- FTSE 100 flat as Tesco and M&S deliver Christmas cheer
- Greggs’ record revenue soured by a tough fourth quarter
- US markets struggle to find momentum as eBay partners with Meta
- Oil steadies a touch over $76 per barrel
Matt Britzman, senior equity analyst, Hargreaves Lansdown:
“The FTSE 100 stands out among European markets this morning, opening broadly flat while its peers fall amid concerns that US interest rate cuts may be scarce in 2025. UK markets are benefiting from strong results from Tesco and M&S, both pointing to booming food sales. Tesco, in particular, celebrated its “biggest ever Christmas,” earning a spot on Santa’s good list. But the year ahead won’t be all smooth sailing for the retail giants, as the sector gears up to battle imminent tax hikes.
It’s not all sausage rolls and smiles for Greggs, despite delivered a record $2 billion in sales over 2024. The bakery giant flagged lower consumer confidence as a key challenge in the final quarter, with disappointing 2.5% like-for-like sales growth – less than half of what many had expected. While consumers have more dough in their pockets, their appetite for spending remains subdued, and it’s starting to show in the numbers. On the positive side, Greggs has limited influence over consumer sentiment but continues to perform well in a tougher environment, with its value-focused offering helping to maintain market share. Looking ahead, Greggs has plenty of growth drivers like menu expansion and new store openings, though managing the significant cost pressures from the Budget will be a critical challenge in 2025.
US stocks edged higher yesterday evening, but the lack of momentum suggests a sustained rally isn’t imminent. The broader bullish trend for 2025 remains intact, yet elevated volatility, muted trading volumes, and the likelihood of limited rate cuts this year continue to cast a shadow over market sentiment. A key highlight came from eBay, which soared as the S&P 500’s top gainer after announcing a partnership with Facebook Marketplace. The deal, starting this week in the US, Germany, and France, will feature select eBay listings on Facebook’s platform, addressing a major concern about eBay losing business to Facebook’s 1.2bn monthly Marketplace users.
Brent crude oil is hovering above $76 per barrel in early trading, recovering from earlier losses as traders balanced rising US fuel inventories against tightening global supplies. US crude stockpiles fell for a seventh straight week, down nearly 1 million barrels, but surging gasoline and distillate inventories raised questions about demand. Globally, OPEC output slipped in December due to UAE maintenance, while Russia’s production missed targets, adding to the market’s supply-side worries.”
