MARKET REPORT: Sofa, as good as DFS, defies retail downturn
The High Street may have had an awkward start to the Christmas quarter, but DFS revealed it was looking lovely.
The furniture retailer bucked the trend by indicating that recent better trading has continued in the last financial year.
In a brief update, the banking firm said the improved trading seen in the final quarter of the last fiscal year has continued into the first 20 weeks of the current period.
Orders have continued to grow in line with expectations, while further progress has been made in reducing costs.
DFS accompanied the update with the surprise appointment of Marie Wall, formerly of Imperial Brands, as interim Chief Financial Officer. Wall will join on December 2 and ensure a smooth transition from John Fallon, who leaves on January 17.
Analysts at Jefferies raised their price target for DFS from 140p to 170p and reiterated their buy rating. Shares rose 1.7 percent, or 2.2p, to 135p.
Nice position: DFS indicated that recent better trading has continued in the last financial year
That happened despite official figures yesterday showing retail sales fell in October. The weak British data reinforced expectations that the Bank of England could cut rates further this year, boosting London benchmarks.
The FTSE 100 closed 1.4 percent, or 112.81 points, higher at 8,262.08, while the FTSE 250 closed 1.1 percent, or 231.77 points, higher at 20,581.69.
Rate-sensitive housebuilders were in demand: Vistry gained 3 per cent, or 18.5p, at 643p, Berkeley Group gained 1.6 per cent, or 46p, at 4322p, and Taylor Wimpey rose 2 per cent, or 2.5p, at 129.65p . .
But banks were weaker on recession worries, with Barclays down 2.1 percent, or 5.45 cents, to 257.2 cents, and Lloyds down 1.1 percent, or 0.6 cents, to 54. 42 cents.
Elsewhere, JD Sports lost 2.1 per cent, or 1.98p, to 93.46p, after falling following a profit warning on Thursday, when analysts at JP Morgan cut their rating on the stock to ‘neutral’.
Unilever gained 3.3 percent, or 150 cents, to 4,692 cents, as the consumer products giant confirmed it remains on track to spin off its ice cream business and deliver on its productivity boost program by the end of 2025.
In the AIM market, Tavistock Investments rose 11.3 per cent, or 0.4p, to 3.95p, as the financial advice and investment management provider said it has a substantial level of funding in place to refocus its business after two disposals .
Learning Technologies rose 2.3 percent, or 2.1 cents, to 92.3 cents, after the digital learning and talent management company extended a deadline to December 6 for US private equity firm General Atlantic Service to announce a resolution to announce to make a bid or withdraw his bid.
Ferro-Alloy Resources rose 3.1 percent, or 0.2 cents, to 6.7 cents after unveiling a promising development for its carbon black replacement, which it believes has significant sales potential in the market for sustainable materials.
But Webis Holdings fell 68.8 percent, or 0.28 cents, to 0.13 cents, after the gaming and technology company announced proposals to cancel its listing on AIM, which the company’s board said will reduce costs and protect shareholder value.
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