Bunzl, a world leader in distribution services, said underlying operating profit is expected to exceed prior estimates in the full year 2023.

The company had earlier indicated that its profit would experience a “moderate increase” compared to 2022, when taking into account constant exchange rates.

Bunzl shares were up 2.20% at the time of writing on Thursday.

Bunzl’s update further explains that, when taking into account the divestiture of the UK healthcare business, the overall Group revenue in 2023 is expected to show a decrease of 1 to 2% compared to 2022, considering constant exchange rates and currency fluctuations having minimal influence throughout the year.

“Bunzl delivers an early Christmas present for investors with a small upgrade to margin guidance. Revenue weakness was expected as COVID-related sales continued to normalise and tailwinds from higher inflation faded away,” said Matt Britzman, equity analyst at Hargreaves Lansdown.

The end-of-year update further explains that the company’s revenue in 2023 is projected to be broadly in line with 2022, considering constant exchange rates and excluding the impact of the divestiture of the UK healthcare business.

Within this, the anticipated growth in revenue from acquisitions is expected to balance out the anticipated decline in underlying revenue.

Bunzl’s CEO, Frank van Zanten, said on Thursday, “We welcome three new complementary businesses to the group today, taking the total acquisitions announced this year to 17. Over the last four years, we have committed a cumulative circa £1.7bn to acquisitions, reflecting a step-up in our spend and with our pipeline remaining active and supported by our strong balance sheet.”

Looking into the future, Matt Britzman said that “higher-margin acquisitions, along with some organic improvements, are doing their job to prop up the bottom line. As we move into 2024, comparable periods should ease on the top line, reflected in guidance for some revenue growth next year, which is likely ahead of most analysts’ forecasts”.

“Bunzl has a resilient product range and a highly cash-generative model. The key thing to watch is how organic growth plays out from here. Prolonged weakness in this area puts added pressure on acquisitions to do the hard  work”, Britzman added.

A wave of optimism lifted European stocks on Thursday after the Federal Reserve signalled the interest rate hiking cycle was over, and the central bank would start to cut rates in 2024.

Interest rate futures markets are pricing in up to six interest cuts by the Federal Reserve and European Central Bank in 2024, equating to 150bps in interest rate cuts.

The German DAX and French CAC hit intra-day all-time highs as the FTSE 100 rose 1.9% in early trade on Thursday.

“Equity markets have enjoyed a hearty boost after Federal Reserve chair Jay Powell indicated further rate rises were not needed. While the market was already pricing in rate cuts from 2024, investors welcomed Powell’s comments with open arms. Having it spelt out was music to their ears,” said Russ Mould, investment director at AJ Bell.

“The market has been waiting a long time for this pivot in monetary policy and it’s finally come. The news sent the Dow to a new record high and put the S&P within a whisker of the 4,766-closing price achieved on 31 December 2021, just before the sharp interest rate hiking cycle began.

“The attention now shifts to when we could see rate cuts and it looks like May could be the magic moment.”

On Thursday, markets were in a clear risk-on mode, with stocks surging higher and bond yields falling.

The optimism was reflected in a cyclical rally in FTSE 100 stocks, taking miners, housebuilders and retailers considerably higher.

Ocado was the top riser as the food distribution technology company cheered the prospect of lower interest rates. Ocado is classed as a tech stock by many and has suffered during the tightening cycle. Hopes of a lower risk-free rate in 2024 fired the stock up on Thursday, gaining 9%.

Antofagasta, Anglo American, Glencore and Rio Tinto added between 4%-7% as miners did much of the heavy lifting in the FTSE 100’s rally. Lowering borrowing costs will boost major construction projects and provide support for commodity prices and mining activities.

The same school of thought helped plant-hire company Ashtead 7% higher.

Other interest rate-sensitive sectors, including housebuilders and retailers, were among the risers as traders positioned for an improving environment for the consumer in 2024.

Taylor Wimpey jumped 4.5% and Barratt Developments gained 3.4%. DIY specialist Kingfisher jumped 6%, while Howden Joinery ticked 4% higher.

Currys shares were spreading festive cheer on Thursday as the retailer said trading was in line with expectations and was strengthening their balance sheet by selling its Greek business.

In addition, cash generated from operations rose to £172m in the half-year period to 28th October, which helped to dramatically reduce free cash outflow down to £10m from £86m.

Currys shares were 10.9% higher at the time of writing on Thursday.

There were like-for-like sales delines across their geographies, but the company said they were committed to bolstering the top line and growing margin in the coming period.

The Nordics reported sales fell 12% in the period, and the company has earmarked the segment for special attention going forward.

“Our priorities this year are simple: to get the Nordics back on track, to keep up the UK&I’s encouraging momentum, while strengthening our balance sheet and liquidity. We’re making good progress on all these in a still challenging economic environment,” said Alex Baldock, Group Chief Executive of Currys.

“In the Nordics, our trusted brands have delivered substantial gross margin gains, which combined with strong cost discipline have resulted in significantly improved profits. There’s still a long way back to healthy Nordics performance, but we’re on the way.

“In the UK&I, profits are in line with expectations, as we focus on more profitable sales and growing the services that drive margins and customer lifetime value. Credit, Care & Repair and iD Mobile are all performing strongly, while colleague engagement and customer satisfaction continue to rise.

Analysts were positive on today’s update from Currys. There is the recognition of the macro challenges for a company selling expensive discretionary goods in a cost-of-living crisis and Currys’ progress despite clear headwinds.

“It was a good day to release positive news with the market in such a buoyant mood and today’s announcement from Currys, while not unblemished, certainly represented progress from the electronics retailer,” said Russ Mould, investment director at AJ Bell.

“For more than a year Currys has been a tale of Nordic noir as its previously reliable Scandinavian business has been beset by competitive pressures. Margins for this region being back at their level from two years ago will reassure shareholders that Currys is starting to put its problems behind it.

“Revenue is under pressure across the board, and the company chalked up a first-half loss, but it is telling it felt confident enough to stick with full-year guidance – hinting the Christmas trading period must be off to a solid enough start.

“There may be no return to the lockdown period when people had the means and motivation to snap up new electronic goods but Currys will hope as pressures on household budgets start to ease, appetite for buying larger ticket items will return.”