Daily market update: Inditex, Legal & General, 4imprint, Porsche

“The winds keep blowing in different directions on tariffs that it is impossible for markets to establish the lay of the land,” says Russ Mould, Investment Director at AJ Bell.

“Donald Trump keeps moving the goal post and investors are getting fed up. Metal tariffs are today’s special on the menu and they’ve been a major catalyst for many of America’s trading partners to retaliate with tariffs on other goods.

“Trump is essentially sticking with the same message: tariffs make goods imported into the US more expensive and that will drive Americans to buy more goods domestically. Critics says it’s not that simple and that tariffs will ultimately raise prices for consumers and businesses in the US and hurt the economy.

“It’s no wonder share prices have been bobbing up and down faster than a boat in a storm. We could be looking at one of the biggest years in a long time for corporate profit warnings. The next results season will be littered with uncertain outlook statements, and that’s all down to a president who has only been in office for seven weeks.

“If that’s not enough for investors to worry about, we’ve got inflation figures later today from the US. These will be watched closely by the market to see how the Federal Reserve might act next with interest rate decisions.

“JD Sports, Primark-owner Associated British Foods and Next retreated after negative read across from Inditex’s results. Fears of a slowdown in the retail sector were to blame.”

Inditex

“A slowdown in Inditex’s sales growth is reason to worry as it implies consumers aren’t feeling as confident with opening their wallets. The uncertain backdrop is creating havoc for companies across multiple industries and retail is near the top of the list.

“Inditex is one of the few retailers that act as economic bellwethers. Owner of much-loved brands Zara, Bershka and Massimo Dutti, the company has a reputation for good quality clothes at fair prices. They might not be the cheapest, but you know they’ll last a while and look good.

“Offering a mix of smart and casual clothes makes it a retailer of choice for two customer streams. It appeals to people seeking cheaper alternatives to expensive shops and to individuals wanting something better than offered by the low-price fast fashion chains.

“That twin trading up and trading down dynamic has worked wonders, particularly with Zara, yet the sales slowdown for Inditex implies that some of its customers are either worried about their finances, the economy or both.

“With so much negativity in the news, it’s no wonder individuals are starting to wonder if they really need that new top or dress. They might feel it is better to hold on to that money just in case something nasty comes around the corner.

“Whereas some companies would hide under a rock when times get tough, Inditex is ploughing ahead with investing its technology, logistics capabilities and doing up physical stores. It is also continuing to open new shops. That’s a sign that Inditex has its eye on the longer-term prize and can use its financial strength to get one up on the competition.

“Some would say this approach is wise. However, investors remain fixated on the short-term and have focused on the slowdown, hence the negative share price reaction to the results.”

Legal & General

“Insurance firm Legal & General was not able to salve the pain of worse-than-expected numbers with a bumper buyback and dividend increase.

“However, results were only modestly below forecasts and the company’s pledge to return more than £5 billion – nearly half its current market value – to shareholders over the next three years will have grabbed investors’ attention.

“It continues the overhaul which CEO Antonio Simoes has led since taking over from Nigel Wilson last year, with the sale of housebuilding division Cala and its US protection arm helping to fund its largesse in terms of returning capital.

“The decision to focus on three core divisions – institutional retirement, asset management and UK retail pensions and protection – makes the business easier to understand for investors. The corporate investments arm shows the bits of the group which are currently in the exit lounge.

“Legal & General is seeing strong growth opportunities in the pension risk transfer market – essentially taking over big company’s pensions schemes.”

4imprint

“Promotional products business 4imprint does nearly all of its business in the US and its latest numbers offer evidence of uncertainty caused by the new administration’s tariff policy.

“4imprint sells a wide range of promotional products like branded bags, pens and stationery to companies in North America, but rather than manufacturing the goods it sells, it outsources the work to third parties which means it has limited capital needs. Despite being a leading player, it also has a relatively small share of what is a fragmented market.

“Sentiment towards 4imprint and its performance have always been closely tied to US GDP so speculation about a recession in the world’s largest economy is unhelpful.

“This has been reflected in recent share price weakness and today’s results put the stock under further pressure as the outlook statement confirmed the market’s fears.

“The company noted that orders were down in the first two months of 2025 compared with the same period in 2024 and said it was possible market conditions and specifically ‘tariff impacts’ could persist through the year.

“4imprint might hope that should tariffs work as intended and domestic US businesses prosper, it will do so too, but for now uncertainty reigns.”

Porsche

“Porsche’s experience of listing on the stock market has been akin to a motorist joining the M25 on a wet night in February at rush hour.

“Conditions have been tricky and the shares have been stuck in reverse, with the luxury motoring brand forced to cut returns targets again.

“The whole industry was already in a difficult place as it dealt with a mismatch between regulation around the transition to electric vehicles and uneven demand for EVs among consumers, as well as mounting competition from China and weak consumer sentiment.

“At Porsche, this has been compounded by supply chain issues and delays in the roll-out of new models. Now tariffs have been added to the mix it looks even harder for Porsche to arrive at its goal of a 20% margin. Becoming more streamlined and replacing key executives may help but these moves are unlikely to shift the direction of travel much in the near term.”

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