11th Mar 2025 11:54
(Alliance News) - Blue-chip European stocks struggled for direction on Tuesday, heading into the afternoon mixed, with the FTSE 100 on the verge of suffering its worst run since September.
London's large-cap index is on track for a sixth decline on-the-spin, its worst streak since it feel every trading day from August 30, up to and including September 6.
The FTSE 100 index traded down 24.55 points, 0.3%, at 8,575.67. It is up 4.9% so far this year despite the recent losing streak.
The FTSE 250 was up 43.15 points, 0.2%, at 19,918.33, and the AIM All-Share was up 0.53 of a point, 0.1%, at 683.16.
The Cboe UK 100 was down 0.3% at 856.47, the Cboe UK 250 was up 0.2% at 17,322.93, and the Cboe Small Companies fell 0.9% at 15,162.35.
In Paris, the CAC 40 was flat, while the DAX 40 in Frankfurt added 0.3%.
New York stocks are called higher. The Dow Jones Industrial Average and S&P 500 are called up 0.4%, clawing back a fraction of Monday's sell-off. The Nasdaq Composite is called to open 0.5% higher.
"After the big sell off, comes a modest recovery. Monday's price action was brutal. The sell off pushed the Nasdaq close to correction territory, and the index is down nearly 10% YTD. The Trump trade unwind has been brutal for stock markets, especially in the US, but the impact has not been even. For example, on the S&P 500, Tesla has fallen nearly 45% YTD and is the weakest performer on the index. In contrast, CVS Health Corp is higher by 45%. There is a clear preference for defensive sectors like healthcare in the US right now," XTB analyst Kathleen Brooks commented.
"President Trump has elevated his political aims above the medium-term outlook for the economy. On top of this he is pursuing two disruptive political aims at once: 1, tariffs and 2, cutting the size of government. If he had chosen one clearly defined policy to start with then the markets may have adjusted better to Trump's second term as president. Instead, the 'bull in a china shop' approach to economic policy has spooked investors. The question is, will it continue to spook consumers, the life blood of the US economy?"
Sterling traded at USD1.2932 on Tuesday afternoon, rising from USD1.2897 at the time of the London equities close on Monday. The euro rose to USD1.0895 from USD1.0838. Against the yen, the dollar was largely flat at JPY147.66 from JPY147.27.
High-stakes talks between senior delegations from Ukraine and the US on how to end Kyiv's three-year war with Moscow opened in Saudi Arabia on Tuesday.
The Ukrainian presidency's chief of staff Andriy Yermak said on Tuesday that discussions with the US delegation in the Saudi port city of Jeddah had begun positively.
"The meeting with the US team started very constructively, we continue our work," Yermak, who was attending the most senior meeting with US officials since a dramatic fallout at the White House last month, said on social media.
A barrel of Brent rose slightly to USD70.08 early Tuesday afternoon, from USD69.54 at the time of the London equities close on Monday, while gold rose to USD2,914.44 an ounce from USD2,903.30.
In London, eyes were on shares in companies embroiled in the UK motor finance saga.
The UK Financial Conduct Authority on Tuesday said it is no longer planning a further update on its review into past use of motor finance discretionary commission arrangements in May.
This follows the judgement by the Court of Appeal in October, which raised the possibility of more widespread liability for the industry, and the subsequent announcement that the Supreme Court will hear an appeal against the Court of Appeal's judgement between April 1 to 3.
The Supreme Court is due to hear an appeal brought by car loan providers challenging the October ruling that sided with consumers who complained about "secret" commissions on car loans.
The judgment ruled that it was unlawful for banks to pay a commission to a car dealer without the customer's informed consent.
The decision opened the door for a potentially fresh wave of complaints from consumers who think they may have been mis-sold car finance in previous years.
The FCA intends to outline the next steps within six weeks of the Supreme Court's decision. This will include whether the FCA is proposing a redress scheme and if so, how it will take it forward.
Close Brothers shares fell 0.1%, Lloyds Banking Group shed 1.9% and Secure Trust Bank gave back 2.5%. However, Vanquis Banking Group rose 4.7%.
Vanquis provides motor finance through Moneybarn, Secure Trust through the V12 Vehicle Finance and Moneyway brands and Lloyds Banking through Black Horse.
Care REIT jumped 33%, giving it a market capitalisation of GBP448.6 million. The firm agreed to a GBP448 million takeover from US real estate investment trust CareTrust. NYSE-listed CareTrust, focused on seniors housing and healthcare-related properties, will pay 108p in cash per Care REIT share. It represents a 33% premium to Care REIT's closing price of 81.3p on Monday.
The London-listed owner of care homes and other healthcare properties deems the takeover price "fair and reasonable".
AJ Bell analyst Russ Mould commented: "Investors do not seem to be particularly interested in UK real estate plays, judging by the poor performance of the FTSE 350 Real Estate Investment Trusts (REITs) sector and the wide discounts at which many property plays trade relative to their asset value, but private equity and trade buyers continue to snap them up.
"Care's board is recommending the approach, just as Assura's management team now believes the increased KKR offer represents fair value for its shareholders. It will be interesting to see if these approaches flush out any more interest from would-be buyers of UK real estate assets, be they private equity or industry players, or institutional or retail investors."
boohoo shares fell 3.6%. It triumphantly declared "Debenhams is back" and the fast fashion retailer announced a rebrand.
It will "now go forward as Debenhams Group". The "reinvigorated" Debenhams is now the "majority contributor" to group profit, boohoo said.
"Debenhams is growing rapidly. The business model is stock-lite and capital-lite. It is very profitable and highly cash generative. For our consumers, Debenhams is once again becoming their destination of choice. It is an iconic British heritage brand with huge brand awareness and significant consumer trust," the firm said. "Our ongoing business review has confirmed that Debenhams, its business model and its technology is at the epicentre of our group going forward. It is the driving force of the business and will lead the group recovery. It is at the heart of the investment case. The successful Debenhams turnaround, led by Dan Finley, group chief executive officer, provides the blueprint for the wider turnaround of the group."
Debenhams had entered administration back in 2020. boohoo announced a deal in 2021 to acquire intellectual property of Debenhams from administrators.
boohoo said that for the full-year to February 2025, it expects to report revenue of GBP1.22 billion, a decline of 16% from GBP1.46 billion. Debenhams revenue rose 10% to GBP204.6 million from GBP186.0 million.
In addition, boohoo announced Phil Ellis will become its finance chief with immediate effect, replacing Stephen Morana.
"Phil is currently finance director of Debenhams and managing director of DebenhamsPay+. He has worked for the Group CEO, Dan Finley for 6+ years," the firm added. "Phil has extensive commercial finance experience in the retail industry and joined the group in 2022 as Finance Director of Debenhams, immediately prior to that he held senior financial roles at JD Sports for 6 years, and 7 years at The Very Group."
The planned name change requires shareholder approval, which it will pursue at a general meeting penned for March 28.
By Eric Cunha, Alliance News news editor
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