MARKET REPORT: Investors continue to check out of Burberry ahead of key update

Burberry shares fell again yesterday amid uncertainty over its future ahead of a crucial update from the new boss.

The luxury brand’s stock slipped 6 per cent, or 46.6p, to 731.4p, leaving it down almost 50 per cent so far this year despite a rally over the past month on takeover speculation.

Italian ski jacket maker Moncler, which is backed by LVMH, is rumoured to be mulling a bid for the British fashion house.

However, Moncler has insisted this is not the case, sending the rally into reverse.

The takeover talk comes as Burberry’s chief executive Joshua Schulman, who was appointed in July, prepares to update investors on his plans for the company.

Schulman, who is Burberry’s fourth chief executive in ten years and previously held the top job at Coach and Michael Kors, will set out his strategy alongside the publication of half-year results tomorrow. 

The luxury goods sector as a whole has been hit by high interest rates and inflation – which have dented demand – while a slowdown in the Chinese economy has taken a heavy toll.

Concerns that Donald Trump will launch a trade war when he returns to the White House pushed European stock markets lower with the FTSE 100 lost 1.22 per cent, or 99.42 points, to 8025.77 and the FTSE 250 slid 1.43 per cent, or 295.73 points, to 20,427.80.

European stocks have been under pressure as investors weigh the likelihood of tariff increases on exports to the US. 

Stock Watch – 4 imprint

Shares in advertising and marketing company 4 imprint fell as it hailed ‘a strong financial performance’ but warned of ‘difficult market conditions’.

The company, which personalises everyday paraphernalia like pens, mugs, umbrellas and golf balls for businesses that want branded goods, said new customer orders so far this year are down 9 per cent.

But it said it was still on target to make profits of close to £120millio. Shares slipped 8.2 per cent, or 445p, to 4995p.

There are also worries that Trump will appoint China hawk Marco Rubio as Secretary of State, making him the top US diplomat.

London-listed stocks with exposure to China fell, with Prudential down 5.2 per cent, or 33.4p, to 608p while miners were also on the slide on concerns about the Chinese economy.   

Anglo American fell 4.6 per cent, or 106.5p, to 2220p, Glencore slipped 3.1 per cent, or 12.05p, to 376.45p and Antofagasta dropped by 2.1 per cent, or 34p, to 1622.5p.

There was no respite for housebuilder Vistry following its recent admission that profits will be far lower than hoped after it underestimated the cost of developing certain projects.

City analysts have been reassessing the outlook for the company behind Bovis Homes with UBS and Citigroup the latest to cut their target prices for the stock. Shares fell 5.6 per cent, or 42p, to 713.5p.

Shares in FTSE 100 wound-care firm Convatec, which makes everything from dressings for acute burns to catheters, jumped 22.1 per cent or 47.8p, to 264.4p after it raised its forecasts for the year.

Also making strides in the top-flight was blue-chip distribution group DCC after it announced plans to break itself up.

The company is looking to sell its healthcare unit, which delivers medical products, and has launched a review into the future of its technology division. That will leave it to focus on its energy business which distributes fuel.

Shares surged 14.2 per cent, or 704p, to 5670p.

Power generator Drax rose 3.8 per cent, or 24.5p, to 666.5p after it said earnings for the year would be at the top end of City forecasts.

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