FTSE 100 higher as Nasdaq smashes through 20,000, Currys upbeat despite Budget pressures, C&C appoints soft drinks industry legend, Boohoo continues Frasers battle, Drax agrees US aviation deal

“The FTSE 100 ticked higher on Thursday after US stocks chalked up another landmark. The Nasdaq index yesterday smashed through the 20,000 barrier for the first time,” says Dan Coatsworth, Investment Analyst at AJ Bell.

“The catalyst for the tech-driven rally was a benign inflation reading. This fuelled expectations for an interest rate cut when the Federal Reserve meets next week.

“The Fed is in tricky position given the uncertainty over the incoming Trump administration’s agenda and the scope for tariffs to revive inflationary pressures.

“In hitting this latest milestone, the Nasdaq has nearly doubled in two years. To put that into context, the FTSE All-Share is up around 11% over the same timeframe.

“Later today, the European Central Bank is expected to cut interest rates for a fourth time in the current cycle, in the face of a Eurozone economy which is teetering on the brink of a recession. The rumbling political crises in France and Germany only add to the tricky backdrop.”

Currys

“Currys’ board has been vindicated in its decision to fight off bid interest from US investment group Elliott. Half-year results show growth in profits and cash flow, it has increased UK market share, and trading remains resilient despite choppy conditions for UK shopkeepers.

“Rachel Reeves hasn’t done any favours for UK retailers given how Budget decisions will push up costs. Currys says her actions will cost it £32 million which means it will have look harder for additional cost saving measures. Unfortunately for the consumer, price hikes are on their way as Currys implies it will have to pass on some of the extra costs.

“The new government was meant to have created a more favourable environment for consumers and businesses, sorting out public finances and accelerating economic growth. So far that remains a story for another day – the journey to reaching that goal is going to be turbulent. It means ongoing uncertainty when it comes to consumer spending.

“Fortunately for Currys, there is a structural shift in the market which could be its saving grace. The introduction of AI laptops has created a new ‘must-have’ electronic product category, driving consumers to upgrade their hardware. Demand is growing for these products and Currys is laughing all the way to the bank. As more AI facilities are rolled out across phones and laptops, consumers will want to make sure they have devices with enough power to get the most out of this technology.”

C&C

“Having run soft drinks group AG Barr for 22 years, Roger White is now moving to Magners’ maker C&C for a drop of the hard stuff. During his time at AG Barr, White oversaw the acquisition of cocktail company Funkin, adding an alcoholic flavour to the group’s portfolio. That broadened his market experience and will come in handy at C&C which is active in beer, cider and wine.

“The market wasn’t immediately convinced at his appointment, given how the share price didn’t react to the news. However, decades of experience in the drinks industry will be invaluable and C&C needs some fresh thinking given how the business seems to be stuck in the mud.”

Boohoo

“Boohoo continues to beat the drum that it doesn’t want 25.46% shareholder Frasers muscling in on how the business is run.

“Having flagged the view of proxy adviser ISS earlier this week that investors shouldn’t vote in favour of Frasers’ push to get two board seats, Boohoo is now doing the same for Glass Lewis’ latest report. This proxy adviser also recommends that shareholders vote against Frasers’ resolutions.

“With eight days to go until the shareholder meeting, there is plenty of time for Frasers to retaliate and step up its campaign to win over Boohoo investors. Frasers doesn’t do things by halves, so reach for the popcorn and wait for the drama to unfold.”

De La Rue

“Bank note printer De La Rue has been badly hit by a shift away from cash which accelerated during the pandemic. That’s reflected in a drop in profit for the first half of its current financial year.

“However, there were some signs of life in its latest update with the order book increasing to a five-year high. Crucially, this is a timeframe which takes us back to before Covid.

“Having announced the sale of its authentication business in October, the company will now be exclusively focused on its currency arm and there is significant pressure on the current management team to demonstrate the business still has life in it despite the structural headwinds it faces.

“The authentication sale will at least provide the business with a useful injection of cash and give it some breathing space.”

Drax

“The airline industry faces a big challenge if it wants to reduce emissions and boost its sustainability credentials.

“UK power firm Drax looks set to play a part in this structural shift by supplying biomass pellets to US-based Pathway Energy as part of the latter’s sustainable aviation fuel project.

“Drax, which has faced scrutiny over its green credentials in the past, has the option to invest directly in the project and could become a strategic partner on other developments too.

“This will not have an overnight impact on the business, with construction on the first facility not expected to commence until 2026.”

These articles are for information purposes only and are not a personal recommendation or advice.