Having spent most of the day seeking direction, UK investors took the hint from their US counterparts and banked some of yesterday’s heavy gains.
Fashion chain Next was one of the day’s biggest fallers, after a cautious trading statement. The company said “despite a good final week before Christmas, November and December sales were disappointing”.
The firm’s Retail unit saw sales fall 2.7% in the period from August 1st to December 24th versus the corresponding period the year before, while Directory sales improved by 16.9%. Sales for the Next brand overall rose 3.1%, in line with – but in the bottom half of – the full year guidance range given in November of between 2.5% and 4.0%.
Both UBS and Singer Capital Markets suggested that earnings estimates for Next could be trimmed by around 3% as a result of the downbeat outlook for 2012.
Singer warned against interpreting Next’s performance as being representative of the High Street’s showing as a whole over the Christmas tradng period.
Another blue-chip stock set to experience a reduction to earnings forecasts is defence contractor BAE Systems, which said that renegotiation of its Typhoon jet fighter contract with Saudi Arabia is taking longer than expected.
Pizza delivery firm Domino’s Pizza saw a slow-down in year-on-year like-for-like sales growth in the final quarter of 2012, but this was expected, with the company facing tough comparatives, and the company’s new Chief Executive Officer, Lance Batchelor, said the company will meet profit expectations for 2011.
The revolving door to the board room at troubled package tour firm Thomas Cook is set to get more use again. Three of the firm’s non-executive directors are set to leave in February. The announcement comes less than a month after Frank Meysman took over as Chairman of the company, and it looks like he is beginning to mark out his territory.