With fears that the weekend's anticipated solution to the Eurozone crisis will only disappoint, as well as uninspiring Chinese data, markets are heading south again.
So it is unfortunate for Whitbread that a better than expected set of half year figures from the Premier Inn and Costa Coffee group have been caught up in the turmoil.
Whitbread said profits rose 15.2% to £179.6m, almost £8m more than analyst forecasts. It also boosted its interim dividend from 11.25p last year to 17.5p to demonstrate its confidence. And the share price reaction? A 7p fall to £16.20, although it is still outperforming the overall market which is down around 1%.
The star performer once more was Costa Coffee, with underlying profits up nearly 42% to £27.8m, helped by its Ice Cold Costa campaign during the summer with new drink flavours and international growth. It opened 167 new stores during the half year, including the 100th in China, taking the total to 2,000.
And if you thought the market for coffee shops was pretty much saturate, Costa's march onwards is set to continue with another 300 stores to be opened this year, and plans to take the total to 3,500 within five years. And on top of that come the Costa Express machines scattered around its estate and in the likes of Tesco and Welcome Break. In total it is targeting £1.3bn of sales from Costa.
Whitbread's hotels and restaurant division lifted profits by 8.5% to £167m, with 12 new hotels and five restaurants opened.
But despite the better results, Whitbread cannot entirely buck the difficult consumer environment, admitting month by month trading continued to be variable. And it said it was "on track to deliver full year results in line with expectations" which, given the forecast beating first half, could imply a more difficult second six months. Nigel Parson at Evolution Securities said:
Whitbread's value propositions are compelling for customers but this is better understood now by investors. The stock is up 9% relative to the market since the start of September ... however, it may now be vulnerable to profit-taking and canny investors may decide to wait for such an opportunity.
Overall, as Moody's warned on France's Triple-A credit rating due to the Eurozone debt crisis and China reported a slowdown in third quarter economic growth to its weakest pace since early 2009 - albeit still up 9.1% year on year - the FTSE 100 has fallen 61.37 points to 5375.33.
