By Chris Dorrell
London’s FTSE indexes dipped in opening trade as falling oil prices dragged down the index’s energy giants, but shares in Marks and Spencer (M&S) rocketed after reinstating a dividend.
The FTSE 100 opened slightly lower at 7,406.97, while the FTSE 250 dropped 0.29 per cent to 17,711.06.
“There is still a certain amount of nervousness hanging around despite the increased confidence recently that rate cuts in the US could finally be in sight,” Derren Nathan, head of equity research at Hargreaves Lansdown said.
“Stocks may well pause for breath as investors balance the hope for rate cuts with building financial stresses in the economy,” he continued.
Looking forward into the day, markets will be looking out for a speech at 9.30am from Andrew Bailey, governor of the Bank of England. US Federal Reserve chair Jerome Powell also speaks today.
On the FTSE 100, M&S rocketed to the top of the bluechip index, up almost 10 per cent, after its profits rose to £360.2m.
As a result of its strong results, the retailer said it would return to paying a “modest dividend” — its first in four years.
“The yield is relatively low, but it marks a moment of significance for the group, and it’s a real statement of confidence around the outlook for the business from M&S’s management,” Aarin Chiekrie, equity analyst at Hargreaves Lansdown said.
On the FTSE 250, ITV shares sank more than seven per cent as it revealed advertising revenue had fallen seven per cent in the year-to-date.
The broadcaster said: “In light of these conditions, total content spend for the full year will be £10 million lower than previously guided at around £1,290 million as we rephase content into 2024.”
“ITV is at the mercy of creaking economic conditions,” Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown said.
“Companies are snapping marketing purses shut as they buckle down for the unknown over the coming months, and that makes moving ITV’s advertising top-line in the right direction a very difficult task,” she continued.
