1,302p +74p
Sage
226.5p +15.5p FROM mid-market fashion clothing to jewellery, the retail sector continues to feel the heat of consumer retrenchment.
Next yesterday revealed that like-for-like sales dived nearly 9 per cen
t in the first trading quarter of 2008. At the same time, jewellery chain Signet said its same-floorspace sales in the same period fell 2.5 per cent.
From Marks & Spencer to Debenhams, Homebase and B&Q to WH Smith and Currys, Moss Bros to Woolworths and JJB Sports, the message is the same: consumers are continuing to put purchases on hold.
Even if interest rates were held yesterday, previous cuts do not seem to be cutting much ice with depressed shopper confidence.
Similarly, possibly premature headlines this week that we may have turned the corner on the credit crunch and its associated woes for Joe Public are unlikely to have much positive effect.
In fact, it looks an increasingly decent bet that M&S boss Sir Stuart Rose may be not far off the money in predicting it might be 2010 before consumer confidence returns.
A swathe of customers have come off fixed-rate mortgages and been hit by rising mortgage costs as a result.
Utility bills remain high, and with oil at comfortably over $100 a barrel, that is unlikely to change in the short term. And many of the lower-paid have been badly hit by the scrapping of the starting 10p rate of income tax. Food costs have also gone up.
Many people are also getting worried about their job security as the credit crunch feeds through into the real economy and companies look for savings.
Taken in the round, what is there really to suggest that the prospects for the retail sector are likely to head up anytime soon?
Probably the only bright spot is that it is virtually certain retailers will benefit in the coming months from being up against very weak comparatives last year, when Britain endured its worse summer storms in hundreds of years.
It is probably the only cloud on the high street that has proved to have a silver lining.
COMPUTER software companies may not be hitting the heights of the dotcom boom, writes Scott Reid, but there have been signs of better pickings in recent times. Yesterday Sage Group, Britain's largest software business, highlighted this better trend.
First-half underlying profits have jumped 9 per cent to £138 million, with both the UK and mainland Europe doing well.
The fly in the ointment is America, where Sage is restructuring its problematic healthcare division against the backdrop of the sluggish stateside economy.
Revenues across the Atlantic are flat as a result, but the broad geographic spread of Sage's business has come to the rescue, with overall revenues up 9 per cent at £640m.
Sage's better-than-expected results may also say something about the state of mind of the small and medium-sized business sector to which it sells business management software.
So far it seems many businesses are keeping their nerve, and not reining in on IT expenditure.
It could be Sage's good fortune that its main product is accounting software, key for many businesses, but more importantly 60 per cent of its revenues are from subscription contracts, paid in advance.
Almost the business equivalent of having a fixed-rate mortgage, it allows the company to weather short-term economic challenges better.
Sage's shares put on 7.4 per cent yesterday, continuing a gentle recovery in recent months, and there looks the possibility for further advance, particularly once the healthcare arm is sorted out.
AS EXPECTED, the Bank of England kept rates on hold yesterday.
Threadneedle Street's latest non-move chimes with its vaguely-ambivalent desire to be seen as cognisant of the credit crunch-induced threat to the wider economy while not being perceived as panicking and stoking inflation.
The policy seems to be crystallising: the BoE monetary policy committee meets every month and cuts every second month.
The committee cut rates in December, and stayed its hand in January; cut again in February before taking no action in March. Then April saw another rate reduction, with May now passing without one.
For sure, bedraggled retailers (see above) and housebuilders in particular will be hoping for a boon in June.
SMALL BUT BEAUTIFULWind of change could be blowing for Novera EnergyTHE Takeover Panel, which issues and administers the City code on takeovers and mergers, has given Infinis and 3i Infrastructure until 2 June to reveal whether they intend to bid for Novera Energy.
The rival groups must either announce a firm intention to make a bid for Novera or say they do not wish to make an offer by 5pm on 2 June.
Both 3i and Infinis have signalled their interest in Novera but neither has yet to table a formal bid.
The Takeover Panel said that each of the parties had accepted its ruling.
Novera, which has a market value of about £115 million, said: "The board welcomes this ruling by the Takeover Panel and continues to recommend shareholders to take no action at this time".
Novera produces renewable energy. Its headquarters are in London and it has regional offices in Edinburgh.
The company runs ten hydro-electric schemes, 46 landfill sites from which it extracts methane and and a wind farm in Wales.
In Scotland, Novera runs a hydroelectric scheme near Ballachulish and has applied for planning permission for three wind farms, near Lochgilphead, Montrose and Glenkerie, in the Borders.
RUMOUR OF THE DAY
Baer facts of Standard's thoughtsSTANDARD Chartered, the UK bank, was last night rumoured to be considering a bid for Swiss rival Julius Baer.
One trader said: "There's a rumour doing the rounds that StanChart is to bid 105 Swiss francs (per share] for Julius Baer".
Standard Chartered declined to comment on the speculation.
A spokesman said the bank would "keep an eye on acquisition opportunities" but refused to comment on any specific takeover targets.
The UK bank recently grew its private banking business when it bought American Express Bank.
More than 90 per cent of Standard Chartered's profits are derived from emerging markets, including Asia, Africa and the Middle East.
The bank has 1,700 branches in 70 countries.
The full article contains 1055 words and appears in The Scotsman newspaper.
