FTSE 100 closes in the red for first time this year
Finishing at 7,694.49, it was the first day that the index has closed down so far this year.
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Your support makes all the difference.The retail sector weighed on London’s top stock index on Tuesday, pulling it down from recent highs as some traders locked in the profits they had made in recent weeks.
The FTSE 100 closed the day down, breaking back below the 7,700 mark following a strong week from the index.
Finishing at 7,694.49, a drop of 30.45 points, it was the first day that the index has closed down so far this year.
The move downwards was driven in part by the retail sector as Next, Ocado, Frasers and B&Q-owner Kingfisher rubbed shoulders down at the bottom of the table.
It came after AO World reported on Tuesday. Despite what initially looked like a positive update, the company’s shares ended the day down 5.4%.
“Online electrical retailer AO World initially saw its shares rise sharply to a 6-month high, after upgrading its full year Ebitda (earnings before interest, tax, depreciation and amortisation) guidance to between £30 million and £40 million, however the pop didn’t last long, with the shares slipping back,” said CMC Markets analyst Michael Hewson.
“Management cited progress on reducing costs during Q3 with revenues still set to show a fall of 17.2% from last year, in line with previous guidance.
“This inability to hang onto those gains appears to have permeated into the rest of the retail sector, with Next and Frasers Group giving up some of their early year gains.”
In Europe, the Dax index closed down 0.1% while Paris’s Cac 40 dropped 0.6%. In New York, both the S&P 500 and the Dow Jones were trading up around 0.1% shortly after markets closed in Europe.
On currency markets, the pound dropped 0.2% to 1.215 dollars, and 1.132 euros.
In company news, recruitment firm Robert Walters has said that a difficult global jobs market is likely to have muted its earnings growth over the year.
It revealed that its profits are still on track to hit a record, but that it is likely to come in below market expectations after tougher economic conditions “softened recruitment activity” across its global markets.
Shares in the firm were down by 3.3%.
On the other hand, it was a cheerful Christmas for retailer Card Factory which lifted its full-year earnings outlook as shoppers returned to the high street over the festive season.
While store sales jumped, online sales slumped by more than a quarter year-on-year, after experiencing a boom in online shopping during the pandemic.
But the positive update was enough to tempt investors and its share price was up by 5%.
The biggest risers on the FTSE 100 were Admiral, up 64p to 2,272p, Convatec Group, up 5p to 246.2p, Antofagasta, up 28p to 1,754.5p, Rightmove, up 8p to 553.2p, and Abrdn, up 2.7p to 196.6p.
The biggest fallers on the FTSE 100 were RS Group, down 46p to 906.5p, British American Tobacco, down 131p to 3,153.5p, Airtel Africa, down 4p to 110.5p, Ocado Group, down 22.8p to 720.4p, and Next, down 188p to 6,266p.