Markets subdued despite US rate cut optimism, Dyson to slash workforce, Mulberry appoints new CEO, Aston Martin tops FTSE 250 after poaching Ferrari director, Hipgnosis investors accept Blackstone offer and Thames Water running out of time

“Whilst Fed chair Jerome Powell’s comments that the US economy is no longer overheated will be welcome news for investors who are more than ready to hear the starting gun on rate cuts, that fizzy expectation couldn’t lift UK markets today,” says Danni Hewson, Head of Financial Analysis at AJ Bell.

“News that British appliance manufacturer Dyson is to pare back its UK workforce by a quarter is a significant blow not just to those losing their jobs but also Labour’s push to get the economy growing.

“The company has made it clear the plans were a long time in the making but there have been questions about the future of the business in the UK since 2019 when it shifted its headquarters to Singapore. Though its research and development facility will remain, the decision is an uncomfortable one and begs the question why Sir James Dyson and his company believe the future must be found elsewhere.”

Retail / Mulberry

“Inflation might be back at ‘normal’ levels, but the British public is still feeling the squeeze and looking for any excuse to avoid making unnecessary purchases.

“After April’s downpours, June’s failure to turn up the thermostat has meant spending remains suppressed, especially in gardens and other outdoor spaces which people haven’t been able to make use of. It’s no surprise that stocks like Frasers, Next, B&M, Associated British Foods and Marks & Spencer have slid into the doldrums today.

“Luxury goods maker Burberry didn’t escape the rout, though its share price fall coincided with news that rival Mulberry has ditched its CEO with immediate effect. It’s already appointed a new man to steer the ship into less choppy waters, citing Andrea Baldo’s experience with improving brand identity, sales and profitability.

“Retail, particularly in the luxury goods sector, is a cut-throat business and a bit like last season’s trends – once you’re out of fashion you’re just out.

“The last year has been a bruising one for all retailers, luxury or otherwise. The trick is making sure you are the first place your customer visits once they find they have a bit more cash to splash.”

Aston Martin

“It’s unusual to find Aston Martin at the top of the FTSE 250 leaderboard but shares in the beleaguered classic car maker moved forward by a decent 4% today in what was otherwise a rather uninspiring day for UK markets.

“Investors may have been heartened by the potential that comes with the poaching of Ferrari’s Enrico Cardile to take over the position of Chief Technology Officer for their F1 team. The rumour mill had been grinding for several weeks and the appointment is a coup for Lawrence Stroll in his bid to build up the brand and the company’s commercial profitability.

“Success on the track delivers the kind of advertising boost you can’t purchase via normal channels. It gives the brand a desirability and a relevance to auto lovers with very deep pockets. And technological advances to those F1 uber-cars can be harnessed and developed for vehicles manufactured for the more mundane streets inhabited by ordinary motorists.

“It’s been a pretty dismal year for the company’s share price which is down more than 50%, but today’s news is a small silver lining investors will be hoping gives way to bluer skies.”

Hipgnosis Songs Funds

“Hipgnosis shareholders have clearly decided it’s time to draw a line under the turbulent past couple of years. They voted overwhelmingly to grab the bird in hand and agree to Blackstone’s takeover of the songs fund.

“The saga has all the makings of a sad country ballad as what was once perceived as a dazzling opportunity became bogged down in disagreements and ultimately disappointment.”

Thames Water

“Time is running out for Thames Water unless it can persuade the regulator to turn on the taps and allow it to charge customers more for a service they already feel isn’t value for money. There are huge questions to answer about how this critical infrastructure has been managed since privatisation and why so much money could have been plundered by previous investors.

“It’s interesting to note that Severn Trent was one of the biggest gainers on London markets today with investors perhaps sensing that Ofwat may be persuaded to soften its stance in order to protect the underlying service.

“How to manage what is undeniably a PR nightmare will be one of the first big tests of the new Labour government which won’t want to be seen as lumping the taxpayer with the problem or the bill.”

These articles are for information purposes only and are not a personal recommendation or advice.