Ryanair to exit London stock market and Kingfisher is still riding the DIY boom

“A rather slow day for news is enlivened somewhat by the not entirely unexpected revelation that Ryanair is to fly off into the sunset and leave the London stock market behind,” says AJ Bell Investment Director Russ Mould.

“For a business with a razor sharp focus on costs it seems the expense of maintaining a UK listing just doesn’t stack up any more given a decline in trading volumes and so Ryanair is planning a pre-Christmas getaway.

“If Shell’s decision to pivot to London was chalked up as a Brexit win, this is likely to be characterised as a Brexit loss in some quarters, coming after restrictions were introduced on UK investors buying its shares at the start of the year.

“Ryanair is desperate to be majority EU-owned in order to retain full licensing and flight rights in the bloc following the UK’s exit from the EU.

“Miners helped power the FTSE 100 to modest gains on Friday morning and there was some modestly encouraging news on UK retail sales and consumer confidence.

“The data suggests a rising cost of living hasn’t (as yet) overly depressed spending on material goods. Though the October retail sales figure is likely to have been boosted by early Christmas shopping as people look to avoid being caught out by shortages.

“Amid generally weak trading in Asia, not helped by soggy figures from Chinese e-commerce giant Alibaba, Japanese stocks made gains as incoming Prime Minister Fumio Kishida announced a massive £363 billion stimulus package.”

Kingfisher

“Lockdown winners were always going to face tough year-on-year comparatives in 2021 and no more so than Kingfisher. The DIY boom that kicked off in 2020 has had considerable legs and still shows positive momentum. Unfortunately, it’s very hard to grow by a very large amount two years in a row, and so Kingfisher is now lamenting a drop in third quarter like-for-like sales.

“Most companies are comparing their latest takings to those of two years earlier, to see progress from a pre-Covid world to now. On that basis, Kingfisher is still doing very well. Furthermore, the company’s fourth quarter has got off to a bang and it is guiding for full year profit to be at the higher end of previously guide ranges.

“Supply chain and inflation issues don’t appear to be having any catastrophic impact on the business. Kingfisher says its product pricing remains competitive, and logistics and product availability seem to be under control. So, all things considered, demand remains good and it’s coping with industry-wide pressures, which must be a win in anyone’s books.”

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