Marks & Spencer, Dixons Carphone and Serco

“The rally for the FTSE 100 continued following a sharp overnight rise on Wall Street, due to a surge in new home sales. Asian markets were equally positive this morning, while oil prices continue to push higher,” says AJ Bell Investment Director Russ Mould.

“The promise of ‘jam tomorrow’ is rarely appealing to investors especially if it is accompanied by some short-term pain and Marks & Spencer found itself at the bottom of the blue-chip index after new chief executive Steve Rowe warned that actions to improve the clothing and home range would hit profits.

“The group’s food arm continues to outperform in a competitive market and masks unsatisfactory results from the clothing and home business.

“The merging of Dixons and Carphone Warehouse in 2014 has turned out to be a marriage made in heaven with the electronics giant expecting pre-tax profits to be in the top half of previous guidance. Dixons Carphone’s like-for-like revenues are up 5% and the group is gaining market share in the UK & Ireland, Nordics and Greece.

“Outsourcing firm Serco led the FTSE250 index on forecasts that full-year profits would be ahead of market expectations. Several contracts which were due to end early in the year have run-on longer than anticipated and others have been more profitable.”

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