Market Report: Burberry luxuriates on hopes China will ease tax

Planning on buying your next handbag in Beijing? Well you may want to hold on a bit. As talk spread yesterday that the Chinese government could be about to slash its taxes on luxury goods, the prospect of consumer demand in the country rising even faster left Burberry as one of the Footsie's must-have stocks.

China's luxury market is believed to be worth roughly $30bn and growing rapidly all the time. Nonetheless, reports emerging from the country claimed a cut in import duties on upmarket goods could be on the horizon as its leaders attempt to boost domestic consumption.

Given the rapid growth it has enjoyed from China, Burberry is always sensitive to developments there and the latest news saw it race up 44p to 1,437p.

The fashion retailer (whose latest campaign stars Birdsong actor Eddie Redmayne) was also given a helping hand by Goldman Sachs' scribblers raising their target price to a huge 2,604p – not far off double where it currently trades.

If that wasn't enough, the analysts also reiterated their belief that Burberry could become a takeover target, although this idea is hardly a new one.

Having slumped more than 100 points on Tuesday, the FTSE 100 managed to make a slight recovery, bouncing up 25.61 points to 5,791.41. It would have been higher if a number of stocks were not trading ex-dividend, with Lucky Strike maker British American Tobacco (down 65.5p to 3,126p) and Irish building materials firm CRH (down 22p to 1,263p) among those losing their payout attractions.

Ahead of Carnival's first-quarter results tomorrow, UBS's analysts claimed the fact the announcement was earlier than usual showed the group was "ready to talk" about the impact from the Costa Concordia tragedy. Keeping their "buy" recommendation, they said there could be "some relief now that management will quantify the impact and put a floor on concerns", as the cruise giant powered up 32p to 1,876p.

Sainsbury's jumped 3.9p higher to 292.9p following the news that the investment vehicle of the Lebanese prime minister Najib Mikati and his brother Taha has raised its stake to over 3 per cent, with talk claiming they were attracted by its property portfolio.

After shocking investors with a profits warning last November, Admiral's final results managed to provide a positive surprise. The insurer shot up 104p to 1,144p – a move of 10 per cent – after revealing a forecast-beating 13 per cent rise in its full-year pre-tax profits.

The results of the latest indices reshuffle were announced after the bell, and as expected the recent rally by Hargreaves Lansdown – which put on another 2.7p to 461.8p – saved it from relegation to the mid-tier index. However, Cairn Energy (down1.3p to 319.7p) and Essar Energy (up 5.4p to 107p) will be moving down when the changes are implemented at the end of next week, with Croda International and Aberdeen Asset Management – who rose 42p to 2,149p and 6.8p to 246.6p respectively – taking their place.

Cable & Wireless Worldwide set a new six-month high by charging up 7.5 per cent to 33.55p off the back of reports claiming Vodafone (which stayed steady at 170p) is getting nearer to submitting an approach. The move came after the telecoms firm was hit by fears earlier in the week that the mobile phones giant could choose to not make an offer ahead of Monday's "put up or shut up" deadline.

Perform shifted 2.1p higher to 272.1p as Credit Suisse revived bid talk around the digital media group.The Swiss broker reiterated its belief that, thanks in part to the company's large portfolio of sports rights, Perform is "likely [to] attract potential acquisition interest".

Positive tests meant Afren was confident enough to announce that production at its Okoro East oil field in Nigeria should start in the "near-term", and in response, the explorer was lifted 3p to 174p.

It was a definite contrast to Faroe Petroleum, however, which slumped 5.01 per cent to 156.5p on AIM after failing to find commercial oil in its T-Rex and Bolan prospects in the Norwegian Sea.

Elsewhere among the oil groups, Red Emperor and Range Resources surged up 31.66 per cent to 32.75p and 8.33 per cent to 13p respectively following a positive drilling update from their joint well in Somalia. Meanwhile, tiddler Matra Petroleum crept up 0.01p to 0.86p despite vague speculation a discounted fundraising could be on its way.

On the small-cap index, vague rumours were suggesting Punch Taverns – which closed 0.5p better off at 11.25p – might become a bid target, with the pubs group's mid-tier rival Mitchells & Butlers (up 3.3p to 256.6p) put forward as one possible aggressor. However, the tale was being greeted with much scepticism in the Square Mile.

