Equities are on the rise this morning with the FTSE moving up near its highest price in a month as the benchmark looks to gain traction above the 6800 level. After dropping to its lowest point in over 2 years towards the end of last year, sentiment has tentatively improved for the UK blue-chip index with a strong bounce in US stocks leading the recovery. The rise on Wall Street could be attributed to hopes of a thawing in the frosty relationship between the US and China with trade talks continuing in Beijing, but having said that it still seems unlikely that there’s any tangible progress on this front anytime soon.
Morrisons the main laggard
The worst performing stock in the FTSE 100 today is Morrisons, with the supermarket falling more than 3% after delivering its latest trading update. Despite reporting a rise in sales over the key festive period and CEO David Potts trying to put a positive spin on it, the overall feeling is one of disappointment with Morrisons seeing its market share drop by 0.2%. The theme amongst supermarkets over Christmas was really a continuation of what we’ve seen for a couple years now with discounters such as Aldi and Lidl gaining a larger share of the total market at the expense of the traditional big four - Asda, Sainsbury’s, Tesco (LON:TSCO) and Morrisons.
This is highlighted by the fact that Aldi reported a double-digit increase in sales over Christmas, narrowly edging out Lidl for the top spot while Morrisons managed an increase of just 0.1%. Shares in Morrisons remain around 20% below last year’s high of 2.70 seen in the late summer and they have dipped to their lowest level in 9-months this morning following the update.
Couldn’t organise a traffic jam on the M20
The government stepped up their no-deal Brexit preparations yesterday by staging a live rehearsal of a traffic jam in an attempt to show the impact that this eventuality would have on congestion and gridlock. The drivers, who were paid £550 each by the government started their journey at Manston airport then headed along a 3-mile stretch of the A256, which had been coned off to normal traffic, before heading en masse to Dover. However, the stunt seems to have been pretty pointless as only 89 lorries took part, a tiny fraction of the 10,000 heavy goods vehicles which pass through Dover everyday.
The event was the most public display yet of the government’s contingency planning but it was seen by many as too little too late and actually failed to cause anywhere near the feared level of congestion - likely because the number of lorries was not sufficiently large and therefore not a true reflection of the possible impact. This means if the event was intended to scare MPs or voters into opposing a no-deal outcome it roundly failed and you could say the failure to cause a traffic jam on the M20 has become the new “piss-up in a brewery” - a sad reflection of the government’s organisational skills.
The pound remains fairly mixed on the whole in quiet trade, with talk of plans being made to extend the Article 50 deadline causing little by the way of any market reaction.