Burberry helps drag FTSE into the red
|Sharp downside for the likes of Burberry, Pearson, and Informa have dragged the FTSE lower despite GBP weakness.
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FTSE falls amid after trading updates
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Impending Chinese data brings miners back in focus
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Burberry sales figures highlights risks of latest strategy
The FTSE 100 is trading in the red yet again, as a trio of heavy losses from Burberry, Pearson, and Informa have provided a drag on the index despite a respite in the GBPUSD strength story. Despite record highs across the Dow, S&P 500, Nasdaq, and Hang Seng this week, we are seeing such gains difficult to come by for the FTSE 100, which has drifted lower. Yesterday’s deterioration in the mining sector, in association with raised fears over the Chinese economy have the potential to rear their head once again tomorrow, after a whole raft of economic data points are released overnight.
Burberry shares have tumbled 7% in early trade, after sales disappointed both home and abroad. The decision from Chinese and UK consumers to shift their custom towards more cost effective alternatives serves to undermine Burberry’s latest plan to restrict supply and raise prices in a bid to increase margins. For many, today’s figures highlight the difficulty the firm will have with their latest strategy, with the risk of significant further downside in the share price should they fail to attract enough customers at higher prices.
Ahead of the open we expect the Dow Jones to open 163 points higher, at 25,956.
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