2nd Sep 2021 08:16
(Alliance News) - JD Sports Fashion on Thursday lamented the UK Competition & Markets Authority's announcement that the regulator has again provisionally prohibited the sportswear retailer's acquisition of peer Footasylum.
Back in May last year, JD Sports hit out at the monopoly regulator after the CMA flexed its muscles and blocked the retailer's GBP90 million acquisition of high street outfit Footasylum. In November, a Competition Appeal Tribunal ruling meant that the CMA had to reconsider its decision.
However, after reassessing the transaction, the CMA believes the merger could lead to a worse deal for shoppers.
"At this stage, the CMA's view is that blocking the deal, by requiring JD Sports to sell Footasylum, may be the only way of addressing these competition concerns," the regulator said.
JD said that it, nevertheless, remains committed to its transaction goal of improving Footasylum's resources, access to product and differentiated customer offering. It noted that the findings are provisional and will continue to make its case ahead of October's final report.
"We have made compelling submissions on the committed positioning of the global brands towards Direct to Consumer and the consequent impact on an extremely competitive marketplace. I am perplexed and again disappointed that these have been rejected. I am not sure what further evidence the CMA needs to appreciate the extent of this dynamic change which has been substantially accelerated by COVID-19," said JD Sports Chair Peter Cowgill.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.1% at 7,155.36
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Hang Seng: up 0.2% at 26,088.52
Nikkei 225: closed up 0.3% at 28,543.51
DJIA: closed down 48.20 points, 0.1%, at 35,312.53
S&P 500: closed marginally higher at 4,524.09
Nasdaq Composite: closed up 0.3% at 15,309.38
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EUR: down at USD1.1843 (USD1.1858)
GBP: down at USD1.3778 (USD1.3786)
USD: flat at JPY110.03 (JPY110.04)
Gold: up at USD1,814.60 per ounce (USD1,812.84)
Oil (Brent): up at USD71.45 a barrel (USD70.76)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Thursday's Key Economic Events still to come
11:00 CEST EU PPI
08:30 EDT US international trade in goods & services
08:30 EDT US initial jobless claims
10:30 EDT US EIA weekly natural gas storage report
12:00 EDT US monthly retail chain store sales index
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Footfall in UK retail destinations got to within 20% of pre-pandemic levels in August, numbers on Thursday showed, with the sector boosted by staycations. Compared to 2019's levels, footfall in UK retail destinations fell 19% in August, faring better than July's 24% plunge, data from Springboard showed. It was the first time since the start of the pandemic that footfall has been within 20% of pre-virus levels. In both high streets and shopping centres, footfall was 24% lower than pre-pandemic times in August. In retail parks, the decline was just 2.4%. "The popularity of staycations and daycations in August bolstered footfall, particularly in high streets," Springboard noted. "In large cities outside of the capital, the improvement in footfall in August was nearly double that in smaller high streets, putting them at a comparable level versus 2019 for the first time."
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The world's leading oil producers on Wednesday upheld a deal reached just over a month ago to boost output gradually despite US pressure to go further. After weeks of wrangling, members of the Organization of Petroleum Exporting Countries along with allies such as Russia – known collectively as OPEC+ – agreed in July to raise output by 400,000 barrels per day from August. The move is aimed at supporting a global economic recovery, which has been battered by the coronavirus pandemic – a crisis that sent oil demand plummeting last year. The videoconference on Wednesday of the 23 members of OPEC+ lasted less than an hour to "reaffirm the decision" taken in July, according to a statement by the group.
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New Yorkers were inundated by flash flooding and heavy rains Thursday as Storm Ida wrought further havoc on the northeast US, forcing airport closures and state of emergency declarations in their state and neighboring New Jersey. Ida slammed into the southern state of Louisiana over the weekend, bringing severe flooding and tornadoes as it blazed a trail of destruction north. New York governor Kathy Hochul declared a state of emergency as the remnants of the storm caused massive flooding in the US's financial and cultural capital, leaving the boroughs of Brooklyn and Queens inundated by the deluge. "Take shelter NOW. Flying debris will be dangerous to those caught without shelter. Move to a lower floor and stay away from windows," tweeted New York City's emergency notification body.
