JD Sports warns on profits, Tritax EuroBox signs Stockholm lease

London open

The FTSE 100 is expected to open 12 points higher on Thursday, having closed down 0.51% on Wednesday at 7,682.33.

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Sports fashion retailer JD Sports on Thursday delivered a profit warning after second-half trading missed expectations due to milder autumn weather and heavier discounting over the peak holiday shopping season. The company said the "elevated level of promotional activity" during the peak trading period means that full-year gross margins would be slightly lower than last year, leading it to lower its adjusted pre-tax profit guidance to £915-935m, from £1.04bn at the half-year stage.

Tritax EuroBox has signed a new five-year lease agreement for a 5,007 square metre unit in its two-unit development near Stockholm's Arlanda airport, it announced on Thursday, with a leading Scandinavian photovoltaic company. The lease, beginning in March, includes 100% CPI indexation, an annual review, and an option for a further five-year extension, with rent set at 3% above the estimated rental value as of September and 20% above the underwrite level.

UK fashion retailer Next lifted annual guidance after better-than-expected full-price sales during November and December. Full-price sales in the nine weeks to December 30 rose 5.7% year-on-year, £38m better than previous guidance of a 2% rise. Annual pre-tax profit increased by £20m to £905m. Of the £20m increase, £17m came from the sales beat to date and £3m from an upgraded forecast for full-price sales in January.

Newspaper round-up

Several of the world’s biggest carmakers lobbied the UK government to try to weaken or delay rules to accelerate electric car sales and cut Britain’s carbon emissions. Toyota, Jaguar Land Rover (JLR) and Nissan were among the companies to ask for delays in enforcement of the zero-emission vehicle (ZEV) mandate that obliges them to sell increasing proportions of electric cars or face heavy fines, according to documents seen by the Guardian. – Guardian

The bosses of Britain’s biggest companies will have made more money in 2024 by Thursday lunchtime than the average UK worker will earn in the entire year, according to analysis of vast pay gaps amid strike action and the cost of living crisis. The High Pay Centre, a think tank that campaigns for fairer pay for workers, said that by 1pm on the third working day of the year, a FTSE 100 chief executive will have been paid more on an hourly basis than a UK worker’s annual salary of £34,963, based on median average remuneration figures for both groups. – Guardian

Depressed UK share prices have led to more foreign buyers acquiring London-listed companies, according to a top City broker. Peel Hunt said there was a surge in overseas acquirers taking advantage of cheap British stocks last year, which sparked a rise in takeover premiums. The proportion of buyers from overseas rose to 55pc in 2023, breaking the long-run trend of a 50/50 split between UK and non-UK buyers. – Telegraph

Labour shadow ministers are pressing the government over national security risks from the £18 billion merger between Vodafone and Three in the UK. The proposed combination of Vodafone and Three, owned by the Hong Kong-listed conglomerate CK Hutchison, would create Britain’s biggest mobile network. However, it has triggered an initial investigation by the Competition and Markets Authority and is subject to government approval under the National Security and Investment Act. – The Times

The taxman is expected to be repaid £5.9 million in overdue VAT after the collapse of Joules. The fashion and lifestyle brand is seeking to repay its creditors and the sale of its assets is said to be on course to deliver a full repayment of tax due to HM Revenue & Customs. Joules called in administrators when it failed to secure a refinancing in November 2022, putting about 1,600 jobs at risk. The company had hoped to raise equity and to cut its rental bill using a company voluntary arrangement before appointing Interpath to find a buyer for the business. - The Times

US close

US stocks dropped sharply on Wednesday with the Dow falling nearly 300 points after minutes from the latest Federal Reserve policy meeting failed to give conclusive evidence of when the central bank might start to cut interest rates.

The Federal Open Market Committee (FOMC) discussed at its 12-13 December meeting that members' inflation outlooks mean interest-rate cuts would likely "be appropriate by the end of 2024".

But the path was "associated with an unusually elevated degree of uncertainty" and that rate hikes could be on the cards if things take a turn for the worse.

Nevertheless, minutes showed that policymakers talked about the "diminished" upside risks to inflation, while some participants were worried about how long the current restrictive monetary policy should continue given the "downside risks to the economy" from elevated interest rates.

The Dow finished 285 points lower at 37,430.19 (-0.8%), pulling back from another record high, while the S&P 500 declined 0.8% and the Nasdaq dropped 1.2%.