By Patrick Munnelly, Market Strategist, Tickmill
On Wednesday, UK shares faced a decline of 0.8%, primarily due to a sell-off in mining stocks, driven by falling prices of most metals.
Tesco raises profit guidance
Tesco LON:TSCO, the largest retailer in the UK, saw its shares rise by 4.3% by the close, making it the second biggest percentage gainer on the FTSE 100.
This increase in share price followed Tesco’s announcement that it had raised its profit guidance for the year.
The company reported a better-than-expected 13.5% increase in first-half core profit and indicated that food inflation was expected to continue falling. Tesco now anticipates its full-year retail adjusted operating profit to be in the range of £2.6 billion to £2.7 billion, compared to its previous forecast of about £2.5 billion.
The positive results and outlook from Tesco contributed to its stock performing well, with a year-to-date increase of approximately 14%. Tesco’s CEO, Ken Murphy, also expressed optimism about British shoppers’ readiness for the upcoming Christmas season. Tesco were pipped to the top spot on the index by International Consolidated Airlines LON:IAG whose shares saw an increase of 4.45% on the session.
Whitbread to expand presence in Ireland
On the negative side of the ledger sits Whitbread LON:WTB, shedding 3.78% by the end of the session. The losses came after the parent company of Premier Inn expanded its presence in Ireland with the acquisition of a development site in Usher’s Quay, Dublin 8.
The site has received planning permission for a 100-key hotel.
Whitbread acquired the property from Warren Private and Greenleaf, although the financial details of the transaction were not disclosed.
This acquisition adds to Premier Inn’s Irish portfolio, which includes both operational hotels and those in the development pipeline, totaling more than 1,500 rooms.
Whitbread plans to construct the hotel, pending potential changes to the current planning consent. The company currently operates two Premier Inn hotels in Dublin City and has plans to open two more hotels in Dublin and Cork within the next six months.
This acquisition strengthens Whitbread’s relationship with Warren Private and Greenleaf, who are involved in other Premier Inn projects in Ireland.
