Wednesday’s Master Investor Market Report

– The FTSE 100 closed the day flat at 6,753.75.
– The FTSE 250 fell by 5.32 points to 17,637.08.
– The FTSE All Share decreased by 0.05 points to 3,676.46.
– The FTSE AIM All Share finished 1.08 points higher at 756.22.

UK unemployment rose for the first time in two years over the three months to May, with the number of people out of work climbing by 15,000 over the period. This translates to an unemployment rate of 5.6%. There was positive news though as average pay continues to pick up pace and rose at an annualised rate of 3.2% during the three months. David Kern from the British Chamber of Commerce commented, “this setback is a reminder that our recovery is still fragile and that further measures are needed to nurture economic growth, in particular by encouraging businesses to invest and export”.

Fashion house Burberry (BRBY) continues to struggle in the Asia Pacific region, but this is being outweighed by strong sales growth in other areas. Total retail sales grew by 8% to £407 million during the three months ended 30th June, but this is traditionally the weakest quarter for the company’s retail operations. Licensing income is expected to fall by around 40% over the full year. Burberry shares dropped 42p to 1,581p.

Shares in pub operator Wetherspoons (JDW) fell by 65p to 706p after the firm announced that profits before tax for the year ending 26th July would be lower than in the prior period. Sales have risen by over 7% and the company reported 20 net new pub openings. Management also expressed concerns that the recently announced living wage changes would have a significant impact on Wetherspoons’ ability to compete with supermarkets.

Halfords (HFD) is on track to meet full year targets after children’s car seats and premium bikes helped to push sales for the quarter ended 3rd July 3.6% higher than in the equivalent period of 2014. Adjusted for the timing of Easter, like-for-like sales are estimated to have grown by 4.2%. N+1 Singer backed the company following the news, saying that “Halfords is one of few sector stocks not looking overly rich on valuation”. Halfords sank 9p to 541p regardless.

Oil outfit Afren (AFR) has had its shares suspended today after oil production plummeted. The company is carrying out a full business review. Westhouse Securities issued a “sell” rating on the stock and commented that “it is possibly just a matter of time before the bondholders end up owning the entire company, under the terms of the proposed restructuring”.

AGA Rangemaster (AGA) has confirmed that it has agreed to a takeover from US kitchen equipment manufacturer Middleby. Under the terms of the deal Shareholders will receive 185p per share, which values the company at £129 million and represents a significant premium over yesterday’s closing price of 150p. The two companies believe that both will benefit from better access to each other’s core markets. AGA shares climbed 30.25p to 182.25p.

Tomorrow’s news today

Dixons Carphone (DC.) and Sports Direct (SPD) are among the firms publishing news tomorrow.

Quote of the day

“Success is simply a matter of luck. Ask any failure.”
– Earl Wilson