After yesterday’s drop in footfall, shoppers are returning to the high street today in greater numbers than last year.

New dat from MRI Software shows that footfall across all UK retail destinations had risen by +8% as of 12pm, compared to 27^th December 2023.

They report that shopper numbers on the high street is up 8.7% year-on-year, alongside a 7.3% increase in footfall at retail parks, and 7.2% at shopping centres.

This suggests that consumers are on the lookout for post-Christmas bargains, or restocking their fridges and cupboards after a flurry of festive feasting.

Shoppers are “shaking off their post-Christmas slumber”, says Jenni Matthews, marketing and insights director at MRI Software, adding:

Following a subdued start to the Boxing Day sales, this uplift is promising for for retail stores and destinations.

It’s expected that footfall will continue to rise as the day progresses and into the weekend as consumers restock on groceries, prepare for New Years celebrations, and hunt for Boxing Day bargains.

The London-listed mining company Gemfields said it had temporarily halted its ruby mining operation in Mozambique after groups “took advantage” of political unrest to set fire and attempt to invade its site, resulting in two fatalities.

Gemfields, one of the world’s largest miners of coloured gemstones, said that more than 200 people associated with illegal ruby mining attempted to invade the residential village built by the company next to its Montepuez Ruby Mining (MRM) operation in northern Mozambique on Christmas Eve.

The company, which is incorporated in Guernsey and is listed on the London and Johannesburg stock exchanges, said that the groups were trying to take advantage of the widespread civil unrest after the controversial and disputed recent national election.

Thames Water finances on ‘shaky ground’ even after debt restructuring

Anna Isaac

Thames Water’s finances are on “shaky grounds” even if it secures investor and court approval to restructure its debts, analysts have warned.

The company’s woe are set against an challenging outlook for the rest of the English and Welsh water sector too, according to financial services and research firm Morningstar.

While regulator Ofwat has greenlit significant bill increases for consumers of £31 a year on average up to 2030, companies may still face an uphill climb to secure the necessary investment to meet increasingly stringent standards.

Morningstar said in a research note:

“We believe the UK water utilities will still face considerable challenges over this period given the heightened environmental concerns and large funding needs for their capital programmes.”

Water companies have two months to lodge an appeal with the UK’s Competition and Markets authority if they believe the bill increases signed off by Ofwat before Christmas are unfair.

Still, even if other companies face higher borrowing costs and greater investment demands, Thames stands out as a troubled case. It is battling to secure court approval for a £3bn credit lifeline and it has said it needs to raise an additional £3.25bn in equity funding.

“However, both funding plans remain on shaky grounds as equity investors are concerned with the viability of the utility and the investability of the industry, while a smaller group of B-class debtholders oppose the emergency cash line as it will likely wipe out their investments in a restructuring scenario,” Morningstar said.

The South Korean won has dropped to a near-16 year low against the US dollar today, amid a political crisis in Seoul.

The won fell by 0.6% today, extending its recent losses, to 1,475 won to the dollar, its weakest level since March 2009.

The selloff came before South Korea’s opposition-controlled National Assembly voted to impeach the country’s acting leader, Han Duck-soo.

Han had only been South Korea’s caretaker leader since President Yoon Suk Yeol was impeached by the assembly after he imposed martial law earlier this month.

South Korea’s main opposition Democratic party filed the impeachment motion after Han refused to fill three vacant seats in the Constitutional Court, which is set to adjudicate Yoon’s impeachment trial.

Shares were also hit in Seoul, pulling the Kospi 200 index down by 0.75% today.

In Tokyo, Japan’s Nikkei share average has hit a five-month closing high today.

The Nikkei gained 1.8% today to finish at 40,821.16, its highest close since July 17, with investors optimistic they’ll see corporate growth in the coming year.

Kentaro Hayashi, senior strategist at Daiwa Securities, says:

“The market cheered recent news of domestic firms, such as merger talks between Honda and Nissan. That drove expectations that Japanese firms will continue to improve investor returns.”

