Proactive Investors -
- Blue-chip index hits a record 8,073
- Primark owner's profits soar
- JD Sports to expand US exposure
8.28am: FTSE smashes new record
The FTSE 100 is up another 50 points in the first 30 minutes of the day’s session, meaning the index is currently at an all-time high of 8.073.
A rebound in market sentiment amid a cooling of Middle East Tensions is driving the rally. Primark owner AB Foods is top of the table after delivering a top set of interim results, Ocado (LON:OCDO) Group, JD Sports and Marks & Spencer also rallying.
8.22am: Taylor Wimpey (LON:TW) one of the ‘better placed’ builders
UK housebuilder Taylor Wimpey PLC (LSE:TW.)’s shares were 0.8% higher in opening exchanges following a quarterly trading update.
The group maintained annual guidance, with chief executive Jennie Daly highlighting “continued market stability supported by good mortgage availability and sustained customer confidence”.
As of 21 April, Taylor Wimpey’s total order book value stood at £2.09 billion, representing 7,686 homes.
Aarin Chiekrie, equity analyst, Hargreaves Lansdown (LON:HRGV), said: “Despite the trends of a modestly improving market, buyers are likely to remain sensitive to price going forward, so it was unsurprising to see management remain cautious and hold full-year guidance firm in today’s update.
“Full-year performance will be second-half weighted as improved pricing and lower build cost inflation feed through and improve profitability.
“All in, Taylor Wimpey looks to be one of the better-placed UK housebuilders, and the current valuation could be an attractive entry point for investors willing to ride out near-term uncertainty in the housing market.”
8.10am: THG’s beauty division drives revenue growth
THG (LON:THG) boss Matt Moulding could be feeling vindicated today after guiding the online retailer through a turbulent couple of years.
The group reported accelerated revenue growth over the first quarter as sales continued to improve after sweeping changes made last year.
Continuing revenue was up 2.1% at £455.4 million, or by 4.5% on a constant currency basis, fuelled by an 11.1% uptick within its beauty division.
This was partially offset by a dip in sales from THG’s nutrition and commerce solutions businesses.
“With this major capex program behind us, these investments will continue delivering meaningful savings, which accelerate further as new Ingenuity partners are onboarded,” Moulding added.
THG said it continued to monitor the situation in the Middle East, adding Israel accounts for around 1% of the group’s sales.
Guidance for adjusted pre-tax earnings margins to hit 9% over the year was held, with revenue growth expected to reach the high single digits in the second half.
Shares added 1.8% in opening exchanges.
7.47am: JD Sports proposes $1bn splash out on Nasdaq-listed Hibbett
JD Sports has proposed one of its biggest US acquisitions yet with the purchase of Nasdaq-listed sporting goods retailer Hibbett.
JD has entered into a binding agreement to pay $87.50 per share for 100% of the group’s capital at a 21% premium to yesterday’s closing price.
It implies a $1.08 billion (£878 million) valuation on the Birmingham, Alabama-headquartered company.
In a Tuesday statement, JD’s management positioned the proposed acquisition as another step forward in enhancing its US retail exposure.
Régis Schultz, chief executive of JD Sports, said: "This acquisition is in line with our strategic priorities and is a very important transaction for our strategic and financial development.
“Strategically, it enhances our presence within North America and achieves our objective of strengthening our Complementary Concepts division.
“Hibbett's footprint is highly complementary, adding a stronger presence in communities across the southeastern US, where we currently have a limited presence. It will also provide a stronger platform for the rollout of the JD fascia in the US.
Some of JD’s previous US-based acquisitions included Finish Line (NASDAQ:FINL) in 2018 for $558 million and Shoe Palace in 2020 for $325 million.
7.30am: Primark owner AB Foods' profits surge
Primark owner Associated British Foods PLC (LSE:LON:ABF) benefitted from strong margin recovery and operational improvements in the first half to deliver a bumper set of interim results.
Though group revenue only ticked 2% higher to £9.7 billion, adjusted operating profit ran up 39% to £951 million, with adjusted earnings per share (EPS) increasing 46% to 90.4p.
Profit before tax added 37% to £881 million.
Strong cash generation resulted in a 46% hike to AB Foods’ interim dividend. Shareholders can expect a 20.7p cash return payable on 5 July.
Chief executive George Weston called them “a very strong set of financial results”.
“We are now benefitting from the restoration of some normality in our markets and in our supply chains…
“Looking ahead, we continue to invest with discipline to build further sustainable growth. Geopolitical risks remain, of course, and the consumer has yet to fully emerge from cost of living pressures.
“But the group is well positioned to deliver good returns to shareholders."
7.11am: Blue chips to surge another 40 points
The FTSE 100 is tipped to rally to another all-time high today after smashing records on Monday.
Blue chips rallied 128 points – over 1.6% – throughout the day to close at a record 8,023, thanks to a relief rally as Middle East tensions appeared to have simmered down for the time being.
Futures contracts have the footsie adding another 40 points to 8,073 when markets open at 8am.
On today’s company earnings calendar, Primark owner Associated British Foods PLC (LSE:ABF) will shortly have its interims out, while Jupiter Fund Management PLC (LSE:LON:JUP), Taylor Wimpey PLC (LSE:TW.) will be presenting their trading updates.
Big Tech earnings in the US will get underway later, with Tesla Inc (NASDAQ:TSLA) reporting in the midst of encroaching Chinese competition and a mounting pricing war.
Spotify, General Electric (NYSE:GE), Visa (NYSE:V), PepsiCo (NASDAQ:PEP) and Philip Morris (NYSE:PM) will also be reporting.