The FTSE 100 fell on Thursday as investors reacted to the Federal Reserve chair’s downbeat assessment of the US economy overnight.

London’s leading index was down 0.4% at the time of writing.

“Federal Reserve chair Jerome Powell gave a pretty gloomy assessment at an event in Chicago – warning of rising prices and unemployment which sounds very much like a warning of the dreaded stagflation,” said AJ Bell investment director Russ Mould.

Powell’s comment shouldn’t have come as a surprise to market participants, but they were an unwelcome reality check. The Chair pointed to higher inflation this year and hinted that the Fed was not in a position to cut rates at this point.

Although the Federal Reserve showed little sign of cutting rates, the European Central Bank, as the first major central bank to meet in the wake of Donald Trump’s tariffs, took the opportunity to cut rates on Thursday ahead of any economic fallout as a result of tariffs.

“Although Europe has secured a 90-day reprieve from Trump’s global tariff policies, uncertainty remains high and is expected to weigh on growth,” said Bryan Conway, Director at Centrus.

“The fallout from escalating global trade tensions—particularly the intensifying US-China trade war—poses additional risks. There is growing concern that diverted goods from China could flood European markets, further dampening the region’s economic outlook. Compounding these challenges is the euro’s sharp appreciation against the US dollar since the Liberation Day announcement, which has drawn increasing concern from ECB officials.”

The FTSE 100 perked up as the US session got underway on Thursday, but still traded in negative territory.

Sainsbury’s was among the top risers following the release of a robust set of results and fresh share buyback. There will be concerns about the outlook amid a price war with discounts, but the rise in shares on Thursday suggests recent declines for the stock after a similar update by Tesco priced in the worry about earnings over the coming year.

“When Asda fired the opening salvos in a UK supermarket price war in mid-March the markets immediately sat up and took notice and the latest updates from Tesco and now Sainsbury’s suggest this was the right call,” Russ Moudl said.

“Like Tesco, Sainsbury’s wants to equip itself to protect its competitive position, hence its guidance for flat profit in the coming year as it looks to offer customers value for money. 

“The main winners in a price war would ultimately be shoppers, however, there were enough positive takeaways in the results to provide some cheer. The ‘food first’ strategy under Simon Roberts is clearly yielding real benefits with a healthy increase in the dividend providing shareholders with real sustenance.”

Fresnillo was the top faller as the company lost the rights to the latest ordinary dividend and a bumper special dividend.

Tekcapital portfolio company Guident has unveiled an autonomous vehicle pilot programme in downtown West Palm Beach as the company gears up for its proposed NASDAQ IPO this year.

The autonomous shuttle initiative, developed in partnership with Related Ross, Circuit Transit and Auve Tech, covering a 0.9-mile route, is open to the public from 17th April.

Palm Beach County commuters benefit from complimentary Royale access, sponsored by the local transport authority.

The project features the MiCa, a Level 4 fully autonomous electric shuttle created by Estonian firm Auve Tech, marking its first deployment in the United States. Guident provides the human-in-the-loop safety features required by many US states for autonomous vehicles.

“Launching the MiCa pilot in West Palm Beach represents a significant leap forward in autonomous technology,” said Harald Braun, Chairman and CEO of Guident.

“Our collaboration with our esteemed partners underlines a shared vision: to create a safer, more efficient, and connected urban future.”

While the company hasn’t signalled further rollout across the US yet, one would expect the West Palm Beach launch to gain the attention of other cities across the country that are seeking to improve mobility services.

The West Palm Beach launch comes as Guident prepares for a NASDAQ IPO this year amid a boom in autonomous vehicle investment rounds.

London-listed Tekcapital has a 70% stake in Guident, which could be worth more than its entire market cap when Guident successfully lists.

Sainsbury’s shares rose on Thursday after the supermarket released a robust set of results for the year to 1st March 2025.

The company’s focus on groceries has resulted in Sainsbury’s achieving its highest market share gains in more than a decade, which was evident in the numbers for the period.

