 8% following yet another profit warning from the troubled educational resource provider and publisher and the announcement if the departure of the CFO Coram Williams (NYSE:WMB). With the stock down an eye watering 60% so far this year and we are unlikely to have seen the end of the sell off here. The departure of Coram Williams so soon after CEO John Fallon stepped aside will no doubt complicate the turnaround plans at the struggling firm, pushing any recovery further into the distance.

Pound holds gains

The pound has managed to remain in positive territory for a third straight session. The pound pushed above $1.3050 despite growing concerns of an imminent rate cut from the BoE and despite a solid increase in US retail sales. US retails increased 0.3% month on month, with core retail sales beating forecast at 0.5%; a good sign for the US economy. With strong job creation, 2.9% wage growth and consumer confidence at the highest level since May, households have been spending in the festive period.

Disclaimer: The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient.

Any references to historical price movements or levels is informational based on our analysis and we do not represent or warrant that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, the author does not guarantee its accuracy or completeness, nor does the author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

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FTSE Lower Amid Corporate Disappointments
 

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FTSE Lower Amid Corporate Disappointments

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