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Next Defies High Street Blues As Markets Recover Lost Ground ? Latest Market Analysis

Hopes that German and French leaders Angela Merkel and Nicolas Sarkozy, lovingly now known as “Merkozy”, would have some success in persuading Greek Prime Minister George Papandreou in to reversing his referendum plan eventually helped equity markets recover some of the previous day’s declines.

Early gains though were soon eroded, traders calling the rises as a squeeze on short sellers and a ‘dead cat bounce’, and by mid morning the main European indices were trading lower. Fortunately this was short lived and stocks gradually gained throughout the session, the FTSE 100 closing 65.5 points higher at 5484, with major European and US indices performing in a similar manner. This was despite the FTSE 100 technically ‘losing’ almost 13 points worth of value as bumper dividend payers Glaxo Smithkline, BP and Royal Dutch Shell all going ‘ex-dividend’.

With most main markets patiently waiting for developments in Europe it became specific stocks that attracted attention. Aside from the obligatory violent moves from the mining, energy and banking sectors, it was shares in Next that stood out most following a resilient 3rdquarter trading update to the market. Despite the much reported difficulties retailers were facing on the high street, the group reported an increase in sales, driven mainly by growth at its online and directory divisions. Investors reacted positively to the update driving the shares 6.5% higher, by 166p to a record high of 2723p.

Elsewhere industrial metals also traded higher, as did Oil, reflecting the slightly more confident outlook (one could argue the less pessimistic outlook), whilst Gold traded 1.5% higher and Silver surged by over 4%.

This was posted in Bdaily's Members' News section by John Dance .