“Blue-chips and the FTSE250 were both down in early trading following a mixed bag of results from retailers although high street stalwarts Debenhams, Marks & Spencer and John Lewis all benefited from the Christmas spending spree,” says AJ Bell Investment Director Russ Mould.
“Marks & Spencer topped the blue-chip board in early trading after better-than-expected results from its clothing and homeware business which has halted years of decline. Better ranges, better availability and better prices all contributed to an improved performance and M&S also continued to substantially reduce discounting, including over Black Friday. M&S’s shares were up by more than 5.3%.
“Beauty and gift sales underpinned a strong Christmas performance at Debenhams where the non-clothing sales mix rose to 57%. Debenhams has maintained market share in a competitive clothing market while continuing to reduce the number of clothing options as well as the level of discounts. The group continues to see strong growth in online sales which are up by over 25% in two years. Debenhams was up by over 3.5% in early trading.
“John Lewis Partnership continues to gain market share but warned that its trading profit is under pressure. Department store John Lewis and its supermarket Waitrose both saw sales rise by nearly 5% over Christmas and it expect to report profits up on last year. But trading profit is under pressure due to changes taking place across the retail sector which are set to quicken, especially in the next 12 months as the effects of weaker sterling feed through.”
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