LONDON (Alliance News) - UK stocks bounced higher at the open Tuesday after the Chinese central bank injected extra cash into the world's second largest economy to shore up stocks following a heavy sell-off on Monday.
While the FTSE 100 rallied, Next was the worst performer in the blue-chip index, down 3.7%, after it said its sales growth in the year to January 2 was below the bottom end of its prior guidance, and said it expects full-year profit to remain within its previously guided range.
The fashion and homeware retailer said total brand sales rose 3.7% in the year to January 2, with Next Retail up 2.1% and Next Directory up 6.1%. This was below its previously guided range of between 4% and 6% growth for total sales.
In the 60 days from October 26 to December 24, total brand sales grew 0.4%, as a 2% increase in Next Directory offset a 0.5% decline in Next Retail.
Next said its performance in the fourth quarter was "disappointing" due to unusually warm weather in November and December, while Next Directory was hit by poor stock availability from October onwards.
However, Next declared another special dividend.
With Next being the first retailer to release its Christmas sales performance, the share price of other retailers fell on Tuesday due to concerns they faced similar sales issues. Debenhams was down 2.0%, SuperGroup traded down 1.4% and Marks & Spencer down 0.5%.
The FTSE 100 index traded up 0.9% at 6,150.88 points, the FTSE 250 was up 0.6% at 17,218.58 and the AIM All-Share up 0.1% at 736.34.
In Europe, the CAC 40 in Paris was up 1.0% and the DAX 30 in Frankfurt up 0.9%.
Asian stocks ended in the red but were much more stable than on Monday. The Shanghai Composite closed down 0.2% after a 6.9% fall on Monday which triggered the circuit breaker rule on its first day of introduction. The Hang Seng closed down 0.7% and the Nikkei 225 index down 0.4%.
The modest losses came after China's central bank injected CNY130 billion into the money market on Tuesday, in a bid to support the stock market which crashed a day earlier.
The People's Bank of China pumped CNY130 billion in its seven-day reverse repurchase operation, the biggest such injection since September.
Miners, which were the worst performers in the FTSE 100 on Monday after the Chinese stock market plunge, were amongst the best performers early Tuesday. Anglo American was up 3.4%, Glencore up 3.1% and BHP Billiton up 2.6%.
Great Portland Estates gained 1.4% after the property developer said it agreed to sell 60 Great Portland Street in central London for GBP102.2 million, in line with the valuation of the property in September 2015.
The FTSE 250-listed company said the property has been sold to Cityhold Office Partnership, a joint venture between TIAA-CREF General Account and the AP1 and AP2 Swedish national pension funds.
Myanmar-based social media and entertainment platform operator MySQUAR said its total user base was in excess of 2.0 million at the end of 2015.
The company said the rise brought its user base to two-and-a-half times the level it had been at the end of May 2015. MySQUAR traded up 10%, making it one of the best performers in the AIM All-Share index.
Private rented sector and regeneration property firm Sigma Capital Group said it expects to outpace market expectations for the full year following a strong second half.
Sigma Capital said its pretax profit for the year to the end of December is set to be around GBP2.0 million, significantly ahead of current market expectations. According to Morningstar, brokers expect the group to post a pretax profit of GBP1.5 million for the year.
Sigma said the second half had been very strong, with its delivery of new private rented sector units ahead of its original expectations. It added it remains well positioned for 2016, with its current work programmes in progress ahead of plan.
Sigma Capital shares traded up 10%.
Still ahead in the economic calendar, German unemployment is at 0855 GMT, UK construction purchasing managers' index is at 0930 GMT as is the Bank of England's credit conditions survey. At 1000 GMT is preliminary eurozone inflation reading for December. US Redbook index is at 1355 GMT, and the ISM New York index is at 1445 GMT.
By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1
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