BUSINESS LIVE: UK loans rise; JD Sports buys Hibbett; ABF sees ‘significant growth’

London-listed shares continued to rise to new record highs this morning, helped by a weaker pound and positive company updates, as investors focus on US tech giants’ profits this week.

Rising commodity prices, a falling pound and gains in defense stocks have driven the FTSE 100 higher this year, as investors take advantage of cheaper valuations of UK shares.

Associated British Foods has risen 7.7 per cent to the top of the FTSE 100 after the Primark owner forecast ‘significant growth’ in full-year profits as it reported a 39 per cent rise in the first half.

Other retailers such as J Sainsbury and Tesco are up more than 1 percent each, while Ocado added 4 percent, after data showed UK food price inflation fell for the 14th month in a row in April, partly driven by an increase in the number of supermarkets. ‘promotional activity.

JD Sports Fashion has posted a gain of 2 percent after the sportswear retailer proposed to acquire American athletics fashion retailer Hibbett Inc. for approximately $1.1 billion.

The co-founder of CVC Capital Partners could be in line for a £130m payday if the company he helped build 30 years ago goes public.

Donald Mackenzie will cash in a large part of his 7 percent stake when the private equity firm goes public in Amsterdam later this week.

British food price inflation fell for the 14th month in a row in April, partly due to an increase in supermarket promotional activity, industry data showed on Tuesday.

Market researcher Kantar said annual food price inflation in the four weeks to April 14 was 3.2 percent, up from 4.5 percent in the previous four-week period.

Kantar said items purchased on sale represented 29.3 per cent of supermarket sales – the highest non-Christmas level since June 2021.

“This emphasis on promotions, combined with falling prices in some categories such as toilet paper, butter and milk, has helped reduce inflation at the checkout in grocery stores,” said Fraser McKevitt, head of retail and consumer insights at Worldpanel. Kantar, said.

But he noted that prices were still rising rapidly in markets such as sugar and chocolate confectionery and chilled fruit juices and drinks.

Richard Hunter, head of markets at Interactive Investor,

‘For the full year, the group expects growth to be significantly above expectations, both in terms of cash generation and profitability. Such optimism about the immediate prospects allowed for another increase in the dividend, with the expected yield of 2.7% including specials remaining somewhat banal in comparative terms, but nevertheless showing a clear direction.

‘The latest £500 million share buyback program is running in the background, which should provide some support to the share price.

‘The group is aware of potential bumps in the road ahead including, but not limited to, consumer pressures, geopolitical concerns, supply chain disruptions currently under control and the uncertainty that lies ahead several general elections this year could bring.

‘Nevertheless, the diversified nature of AB Foods’ business provides some certainty against most economic outcomes, while at the heart of its current success is a Primark business that continues to thrive both at home and abroad.’

London’s stock market is facing a ‘death by a thousand cuts’ as two more FTSE 250 companies bow to foreign takeovers.

On another frenzied day of deal-making on the Square Mile, construction company Tyman and music group Hipgnosis backed proposals that would see them bought and removed from the UK market.

Britain’s Debt Management Office (DMO) has stepped up its government bond issuance plans in the current financial year after official OBR data showed a larger budget deficit than forecast in the last financial year.

Government bond sales for 2024/2025 are now forecast at £277.7 billion, an increase of £12.4 billion on the order published last month.

Most of the revision reflects the fact that the government’s cash deficit in the 2023/2024 financial year was £10 billion higher than forecast in the March spring budget, according to official figures published earlier on Tuesday.

Retailers guided the FTSE 100 to a record high yesterday.

On a positive day for investors, London’s blue chip index rose 1.6 percent, or 128.02 points, to 8,023.87.

This left the FTSE 100 above its previous high of 8014.31 set in February last year.

The mid-cap FTSE 250 index was also on the rise, up 1.1 percent, or 208.09 points, to 19599.39.

High Street chains and major supermarkets led the way as optimism flowed through City trading floors.

Primark owner Associated British Foods expects “significant growth” in profitability this year after first-half profits rose 39 percent, partly driven by margin recovery at the clothing chain as it opens new stores.

The group, which also owns major sugar, grocery, farming and ingredients companies, said adjusted operating profit, its key profit measure, was £951 million in the six months to March 2, while sales rose 2 percent to £9.7 billion.

“The group has delivered a strong performance in the first half of the year and is on track to deliver significant growth in both profitability and cash flow generation, earlier than expected at the start of this financial year,” the report said.

The company previously forecast “meaningful progress” in full-year profits.

Primark’s first half sales rose 7.5 percent to £4.5 billion, with comparable sales up 2.1 percent and margin recovery from 8.3 percent to 11.3 percent.

JD Sports Fashion plans to acquire US athletics fashion retailer Hibbett for around $1.08 billion (£899 million), as the British sportswear retailer expands in the southeastern US.

JD Sports, Britain’s largest sportswear retailer, will pay $87.50 per Hibbett share in cash, marking a premium of around 20 percent to the US company’s last closing price.

The Bury, Greater Manchester-based company said it expects to finance the deal and refinance Hibbett’s existing debt through its existing US cash resources of $300 million and a $1 billion expansion of existing banking facilities.

The expanded group would have achieved combined sales in North America of around £4.7 billion, JD Sports said, adding that the region’s contribution to total sales would rise from the current 32 percent to around 40 percent.

The FTSE 100 closed at a record high yesterday as easing tensions in the Middle East and hopes of interest rate cuts in Britain sent stocks soaring.

On a banner day for savers with money tied up in the stock market through pensions, Isas and other investments, the blue chip index closed up 1.6 per cent, or 128.02 points, at 8023.87.

That eclipsed the previous record of 8,014 in February last year.

Government borrowing was £6.6 billion higher than forecast last year, reaching £120.7 billion as wages and benefits soared, new data from the Office for Budget Responsibility shows.

Public sector net debt was £7.6 billion less than the previous year in the 12 months to March 31, but higher than OBR forecasts of £114.1 billion.