The FTSE moved in and out of positive territory in trading on Friday. Retailers weighed on the index, meanwhile energy stocks and miners dominated the upper reaches.
Retailers were out of favour throughout the day, following disappointing numbers from Marks and Spencer (LON:MKS). Prior to the releases expectations had been running high; only earlier this week Morrisons (LON:MRW) and Sainsbury's (LON:SBRY) impressed investors with better than expected sales figures over the crucial Christmas period. Tesco (LON:TSCO) also posted its best festive sales figures in 8 years, showing that CEO Dave Lewis’ turnaround is firmly on track. The Tesco share price is up 40% over two years as a reflection of the turnaround and shares are likely to rise further going forward after like for like sales beat estimates once again. Yet despite a lot to like, the share price fell in trading on Thursday.
M&S drops 7%
Marks and Spencer (LON:MKS) was the biggest faller, dropping over 7% during the course of the day. Like for like sales during the Christmas period declined 1.4%. Clothing and homeware are still proving to be troublesome for the retailer with sales dropping 2.8%. Food also dropped but by 0.4% despite being considered the best sector.
Miners and Oil stocks higher
On the upside, miners traced metal prices higher, mining firms such as Billiton (LON:BLT), Rio Tinto (LON:RIO) and Anglo American (LON:AAL) were also higher. Energy stocks were also up as crude price held near three year highs, supported by US data showing that crude stockpiles declined for an eighth straight week. US crude is trading up a further 1.5% at $64.53 per barrel whilst Brent hit a high of $70 per barrel, the highest level since 2014. The softer dollar is also boosting the price of the dollar denominated commodity as a weaker dollar makes oil cheaper for foreign buyers.
Inflation concerns persist in US
Over in the US, the US indices were once gain charging higher, quickly moving on from concerns over China potentially halting purchases of US treasuries. The dollar on the other hand hasn’t been able to forget so quickly and the dollar index continues to trend lower. Softer than expected producer prices are also weighing on the buck. Weaker than forecast PPI fuels concerns over the sluggish inflation issue in the US. The dollar is down 0.6% versus a basket of currencies at 91.60.
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