Jasper Jolly

Away from the retail sector, Britain’s steel industry is calling on the government to buy more domestic produce, as it prepares for a major expansion of offshore wind generation.

Only 2% of the steel used in British offshore wind projects over the past five years was made in the UK, and the industry wants ministers to aim to dramatically increase that proportion.

The business secretary, Jonathan Reynolds, is preparing to publish a new steel strategy in the spring that will look at how to “increase steel capacity and capability in the UK” even as the industry struggles with the costs of decarbonising.

Gareth Stace, the UK Steel chief executive, said there was a “great opportunity” in offshore wind, but the industry wanted the Labour government to pledge to favour British-made steel in its procurement.

The number of UK retailers facing “critical” financial problems has risen by more than 25% in the last three months, new data shows.

Highlighting the pressures on the sector, after a disappointing Boxing Day, restructuring specialist Begbies Traynor has reported there were 2,124 retailers in “critical financial distress” in the first 11 weeks of the October-December quarter.

That’s a jump from 1696 in July-September, but slightly lower than the 2,142 recorded in the last quarter of 2023.

Begbies, the UK’s largest insolvency practitioner, says the quarter-on-quarter increase reflects subdued consumer confidence and rising costs.

Julie Palmer, partner at Begbies Traynor, says retailers are under ongoing pressures, including rising operational costs and squeezed consumer spending.

Palmer adds:

“Moreover, the weaker-than-expected retail sales performance in November, traditionally a critical month for the sector, further underscores the tough trading conditions, as consumers hold off on purchases amid low confidence and rising prices.

“Adding to this uncertainty, the measures announced in the Autumn Budget, including the planned increase to employers’ National Insurance Contributions, will significantly dial-up the challenges faced by these businesses. These changes, alongside increases to the Minimum Wage, will negatively impact cash flow and, consequently, we expect elevated insolvency levels across this sector during 2025.

“Even for more resilient businesses, the pressures remain relentless, and many will likely face financial challenges next year as they navigate these compounded difficulties.

Good morning, and welcome to our rolling coverage of business, the financial markets, and the world economy.

Cost-of-living pressures have been blamed for a drop in shoppers hitting the UK high street yesterday.

The traditional Boxing Day sales seem to have been something of a flop, with a 7.6% drop in footfall compared to 26th December 2023 as of 8pm last night, according to data from MRI Software.

Jenni Matthews, marketing and insights director at MRI Software, explains:

The decline in Boxing Day activity may reflect a shift in consumer behaviour, influenced by the ongoing cost-of-living crisis.

With footfall levels +18.1% higher in all UK retail destinations on Christmas Eve this year compared to Christmas Eve last year, suggesting that many shoppers concentrated much of their spending in a pre-Christmas rush.

There are other factors. For starters, online shopping means many retailers began their Boxing Day sales late on Christmas Day (handy for those sober enough to operate a computer or mobile phone).

Shoppers had been expected to spend £3.7bn on Boxing Day, only a 1.3% increase on last year.

Secondly, many stores remained closed on Boxing Day – including John Lewis, Marks & Spencer, Next and Aldi – to give their staff more of a Christmas break.

As Kien Tan, a senior retail adviser at PwC, puts it:

“The key thing about footfall numbers is that they don’t tell the whole story.

Lots of shops are now closed on Boxing Day. It used to be just John Lewis, but now Next, M&S and most big supermarkets close.”

Thirdly, rising concerns about Christmas consumerism may have encouraged some potential shoppers to stay at home.

Yesterday’s slump in the number of people tramping around the shops could show a return to the declining levels of excitement about Boxing Day that were recorded before the Covid-19 pandemic.

As Matthews explained to PA Media:

“We’ve got to bear in mind that (last year) was our first proper Christmas without any (Covid-19) restrictions or limitations.

“Figures have come out that things have stabilised, we’re almost back to what we saw pre-pandemic.”

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