FTSE 100 falls 1% as markets drop; retail sales hit by Omicron – business live | Business
Peloton is considering workforce cuts and production changes as investors hammered its share price after a report said it was considering halting the manufacture of its exercise bikes because of a slump in demand.
The company’s chief executive, John Foley, said a report by CNBC claiming that it plans to temporarily halt production of its exercise bike and treadmill products was “incomplete, out of context, and not reflective of Peloton’s strategy”.
However, Foley said in the message to Peloton’s 3,200 staff that the company needed to “evaluate” the size of its workforce and indicated that production curbs are on the way as he referred to “resetting” manufacturing.
Full story: Retail sales in Great Britain fall as Omicron keeps shoppers away
In a key month for retailers, sales volumes dropped by 3.7% in an across-the-board slump that included food, clothing and footwear, household goods and department stores.
Retailers had seen some Christmas spending brought forward to November when a 1% monthly rise was helped by Black Friday bargains.
Even so, the December fall was much sharper than the 0.6% drop forecast by the financial markets.
Bethany Beckett, a UK analyst at Capital Economics, said:
“The huge 3.7% month-on-month fall in retail sales in December was much bigger than we and the consensus had expected and supports our view that the surge in Omicron Covid-19 cases in the run-up to Christmas may have dragged down GDP by 0.5% month on month, if not more.”
Beckett added that the 4.7% monthly drop in fuel sales was consistent with people staying at home rather than risking a trip to the high street.
Scott Morrison has taken aim at China for “economic coercion”, foreign interference and cyber attacks in a speech to the Davos World Economic Forum.
Without naming the source of “sharper geopolitical competition”, the Australian prime minister warned of increasing territorial disputes in the Indo-Pacific region and urged an end to protectionist measures directed at Australia.
Australia has been the target of Chinese tariffs on key agricultural exports, such as barley and wheat, due to a long series of grievances including “interference in China’s Xinjiang, Hong Kong and Taiwan affairs” and “spearheading the crusade against China in certain multilateral forums”.
Morrison told the forum that the global strategic environment had “deteriorated” with the world becoming more “fragmented and contested particularly here in the Indo-Pacific which has become the world’s strategic centre of gravity”.