Must read: UK and Europe track Wall Street higher, Kingfisher

GLOBAL MARKETS

The FTSE 100 has opened higher with Kingfisher (LSE:KGF) leading the charge thanks to a positive Q3 trading statement. Beazley (LSE:BEZ) has plunged to the bottom of the FTSE 100 after a disappointing Q3 update and a target price cut from JP Morgan.

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UK banks like NatWest Group (LSE:NWG), Barclays (LSE:BARC) and Lloyds Banking Group (LSE:LLOY) are all trading towards the top of the index on reports the sector will be spared from tomorrow’s Autumn Budget tax raid. AO World (LSE:AO.) is another big mover in the UK, gaining around 8% thanks to a profit upgrade.

Speculation will finally be put to bed tomorrow when the chancellor outlines her plans for tax increases and spending changes. The FT reports that CME Group data suggests traders are taking on bearish bets against the pound via put options in anticipation that sterling will fall tomorrow as Rachel Reeves’ announcements weigh on the UK’s economic outlook.

In Asia, the Nikkei is playing catch up after Monday’s holiday while Chinese stocks are outperforming after leaders Trump and Xi held their first talks since the tariff truce.

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In geopolitics, the US and Ukraine have drafted a new 19-point peace plan, reduced from a previous 28-point proposal.

US markets are in an upbeat mood thanks to growing expectations of a December rate cut stateside after Federal Reserve Governor Chris Waller suggested he is in favour of a reduction next month. Today, markets await the release of delayed post-shutdown September data on US retail sales and PPI inflation. US futures are pointing to a flat open after a strong Monday on Wall Street with the tech-heavy Nasdaq surging 2.7% and Mag7 outperforming.

KINGFISHER

Kingfisher has raised its full-year profit outlook – it now expects adjust profit before tax for the year ending January 2026 to be between £540 million and £570 million, up from the upper end of £480 million to £540 million. That’s up from £528 million in the previous year.

Meanwhile, it reported third-quarter like-for-like sales +0.9% with 3% growth in its biggest market, the UK and Ireland, and 9.8% growth in Iberia, offset by weakness in France and Poland where sales declined by 2.5% and 1.3% respectively. Kingfisher said it is on track to complete its £300 million share buyback programme by March having purchased £75 million so far, highlighting a commitment to shareholder returns.

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Kingfisher enjoyed a strong performance in core and big ticket items while B&Q, Screwfix, and Ibera outperformed. Long-suffering Castorama and Brico Depot were weaker spots in France with falling sales at both brands.

Investors are cheering Kingfisher’s profit upgrade, after it already raised its profit outlook in September, helping to maintain the bullish momentum shares have been enjoyed so far this year.

However, the retailer is not without challenges including cost pressures and wage inflation in the UK and France as well as consumer sentiment uncertainty and labour market weakness ahead of tomorrow’s Budget. Although shares have had a strong year, the stock is still a way off the highs seen in 2021 during the pandemic stay-at-home DIY boom.