Burberry shares fell to a four=year low after it was hit by sweeping downgrades following last week’s profit warning.
The British fashion brand plunged as much as 15pc on Friday before ending the day down 5pc after it said trading has been affected by ‘slowing luxury demand’.
Burberry cut its profit outlook by £100m after sales fell 7pc to £706m in the 13 weeks to December 30 as customers held back from splashing out on its expensive handbags.
Burberry shares were downgraded across the City, with outlook cuts from the likes of Goldman Sachs, UBS and Stifel
The mood hardly improved yesterday with downgrades across the City, including from Goldman Sachs, UBS and Stifel.
Goldman said that the extent of Burberry’s reduced profit forecast was more alarming than its ‘disappointing’ sales performance.
‘The reduction in profitability from prior expectations suggests greater investment is required to deliver the sales turnaround,’ analysts added.
Shares dropped 5.7pc, or 73.5p, to 1212p, the lowest level since early 2020. They have more than halved in value since peaking in April last year.
It was a subdued start to the week for the London stock market as the FTSE100 fell 0.39pc, or 30.02 points, to 7594.91 and the FTSE250 rose 0.02pc, or 3.22 points, to 19,200.84.
Investors should ‘steer clear’ of food delivery firms, one City broker has warned.
BNP Paribas Exane told its clients it struggled to remain optimistic about a sector in which Hello Fresh – ‘the only one making money’ – is also ‘warning on profit’. The bank’s analysts said Ocado is their least favourite stock in the industry given the pace at which the online grocer is burning through cash, sending shares down 5.1pc, or 33.2p, to 619p.
Asset manager Ashmore said the improving health of the global economy and the US Federal Reserve’s intention to stop raising interest rates meant fewer clients are pulling out funds.
The group, which invests in emerging markets such as Colombia, Indonesia and Saudi Arabia, said its net outflows fell from £2.27bn in the first quarter to £1.25bn in the second.
But this was still slightly higher than the £1.17bn analysts had forecast for the three months to the end of December. Shares fell 0.5pc, or 1.2p, to 222.6p.
DP Eurasia has been given more time to decide whether it wants to accept or reject the £139m takeover offer from its largest shareholder.
Jubilant Foodworks, an Indian food service company which owns more than half of the Londonlisted firm, extended the deadline from this Thursday to the last day of January.
At the end of last month, DP Eurasia snubbed the 95p-a-share offer but told its largest shareholder a potential price it could consider. Shares slid 2.6pc, or 2.5p, to 95.5p.
There was good news for digital health company Kanabo after it signed a partnership with City Dock Pharmacy to launch a walkin pain clinic to offer products such as medicinal cannabis. Shares rose 2pc, or 0.05p, to 2.5p.
Downgrades from the City sent banking stocks into the red. HSBC fell 2.3pc, or 13.7p, to 596.4p after
BNP Paribas Exane flagged concerns over the impact of lower interest rates.
And Lloyds slid 2.6pc, or 1.16p, to 43.83p after the Bank of America warned the business could take a hit from its exposure to the car financing industry.
Jadestone Energy tumbled 17.9pc, or 6.6p, to 30.2p after it warned that it will need to spend more than it expected to on repairing and maintaining two of its assets in Australia. The oil and gas group added that this may result in a ‘non-cash impairment’ in its results for 2023.