Life and Style
Cooked up: reducing dietary animal fat might not be as healthy as government advice has led millions of people to believe
healthA look at how governments started advising incorrectly on diets
Neil Warnock
football'New' manager for Crystal Palace
REX/Eye Candy
ebooksAn evocation of the conflict through the eyes of those who lived through it
Roger Federer is greeted by Michael Jordan following his victory over Marinko Matosevic
tennisRoger Federer gets Michael Jordan's applause following tweener shot in win over Marinko Matosevic
peopleJustin Bieber accuses paparazzi of acting 'recklessly' after car crash
Arts and Entertainment
Oppressive atmosphere: the cast of 'Tyrant'
tvIntroducing Tyrant, one of the most hotly anticipated dramas of the year
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Client Services Executive / Account Executive - SW London

£23000 - £26000 per annum: Ashdown Group: Account Executive / Client Services ...

PA to CEO / Executive Secretary

£36000 - £38000 per annum: Ashdown Group: Executive PA to CEO & Executive Dire...

Generalist HR Administrator, Tunbridge Wells, Kent - £28,000.

£25000 - £28000 per annum: Ashdown Group: Generalist HR Administrator - Tunbri...

Senior C# Developer (.NET, C#, JMS, TDD, Web API, MVC, integrat

£45000 - £75000 per annum + benefits+bonus+package: Harrington Starr: Senior C...

Day In a Page

Kate Bush, Hammersmith Apollo music review: A preamble, then a coup de théâtre - and suddenly the long wait felt worth it

Kate Bush shows a voice untroubled by time

A preamble, then a coup de théâtre - and suddenly the long wait felt worth it
Robot sheepdog technology could be used to save people from burning buildings

The science of herding is cracked

Mathematical model would allow robots to be programmed to control crowds and save people from burning buildings
Tyrant: Is the world ready for a Middle Eastern 'Dallas'?

This tyrant doesn’t rule

It’s billed as a Middle Eastern ‘Dallas’, so why does Fox’s new drama have a white British star?
Rachael Lander interview: From strung out to playing strings

From strung out to playing strings

Award-winning cellist Rachael Lander’s career was almost destroyed by the alcohol she drank to fight stage fright. Now she’s playing with Elbow and Ellie Goulding
The science of saturated fat: A big fat surprise about nutrition?

A big fat surprise about nutrition?

The science linking saturated fats to heart disease and other health issues has never been sound. Nina Teicholz looks at how governments started advising incorrectly on diets
Emmys 2014 review: Can they genuinely compete with the Oscars

Can they genuinely compete with the Oscars?

The recent Emmy Awards are certainly glamorous, but they can't beat their movie cousins
On the road to nowhere: A Routemaster trip to remember

On the road to nowhere

A Routemaster trip to remember
Hotel India: Mumbai's Taj Mahal Palace leaves its darker days behind

Hotel India

Mumbai's Taj Mahal Palace leaves its darker days behind
10 best pencil cases

Back to school: 10 best pencil cases

Whether it’s their first day at school, uni or a new project, treat the student in your life to some smart stationery
Arsenal vs Besiktas Champions League qualifier: Gunners know battle with Turks is a season-defining fixture

Arsenal know battle with Besiktas is a season-defining fixture

Arsene Wenger admits his below-strength side will have to improve on last week’s show to pass tough test
Pete Jenson: Athletic Bilbao’s locals-only transfer policy shows success does not need to be bought

Pete Jenson: A Different League

Athletic Bilbao’s locals-only transfer policy shows success does not need to be bought
This guitar riff has been voted greatest of all time

The Greatest Guitar Riff of all time

Whole Lotta Votes from Radio 2 listeners
Britain’s superstar ballerina

Britain’s superstar ballerina

Alicia Markova danced... every night of the week and twice on Saturdays
Berlin's Furrie invasion

Berlin's Furrie invasion

2000 fans attended Eurofeurence
‘It was a tidal wave of terror’

‘It was a tidal wave of terror’

Driven to the edge by postpartum psychosis