Retail in focus as Debs chief exits

The spotlight fell on retailers on the first day of new year trading after troubled Debenhams announced the resignation of its finance boss.

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Debenhams remains under pressure as finance chief resigns.

The spotlight fell on retailers on the first day of new year trading after troubled Debenhams announced the resignation of its finance boss.

Shares in the department store chain - which issued a shock profits warning earlier in the week - picked up 3% on the announcement that chief financial officer Simon Herrick was to leave.

Rivals also saw gains after sparkling festive performances were reported by House of Fraser and John Lewis, though the wider performance of equities was gloomy, with the FTSE 100 Index down 31.2 points to 6717.9, or nearly 0.5%.

After recording its best year since 2009 earlier this week, the top tier was hit by worries over China after survey data pointed to slowing factory activity, leading to falls among mining stocks.

But there were better figures from UK manufacturers after the closely watched Markit/CIPS purchasing managers' index (PMI) revealed the sector's best quarter for more than two-and-a-half-years - despite the reading dropping slightly on a month-on-month basis in December.

Stock market falls were seen in Europe as investors took profits after an end-of-year rally. France's Cac 40 and Germany's Dax were each down by more than 1%, while on Wall Street the Dow Jones Industrial Average was in the red too.

On currency markets, sterling fell by a cent to 1.64 US dollars after well-received data from America's manufacturing sector strengthened the greenback. The pound was flat against the single currency at 1.20 euros.

FTSE 250-listed Debenhams saw shares recover ground after Tuesday's 12% plunge in spite of more woes after Mr Herrick quit in a torrid week for the group.

It warned on Tuesday that half-year profits were expected to fall by more than a quarter after missing out on an expected sales surge in the week before Christmas, blaming tough high street conditions and bad weather.

Analysts at Numis Securities cautioned the trading problems at Debenhams were "more company-specific than market-led", but shares climbed 2.2 to 75.2p.

There were also gains for FTSE 100 competitors that had fallen earlier this week after the Debenhams alert thanks to buoyant trading updates from John Lewis and House of Fraser.

John Lewis said like-for-like sales climbed 6.9% over the five weeks to December 28, while House of Fraser hailed its best ever Christmas with comparable sales up 7.3%.

Next lifted 80p to 5530p ahead of its update tomorrow and Primark parent Associated British Foods added 43p to 2488p.

B&Q owner Kingfisher lifted 1.5p to 386.2p but the shine failed to rub off on Marks & Spencer, down 5.3p at 427.3p.

A number of miners fell amid fears over demand from China's manufacturing industry, with Anglo American the worst hit in the sector, down 28p to 1292p. Rio Tinto fell 39.5p to 3370p.

The biggest FTSE 100 risers were Randgold Resources, up 144p to 3934p, Hargreaves Lansdown up 51p to 1405p, Ashtead Group up 23.5p to 783.5p and Associated British Foods up 43p to 2488p.

The biggest FTSE 100 fallers were Sage Group, down 9.6p to 394.1p, Rexam down 12.5p to 518p, Hammerson down 11.6p to 490.4p and SSE down 31p to 1339p.