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BROKER RATING CHANGES
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BARCLAYS RAISES HOMESERVE TO 'OVERWEIGHT' (EQUAL WEIGHT) - PRICE TARGET 1160 (1200) PENCE
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JPMORGAN CUTS UNILEVER TO 'UNDERWEIGHT' (NEUTRAL) - PRICE TARGET 3850 (4200) PENCE
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COMPANIES - FTSE 100
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Barratt Developments said financial 2021 was a year in which the housebuilder made "excellent progress" and that it started the new financial year in a strong position. For the financial year ended June 30, revenue rose 41% to GBP4.81 billion from GBP3.42 billion a year ago and pretax profit was GBP812.2 million, up 65% from GBP491.8 million. The pretax profit figure was at the top end of the company compiled consensus range of GBP761 million to GBP812 million. During the period, Barratt completed 17,243 homes, up 37% from 12,604 completed last year and was in line with guidance given in July. Barratt declared a total dividend of 29.4 pence, having paid out nothing the year before. Turning to current trading, Barratt said its sales performance so far has been strong with forward sales as at August 22 of 15,734 homes, up from 15,660 homes at the same time last year.
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Melrose Industries said it was trading ahead of expectations, with better profit margins and scope on its balance sheet to return more cash to shareholders next year. For the six months to June 30, revenue rose to GBP3.54 billion from GBP3.39 billion last year and its pretax loss narrowed to GBP256 million from GBP720 million. Melrose declared an interim dividend of 0.75p per share, having skipped its payout last year. It did recently, however, unveil a GBP730 million return to shareholders after completing the sale of its Nortek Air Management division. "As with all its promises, Melrose has delivered its acquisition funding commitment to GKN pensioners early. We have scope on our balance sheet to return more money to shareholders next year and we are excited by the upcoming possibilities," said Chair Justin Dowley.
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Late Wednesday, FTSE Russell said grocer Wm Morrison Supermarkets and aerospace components maker Meggitt are to join London's blue-chip FTSE 100 index, according to the latest index review. The pair will replace food delivery platform Just Eat Takeaway.com and engineer Weir Group. Elsewhere, Endeavour Mining, Darktrace, Bridgepoint, Draper Esprit, Baltic Classifieds and Blackrock Throgmorton will be elevated to the FTSE 250. This will replace Temple Bar Investment Trust, Civitas Social Housing, Tullow Oil, Wickes Group and Avon Protection, which will all drop out of the mid-cap index. The changes are effective from the market open on Monday, September 20.
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COMPANIES - FTSE 250
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Central and eastern Europe-focused airline Wizz Air said it carried 3.6 million passengers at a load factor of 83.6% in August. The traffic figure was up 50% on a year ago, while load factor notched a 12.7 percentage point improvement on 2020.
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COMPANIES - MAIN MARKET AND AIM
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Irish budget airline Ryanair reported August traffic of 11.1 million at a load factor of 82%, operating over 71,000 flights in the month. August's stats marked an improvement on July, when it flew 9.3 million passengers at a load factor of 80%. It noted that the EU's Covid certificates has helped to stimulate air travel recovery.
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COMPANIES - GLOBAL
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Apple announced on Wednesday it will loosen some of its App Store policies, allowing media apps to steer customers directly to their websites without paying commission. The change, to be implemented early next year, is being introduced to end an investigation by the Japan Fair Trade Commission. The modification will spare so-called reader apps that provide digital content such as newspapers, books, music or video from having to use the App Store payment system and thus avoid paying a 30% commission. "We have great respect for the Japan Fair Trade Commission and appreciate the work we've done together, which will help developers of reader apps make it easier for users to set up and manage their apps and services, while protecting their privacy and maintaining their trust," Apple Fellow Phil Schiller said in a blog post.
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Two drugs made by AbbVie and Pfizer must now warn on the risk of serious illness or even death, US health watchdogs announced on Wednesday. Xeljanz and Rinvoq, arthritis drugs developed by Pfizer and Abbvie, respectively, were among three drugs listed by the Food & Drug Administration which cause an increased risk of serious heart-related events, including heart attacks, strokes, cancer, blood clots and death. A third, Olumiant, developed by Eli Lilly & Co, was also caught in regulatory cross-hairs. "This trial compared Xeljanz with another type of medicine used to treat arthritis called tumour necrosis factor blockers in patients with rheumatoid arthritis. The trial's final results also showed an increased risk of blood clots and death with the lower dose of Xeljanz," the FDA explained.
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Thursday's Shareholder Meetings
Blue Planet Investment Trust PLC - AGM
Carclo PLC - AGM
CloudCoCo Group PLC - GM re placing
Jet2 PLC - AGM
Safestay PLC - AGM
Wameja Ltd - GM re scheme meeting
Watches of Switzerland Group PLC - AGM
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By Lucy Heming;Â [email protected]
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