Despite the cold, people were queueing up outside Primark on Oxford Street in London yesterday morning. The usual suspects no doubt imagined one day telling their grandchildren about how they were first in line for the high street’s “grand reopening”.
Yet for all the hype and excitement in the run-up to the latest road map milestone, in which pub gardens and shops opened for the first time in months, it wasn’t reflected in the share prices of London’s listed retail stocks.
Frasers Group, formerly known as Sports Direct, slipped 12¼p, or 2.4 per cent, to 491¾p. Next, the seller of clothes and homeware, fell 196p, or 2.4 per cent, to £81 and Marks and Spencer, the high street stalwart, slid 2p, or 1.3 per cent, to 154¾p.
Those retailers that have profited from the pandemic sustained even bigger losses. AO World, the online white goods group, lost 17¼p, or 5.2 per cent, to 310¾p and Kingfisher, the B&Q owner, shed 9¼p, or 2.7 per cent, to 334¾p.
That the sector flopped on its big day is perhaps no real surprise after its recent run. The market, after all, only looks forward. The FTSE 350 retailers’ index has leapt by more than 10 per cent over the past month to hit its highest level in almost five years.
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UBS’s prediction that fast-fashion sales could fall by a third in the next decade as consumers start to consider the environment had little effect on Asos and Boohoo, the online clothes retailers. Asos fell 120p, or 2.2 per cent, to £52.40 while Boohoo rose 7½p, or 2.2 per cent, to 51½p.
Travel stocks were buffeted by a bearish research note from HSBC, which chopped its forecasts for the sector on concerns that governments will want to stop people from heading abroad this summer.
“We think travel — particularly international travel — struggles to gain traction with policymakers,” said Andrew Lobbenberg, a transport analyst at HSBC. “It is the issue of economic benefits accruing elsewhere and the fear of variants that is proving the challenge to the aviation sector achieving liberalisation.”
The no-frills airline easyJet, which Lobbenberg downgraded to “hold”, descended 37½p, or 3.9 per cent, to 935¼p and Tui, Europe’s biggest holidays group, fell 17p, or 4.3 per cent, to 372p.
The FTSE 100, having hit its highest mark in over a year last week, dipped 26.63 points, or 0.4 per cent, to 6,889.12, while the FTSE 250, London’s second tier index, eased back 97.71 points, or 0.4 per cent, to 22,153.55 after its run to record highs.
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There were few big winners yesterday, although banks enjoyed a decent session. Barclays nudged 2½p, or 1.3 per cent, up to 188p and Lloyds, Britain’s biggest mortgage lender, rose 1¼p, or 2.6 per cent, to 44½p after Deutsche Bank predicted “a good first-quarter results season” for the sector after the rise in bond yields this year. Banks tend to benefit when yields and interest rates are higher.
Elsewhere, Cake Box, the chain of cake shops, zipped 7p, or 2.8 per cent, up to 261p after record sales in the year just gone. The group has opened 24 stores over the past 12 months and sales were boosted after it joined food delivery platforms during lockdown.
Touchstone Exploration jumped 26p, or 28.3 per cent, to 117½p as one of its wells at the Ortoire block in Trinidad & Tobago flowed better than hoped for. On average, the well yielded just shy of 4,300 barrels of oil equivalent per day.
That is a lot of oil for a company whose production is closer to 1,500 barrels each day.
GameStop’s quest for new chief
The video games chain GameStop is reportedly searching for a new chief executive as it refocuses on digital retail and technology.
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The American retailer at the heart of an online market frenzy earlier this year is working with a headhunter to find a replacement for George Sherman, according to Reuters, after a string of other senior appointments in recent months.
Ryan Cohen, the activist investor leading efforts to overhaul the chain and pivot away from bricks-and-mortar retail, has been lined up to become its chairman. He owns about 13 per cent of the Grapevine, which is based in Texas and has about 5,000 shops in ten countries.
While shares in GameStop have fluctuated wildly, they are up more than 800 per cent this year. They were trading down $17.23, or 10.88 per cent, at $141.09 in New York last night.
GameStop did not respond to a request for comment.
Cohen, who co-founded Chewy, the digital pet food retailer, has played a key role in GameStop’s search for executives to focus on ecommerce. Since the turn of the year it has announced a series of senior appointments, including many who have worked at Amazon or Chewy.
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Wall Street report
Stocks slipped from last week’s record highs as investors focused on the economic recovery as well as concerns about inflation and rising bond yields. The Dow Jones industrial average drifted off 55.2 points to close at 33,745.40.
