Three important things you need to know from across the markets this morning from investment writer, Tony Cross.
Hays
Recruiter Hays attracted the wrath of the market this morning in response to a quarterly trading update. At 10am, the stock was the worst main market performer, down 11% as management cautioned that H1 pre-exceptional operating profits would likely be £60m, materially below the current market forecast of £73m. The company is battling against a global slow down in recruitment as the decision making process is extended. Presumably the start of rate cuts and hopefully avoiding recessions will pave the way for a brighter outlook here but there’s clear concern that the slowdown seen in December can’t just be attributed to seasonality.
JD Sports
That trading update from last week continues to blight JD Sports with the stock having shed a further 2.6% in early trade. With losses since last Thursday morning now in excess of 25% the absence of any meaningful bargain hunting perhaps projects a gloomy picture when it comes to the short term outlook for consumer discretionary spending. Have we now passed “peak trainer”?
MJ Gleeson
Housebuilders could be in for a rough ride this year as investors bet on falling interest rates whilst the sector also has to account for a potential change in government – and accompanying housing policies. Numbers from low cost builder MJ Gleeson this morning painted a less than impressive picture with heavy investment in housing starts last summer seeing debt build. Reservation rates may be on the up but management have added new variables into the equation. If the tail winds aren’t supportive, this could be a challenging year. Shares are already down 9%.
