NXT, IHG, MAB: Key stocks to explore as BoE announces bond-buying programme

September 29, 2022 11:35 PM AEST | By Abhishek Sharma

NXT, IHG, MAB: Key stocks to explore as BoE announces bond-buying programme — Image source: © Lassedesignen | Megapixl.com

Highlights:

The UK is witnessing financial chaos after the Chancellor's mini-budget.

On Wednesday, the benchmark index, FTSE 100, slipped to a 17-month low.

The UK market continued to decline on Thursday amid concerns that the government's huge tax cuts announced in the mini-budget will increase borrowing. This is despite prime minister Liz Truss defending the move, saying that cutting taxes is the right path for the country. Notably, the tax-cutting bonanza has triggered market chaos, and international organisations like the IMF have criticised the move.

Truss, however, has ruled out a U-turn on the policies, saying that "urgent action" was needed to get the economy growing.

The £45 billion tax cuts resulted in the pound sterling crashing to an all-time low against the US dollar. On Wednesday, the benchmark index, FTSE 100, slipped to a 17-month low. The Bank of England (BoE) has stepped in and announced a bond-buying programme to reduce the chaos and stabilise the financial markets. Calling it a temporary measure, the central bank said it set aside £65 billion to purchase bonds over the next 13 days.

There are concerns that the BoE will aggressively hike the interest rates due to the unfunded tax cuts and increased borrowing. The bank's chief economist Huw Pill has also hinted at a "significant monetary response" in the next meeting, which is scheduled for November.

Image source: © Wazzaroo | Megapixl.com

Amid this, let us explore few stocks that are in news today.

Next Plc (LON: NXT)

Shares of the British fashion retailer nosedived on Thursday after it slashed its revenue and profits forecast for the year due to fears of rising inflation. Its chief executive Simon Wolfson added that the currency crisis could worsen inflation in the year's second half, as most clothing and homeware factories priced their goods in US dollars. Shares of Next fell over 10% during the day and were trading at GBX 4,837.00, down 9.15% as of 12:17 pm GMT+1 on Thursday. NXT holds a market cap of £6,881.98 million and is a constituent of the FTSE 100 index.

InterContinental Hotels Group Plc (LON: IHG)

The Holiday Inn owner on Thursday announced that it has fully restored its systems after it suffered a cyberattack earlier this month. The company's booking systems were disrupted after hackers targeted them. Shares of the company were down 2.31% at GBX 4,438.00 as of 12:27 pm GMT+1 on Thursday. The FTSE 100 constituent currently holds a market cap of £8,200.71 million and has an EPS of 1.45. The share price has declined by 7% annually and year-to-date.

Mitchells & Butlers Plc (LON: MAB)

Shares of the British pub operator slipped to two-year lows after it warned of tighter margins in the next financial year due to the rising prices. The shares were down 7.48% at GBX 124.90 as of 12:40 pm GMT+1 on Thursday. The FTSE 250-listed company holds a market cap of £806.47 million and a negative EPS of -0.26.

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