Sainsbury’s reported full-year sales (excluding fuel) of £26.6 billion, up 4.2%, despite Argos experiencing a 2.7% decline to £4.9 billion and fuel sales dropping 8.9% to £4.7 billion.

Sainsbury’s Q4 sales grew 4.1% and Argos rebounded with 1.9% growth in Q4. The uptick in Argos sales is encouraging.

From a profitability perspective, the company delivered retail underlying operating profit of £1,036 million, up 7.2%, driven by double-digit growth in the Sainsbury’s business that helped offset lower Argos profits.

Statutory profit after tax increased significantly by 77% to £242 million, though this was impacted by non-underlying costs of £297 million related to Financial Services restructuring and retail reorganisation.

Sainsbury’s maintained strong cash generation with retail free cash flow of £531 million. Strong cash generation supported a fresh £200 million share buyback program, and increased its full-year dividend by 4% to 13.6 pence per share.

“After putting the majority of its eggs back in the grocery basket, Sainsbury’s renewed focus on what made it a dominant supermarket force has largely paid off,” said Mark Crouch, market analyst at investment platform eToro.

While investors will be pleased with results over the past year, there will be some concern about the outlook. The company said it expects retail underlying profit to be around £1 billion in 25/26, which is broadly the same as the £1.03bn recorded in 24/25.

“Looking ahead, guidance looks quite conservative at around 8% below market expectations, pointing to broadly flat revenue and profit this year,” said Aarin Chiekrie, equity analyst, Hargreaves Lansdown.

“That echoes conservative guidance from Tesco last week, and gives Sainsbury plenty of wiggle room to get its hands dirty if competition with the likes of ASDA and Tesco heats up. But shy of an all-out price war, there could be room for positive surprises as the year progresses. Shareholder returns remain a key part of the investment story though, with a new share buyback announced and plans to funnel the proceeds from its bank disposal back to investors via a special dividend.”

The share buyback and the relatively low level of the shares going into results will have played a part in shares rising on Thursday. Should the stock have been trading near the top of the recent range, we’d likely have seen shares sell off on the uninspiring outlook.

Sainsbury’s shares were 1% higher at the time of writing.

Maiden interim results from recently listed RC Fornax suggest the engineering firm’s shares should be avoided until they have fallen by at least a third.

The company raised £5m in an AIM IPO in early 2025 with plans to disrupt the defence sector solutions market. Unfortunately for investors, there is little sign of any major disruption of the market by the company in the half-year results to 28th February.

Revenue for the period grew just 8% compared to the same period last year.

Given that the company was founded in 2020 and has ample time to establish its presence in the marketplace, its growth rate suggests slow demand for its services. It also raises doubts about its ability to justify current rich valuations.

Slow top-line growth should be a major concern for investors, given the market in which RC Fornax operates. Other defence-related shares have seen sales boom in recent years as geopolitical tension bolsters defence spending by countries globally. Despite these strong tailwinds for the sector, RC Fornax revenues grew just 8%.

In addition to slow top-line growth, RC Fornax has very tight operating margins with revenue of £3.8m leading to just £600k in operating profit. Profit for the period was just £460k.

The outlook wasn’t bad, and the company believes it will meet expectations for the full year.

However, the share price requires the company to exceed expectations to justify the rich valuations. Assuming the company generates around £1m in profit this year, the current RC Fornax share price means the company is trading at around 21x earnings.

This isn’t overly expensive for a high-growth company. However, RC Fornax is not a high-growth company. Results demonstrate this.

For RC Fornax to trade in line with the wider market and on a similar forward multiple as other companies producing the same level of growth, shares must drop by at least a third.

The company has come to the market and provided investors with very little reason to be optimistic. RC Fornax has put little effort into investor engagement post IPO and seems content with meagre growth.

Cavendish has a 61p target for RC Fornax shares. This looks to be wildly optimistic.