Daily market update: JD Sports, Nike, ASOS, Wetherspoons

“The FTSE 100 fell after more selling on Wall Street overnight and weakness in Asia as the Bank of China kept rates unchanged. This put pressure on the mining space given heavy Chinese consumption of commodities,” says AJ Bell investment director Russ Mould.

“Among the fallers was JD Sports Fashion as the retailer reacted to weak results from Nike overnight. The US sportswear giant warned the current quarter could see the company absorb a lot of pain as it looks to turn around its fortunes under new CEO Elliott Hill amid signs of slowing demand among American consumers. This overshadowed a better-than-feared showing in the three months to the end of February.

“Airline stocks came under pressure after an unprecedented total shutdown of Heathrow airport following a fire at a nearby electricity substation – the development will have stirred uncomfortable memories for the industry of the disruption it endured during the pandemic.”

ASOS

“After a dreadful start to 2025 for the share price, ASOS was primed for a relief rally if it could offer any sort of positive news with its latest trading update.

“Fortunately for shareholders it has delivered on this front. While volumes remain under some pressure, the big focus for the business has been on improving profitability and here there has been tangible progress, with inventory reduced and an increase in full-priced sales helping to push earnings ahead of forecasts.

“The company has found post-pandemic life extremely difficult. During lockdown it enjoyed a boom. Bricks and mortar rivals were not available, people had money to spend and not a lot else to spend it on and few shoppers bothered to return items given the added hassle.

“The inflationary pressures which followed Covid put many of these supportive trends into reverse. People were suddenly watching their spending, returns ramped up, bringing added cost and complexity for ASOS, and appetite for fast fashion started to wane.

“As well as reducing inventory and shifting away from heavy discounting, ASOS has also been trying initiatives like its ‘Test & React’ model where businesses can produce small batches to sell on the platform and react based on the resulting levels of demand – helping to avoid situations where there is lots of unsold inventory sitting in warehouses.

“Today’s numbers represent an important first step on a long road to recovery, but the market will want to see some evidence eventually that metrics like active customers and orders are picking up when the company reports its first-half numbers in April to have real confidence in an ASOS turnaround.”

JD Wetherspoon

“There is no getting away from the fact that JD Wetherspoon has missed the mark with its first-half results and this will fuel investor concern about the increased costs it is facing.

“Because the pub chain’s appeal is based on value for money it arguably has less capacity to pass on rising costs without alienating its customer base.

“People want to know they can go to a Wetherspoons and get a cheap pint or hot drink and a reasonably priced meal and it cannot afford to undermine this offering.

“Therefore, while revenue growth was solid, profits were lower as margins were pressured by increased labour, utility and, to a lesser extent, labour costs.

“The company does have scale on its side in terms of managing some of the cost pressures it faces, however as a big employer of staff on modest wages, the changes in last year’s Budget have had a big impact.

“There were some positive underlying trends. Revenue per pub continues to go up as the estate evolves and like-for-like sales have been and continue to be strong.”

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