FTSE 100 Shakes Off Hospitality Woes to Post Weekly Gain
London's blue-chip index demonstrated resilience on Friday, closing the week firmly in positive territory despite a dramatic sell-off for Premier Inn owner Whitbread. The FTSE 100 index closed up 26.58 points, or 0.3%, at 9,720.51, capping a strong weekly performance. For the week, the premier index was up a robust 1.9%.
The FTSE 250, a gauge for UK-focused companies, also advanced, gaining 52.44 points, or 0.2%, to close at 22,143.91. The AIM All-Share index performed even better, ending 5.09 points higher, a rise of 0.7%, at 754.08. Over the week, these indices climbed an impressive 3.8% and 2.6% respectively.
Chaotic Start and a Hospitality Giant's Slump
The trading session began with unexpected global turbulence. A significant technical outage halted trading on the Chicago Mercantile Exchange (CME), one of the world's major trading operators. The CME cited a cooling issue at its data centres for the halt, which impacted trade across key commodities, treasuries, and index futures, including freezing pricing on the US benchmark crude contract, WTI, for several hours.
Back in London, the spotlight fell on Whitbread, which saw its shares plummet by a staggering 11%. The dramatic fall came after the company warned that changes to business rates announced in Wednesday's Budget will materially increase costs in the next financial year. The Dunstable-based firm, which owns the Premier Inn chain, now expects the changes, driven by higher rateable values for many hotels, to result in a £40-50 million hit in the year to February 2027.
Whitbread's Chief Executive Officer, Dominic Paul, stated the company was "extremely disappointed" by the Budget outcome, warning it would have "a significant impact on our business and the wider hospitality industry." The negative sentiment was compounded by analysts at Bernstein, who double-downgraded Whitbread's stock to "underperform" from "outperform" and slashed their share price target.
Winners, Losers, and Global Market Pulse
While Whitbread struggled, other stocks enjoyed a better day. Budget airline easyJet rose 3.0% after hosting a seminar around its holidays business. Analysts at Citi noted the company's ambitious target for the division, though they maintained a "neutral" rating for now.
On the FTSE 250, it was a day of celebration for pub and restaurant operator Mitchells & Butler. Its shares shot up 13% after it reported a 20% jump in pre-tax profit to £238 million for the last financial year, driven by strong like-for-like sales growth.
In other market movements:
- Weir Group shares rose 0.9% after a positive analyst initiation.
- IMI shares climbed 1.6% on similar news.
- Luxury brand Burberry fell 2.9% after a downgrade from JPMorgan.
- Betting firm Evoke plunged a further 9.6% following gambling duty changes in the Budget.
The positive sentiment extended across the Atlantic. In a shortened trading session in New York, the Dow Jones Industrial Average was up 0.5%, while the S&P 500 and Nasdaq Composite both traded 0.3% higher. In Europe, the CAC 40 in Paris and the DAX 40 in Frankfurt both closed up 0.3%.
Looking ahead, market participants are eyeing a slew of manufacturing PMI readings due on Monday, alongside UK mortgage approvals and a scheduled speech from Federal Reserve Chair Jerome Powell.
