FTSE 100 edges up in lacklustre pre-Christmas session

The FTSE 100 closed fractionally up on Friday as investors lacked enthusiasm in UK stocks in the last half-day of trading before Christmas.

A short-lived “Santa rally” boosted London markets on Wednesday, but it fizzled out towards the end of the week and retail stocks were among the biggest fallers on the FTSE 100.

Despite it being typically the busiest shopping day of the year, investors appeared less hopeful about the prospects for retailers this festive season with Royal Mail strikes and cost concerns dampening sales forecasts for many shops.

Budget retailer B&M, retailer Frasers Group and luxury fashion brand Burberry all saw share prices dwindle on Friday.

The FTSE 100 closed 3.73 points higher, or 0.05%, at 7,473.01.

Matt Britzman, an equity analyst at Hargreaves Lansdown, said: “Today was forecast to be the busiest shopping day of the year, according to Sensormatic, but there is a chance the peak shopping period may well have passed in the UK, as consumers heeded warnings to buy early to avoid disappointment due to strikes.

“It’s unlikely bricks and mortar stores will offset the drop in online demand due to Royal Mail walkouts, given strikes by rail workers are also disrupting travel into town and city centres.

“Shoppers are also set to remain cautious given the latest GDP snapshot showed real household incomes falling 0.5% during the third quarter, a trend that is likely to have continued into the final few months of the year.”

But analysts said London’s leading index was in a better position ahead of Christmas than other leading global markets which have suffered heavier losses during the year.

Chris Beauchamp, chief market analyst at online trading platform IG, said: “In such a tough year for stocks, it is an achievement for the FTSE 100 to finish for Christmas more or less flat for the year so far, while others have suffered much more.

“But with the global economy staring a recession in the face there is unlikely to be too much optimism heading into the new year.”

The German Dax edged up 0.27% on Friday, ending the week on a more positive note despite suffering bigger losses during the year as Europe’s largest economy was rocked by war in Ukraine, the energy crisis and higher inflation.

The French Cac closed down 0.14%. In the US, markets had not yet opened.

The pound was strengthening when markets closed, up 0.16% to trade at 1.2059 against the US dollar, and creeping up 0.01% to 1.1357 against the euro.

Brent crude oil was also enjoying an end-of-the-week uplift, moving 2.2% higher to 82.76 US dollars per barrel.

In company news, shares in Boohoo finished for Christmas at its lowest closing price for seven years after analysts at Stifel slashed their guidance for the online retailer.

The brokerage cut its rating on Boohoo to “hold” from “buy”, lowering its price target to 40p from 165p, with analysts struggling to see growth catalysts in the short term.

The fast fashion group saw its shares fall 0.2p to 34.75p at the early close.

Next was a beneficiary of the latest update by Stifel. The high street stalwart edged 8p higher to 5,606p after Stifel recommended investors buy the stock.

Elsewhere, David Beckham-backed cannabinoid business Cellular Goods slumped in value after posting widening losses for the past year.

The company, which is developing skincare products using cannabis-derived chemicals, recorded a £5.99 million pre-tax loss for the year to August 31, growing from a £3.33 million loss last year.

Shares slid by 0.225p to 0.725p on Friday.

The biggest risers on the FTSE 100 were DS Smith, up 5.5p at 324.5p, Pershing Square, up 45p at 2,890p, Centrica, up 1.48p at 96.72p, Prudential, up 17p at 1,116.5p, and Anglo American, up 45.5p at 3,249.5p.

The biggest fallers were Pearson, down 8p at 937.6p, London Stock Exchange Group, down 58p at 7,130p, National Grid, down 8p at 989.6p, B&M, down 3.3p at 408.8p, and BAE Systems, down 6.6p at 855p.