Daily market update: Apple, Currys, John Lewis

The FTSE 100 managed to nudge higher on Thursday despite oil prices holding above $100 per barrel.

Asian shares saw heavy selling with the region particularly exposed to disrupted energy supplies from the Middle East.

Comments from Donald Trump suggest the chances of any diplomatic progress before the midterm elections in the US are looking slim, leaving markets to confront the prospect of oil prices remaining elevated for at least a couple of months.

In London some of the names most affected by the Middle East crisis, most notably in the travel and tourism sector, managed to claw back some ground.

US futures pointed to a higher open on Wall Street. The world’s largest economy benefits from its status as a net exporter of oil and gas.

Government bond yields have stabilised but continue to hover near multi-year highs as markets remain nervy.

Apple

Apple unveiling a $1,999 foldable phone seems a bold move in a tricky economy, although the unveiling didn’t take a bite out of its share price, with shareholders greeting the news with a shrug.

For all the fanfare around the launch, the real test is yet to come as we wait to see if people see past the price tag and feel it is a must-have bit of kit.

The company also increased prices on existing models, although not by as much as some analysts had predicted. This suggests Apple is choosing to absorb some of the extra cost of components to protect market share at the expense of margins.

Currys

Given the backdrop, consumer electronics retailer Currys has served up a reassuring update on trading under its new CEO Fredrik Tønnesen.

Growth is solid and the company is sticking with its full-year guidance. There’s not a lot to get pulses racing, but there will be relief that the outlook hasn’t notably worsened despite the pressures on household budgets. Strong cost control has helped to protect margins.

One possible concern might be that as temporary benefits from the World Cup and the summer heatwave which drove strong sales of cooling products fade, Currys might find it harder to sustain decent growth.

Tønnesen has a hard act to follow, with his predecessor Alex Baldock transforming the business in recent years.

Baldock’s strategy of helping people navigate an increasingly complex world of consumer technology through the lifecycle of a product – from credit services to repairs and recycling – has paid off. As has the decision to rebuff US firm Elliott when it attempted a takeover in March 2024 – with the shares having more than doubled since then.

While Currys offers credit services to customers, it is not exposed to risks around rising levels of bad debt because these are underwritten by a third party.

Currys benefits from being one of the last physical retailers of electronics of any scale. When people need some handholding it becomes an obvious destination, underpinning market share gains.

The new boss knows the business well given he spent a long period in the Nordic wing, but he is now fully in the spotlight.

John Lewis

The tentative recovery at John Lewis is now looking as fragile as one of its teapots as the company blames summer heatwaves for a slump in trading.

Pre-tax losses more than doubled in the first half of the year and that will ramp up the pressure ahead of the all-important Christmas season as the company looks to claw back profit in the second half. Waitrose is the main bright spot but is not sufficient to make up for the weakness elsewhere.

People are already putting off big discretionary purchases, and energy prices and rising mortgage costs could bite for households heading into autumn and winter.

John Lewis’ chair, Tesco alumni Jason Tarry, has a plan to revive the business but after the shock of the pandemic and the post-Covid cost of living crisis, this storied name in UK retail faces yet another big test.