'Black Friday' sales bonanza no boost for London stock market

'Black Friday' sales bonanza no boost for London stock market

LSE London Stock Exchange
Logo of the London Stock Exchange.

LONDON: London's stock market dipped on Friday (Nov 24), bucking an upwards trend elsewhere, as 'Black Friday' price-slashing wooed customers but was expected to hurt the bottom line of Britain's biggest retailers.

So-called Black Friday, the now-traditional day of steep discounts in the run-up to Christmas, failed to boost share prices of retailers partly owing to fierce competition from online giants like Amazon, dealers said.

The mood in London soured also on news that British consumer confidence, tracked by pollster YouGov and the Centre for Economics and Business Research, has slumped to the lowest level since just after last year's shock Brexit referendum.

"With sales rising at the expense of margins, there is a strong possibility that we will see retailers' profitability suffer despite rising revenues," Joshua Mahony, analyst at IG trading group, said regarding the impact of Black Friday.

"Unfortunately, while billions will be spent in the UK today, we have seen UK consumer confidence hit the lowest level since the EU referendum, paving the way for what could be a disappointing holiday season for retailers," he added.

London's FTSE index ended the day down 0.1 per cent.

Shares in clothing retailer Next dropped 1.8 per cent while those in Britain's biggest retailer, supermarket giant Tesco shed 0.8 per cent.

Industry forecasts suggest UK shoppers will spend some £7.8 billion (US$10.3 billion) over the four-day period from Black Friday to so-called Cyber Monday - when online retailers deliver even more steep discounts.

"Black Friday (data) will be analysed next week for evidence the consumer is alive and well," David Hussey, equities analyst at Manulife Asset Management, told AFP.

In the eurozone meanwhile, the Frankfurt and Paris stock markets gained ground, taking their cue from an Asian recovery.

Traders there had no leads from Wall Street, which was shut on Thursday for the Thanksgiving public holiday.

The Dow gained 0.1 per cent in late morning trading on Friday in a short session, but many US investors were expected to remain absent until after the weekend.

"The S&P 500 and NASDAQ 100 has registered fresh record highs as Macy's, Kohl's and Amazon are in high demand as the Black Friday fever sets in. The major shopping day in the US has given a boost to the retail sector," said market analyst David Madden at CMC Markets UK.

Shares in online shopping giant Amazon and retailer Kohl's climbed nearly 2.0 per cent, while upscale department store Macy's shot up 3.6 per cent.

Key figures around 1630 GMT:

London - FTSE 100: DOWN 0.1 per cent at 7,409.64 points (close)
Frankfurt - DAX 30: UP 0.4 per cent at 13,059.84 (close)
Paris - CAC 40: UP 0.2 per cent at 5,390.46 (close)
EURO STOXX 50: UP 0.3 per cent at 3,582.30
New York - DOW: UP 0.3 per cent at 23,588.96

Tokyo - Nikkei 225: UP 0.1 per cent at 22,550.85 (close)
Hong Kong - Hang Seng: UP 0.5 per cent at 29,866.32 (close)
Shanghai - Composite: UP 0.1 per cent at 3,353.82 (close)

Euro/dollar: UP at US$1.1940 from US$1.1851 at 2200 GMT
Pound/dollar: UP at US$1.3349 from US$1.3309
Dollar/yen: UP at 111.56 yen from 111.22 yen

Oil - Brent North Sea: DOWN five cents at US$63.50 per barrel
Oil - West Texas Intermediate: UP 76 cents at US$58.78 per barrel

Source: AFP/de