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London open: Stocks rise on solid US cues, amid weaker pound
London stocks rose in early trade on Tuesday, taking their cue from a solid session on Wall Street, while a weaker pound also helped.
At 0850 GMT, the FTSE 100 was up 0.6% at 6,791.13.
Spreadex analyst Connor Campbell said: “With the Dow Jones closing above 32,900, Europe felt confident this Tuesday in reclaiming some of the ground given up following Monday’s spate of Oxford vaccine suspensions.
“As sterling weakened against dollar and euro alike – cable felt half a percent, while the pound shed 0.4% against its single currency rival – the FTSE was free to push back towards 6,800.
“At present the Dow Jones futures are keeping their cards close to their chest, with the index forecast to open flat this afternoon. The Dow could look increasingly jittery as Wednesday’s Federal Reserve meeting approaches – though if bond yields continue to pull back, the index could go into tomorrow night above 33,000.”
In equity markets, Greggs rallied after the bakery chain – famous for its sausage rolls – swung to an annual loss in 2020 for the first time in its history as its sales were hit by closures related to the Covid-19 pandemic, but said trading so far this year was better than expected. It posted a pre-tax loss of £13.7m, having said in January that the loss could be as much as £15m.
Retirement products specialist Just Group advanced as it posted an 11% jump in full-year earnings, while C&C fizzed higher as the premium drinks company sounded an optimistic note on its outlook.
On the downside, NatWest lost ground after the Financial Conduct Authority started criminal proceedings against the bank for money laundering. The FCA said NatWest allegedly accepted “increasingly large cash deposits” totalling £365m into the accounts of a UK incorporated customer between November 2011 and October 2016, including £264m in cash.
4Imprint tumbled as it reported a 93% slump in full-year profit, while Wizz Air tanked after US private equity firm and its largest shareholder, Indigo Partners, sold just over 7.69m shares in the budget airline in a placing.
Sabre Insurance and Wood Group were also weaker after full-year results.
Top 10 FTSE 100 Risers
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| 76.4% of retail CFD accounts lose money. | |
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Astrazeneca Plc | +3.38% | +236.00 | 7,214.00 |
| 2 |  |
Rolls-royce Holdings Plc | +2.92% | +3.45 | 121.45 |
| 3 |  |
Land Securities Group Plc | +2.83% | +19.20 | 697.70 |
| 4 |  |
Melrose Industries Plc | +2.69% | +4.80 | 183.00 |
| 5 |  |
British Land Company Plc | +2.52% | +12.80 | 521.40 |
| 6 |  |
Associated British Foods Plc | +2.44% | +60.00 | 2,516.00 |
| 7 |  |
Barclays Plc | +2.39% | +4.30 | 184.58 |
| 8 |  |
Schroders Plc | +2.34% | +79.00 | 3,460.00 |
| 9 |  |
Centrica Plc | +2.26% | +1.24 | 56.22 |
| 10 |  |
Scottish Mortgage Investment Trust Plc | +2.25% | +26.00 | 1,184.00 |
Top 10 FTSE 100 Fallers
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| 76.4% of retail CFD accounts lose money. | |
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Anglo American Plc | -1.43% | -43.00 | 2,954.00 |
| 2 |  |
Burberry Group Plc | -1.37% | -29.00 | 2,083.00 |
| 3 |  |
Tui Ag | -0.87% | -3.80 | 432.30 |
| 4 |  |
Antofagasta Plc | -0.86% | -15.00 | 1,721.50 |
| 5 |  |
Royal Dutch Shell Plc | -0.75% | -11.60 | 1,538.80 |
| 6 |  |
Bhp Group Plc | -0.66% | -14.00 | 2,120.50 |
| 7 |  |
Bp Plc | -0.65% | -2.05 | 314.10 |
| 8 |  |
Flutter Entertainment Plc | -0.62% | -105.00 | 16,770.00 |
| 9 |  |
Royal Dutch Shell Plc | -0.57% | -8.40 | 1,478.00 |
| 10 |  |
Compass Group Plc | -0.40% | -6.50 | 1,600.50 |
US close: Dow Jones and S&P 500 close at new record highs
Wall Street stocks closed higher on Monday, with the Dow Jones and S&P 500 closing at record highs yet again thanks to heightened optimism over the US’ economic reopening.
At the close, the Dow Jones was up 0.53% at 32,953.46, while the S&P 500 was 0.65% firmer at 3,968.94 and the Nasdaq Composite saw out the session 1.05% stronger at 13,459.71.
The Dow closed 174.82 points higher on Monday after the US 10-year Treasury hit its highest level since February 2020 on Friday, reaching 1.642%. While yields still remained elevated on Monday, they had come off the aforementioned high after the open on Monday, trading down at around 1.61%.
Boosting sentiment Monday was news that the Internal Revenue Service had begun processing $1,400 direct payments to Americans over the weekend.
Also in focus, air travel in the US hit its highest level in more than twelve months over the weekend amid the US’ Covid-19 vaccine roll-out, helping stocks most likely to benefit from a swift economic recovery from the Covid-19 pandemic lead gains at the open, with American Airlines and United Airlines both up more than 8%.
On the macro front, manufacturing activity in the New York jurisdiction improved more than expected in March, according to a survey released on Monday. The New York Fed’s Empire State index rose to 17.4 from 12.1 in February, beating expectations for a reading of 14.5 and hitting its highest level since last summer. This was also the ninth consecutive positive reading.
Market participants were also patiently awaiting a decision on interest rates from the Federal Reserve on Wednesday, with the bond market likely to take cues from the central bank in the week to come.
No major corporate earnings were released on Monday.
Tuesday newspaper round-up: Tesla, Thorntons, Screwfix
Yorkshire Building Society will become the first lender to relaunch 95% mortgages in the mainstream market, nearly a year after the pandemic spooked lenders into withdrawing low-deposit home loans. However, the deal will only be available to first-time buyers and the society will apply strict conditions on lending, including ruling out flats and new-build homes. – Guardian
Elon Musk’s Tesla lobbied the UK government to raise taxes on petrol and diesel cars in order to fund bigger subsidies for electric vehicles, alongside a ban on hybrids. The US electric car pioneer called for a rise in fuel duty and a charge on petrol and diesel car purchases to pay for grants and tax breaks such as a VAT exemption for battery-powered cars, according to submissions to the government seen by the Guardian. – Guardian
Broadband providers have lashed out at the communications watchdog over data-sharing proposals that could force them to cede more power to Silicon Valley tech giants. Ofcom faces a backlash over its Open Communications scheme, which is designed to help customers switch providers and boost innovation by making providers share data with third parties. – Telegraph
Chocolate seller Thorntons is the latest retailer to disappear from the high street, more than a century after it started life, putting 600 jobs at risk. The firm’s retreat could lead to all 61 UK stores being closed permanently after sales were hammered by the pandemic. – Telegraph
Screwfix plans to open 50 more shops in the UK and Ireland, creating 600 jobs because of the surge in demand for home improvements during lockdowns. The trade retailer, part of the FTSE 100-listed Kingfisher group, said that roles would be available in retail management, service assistants and supervisors as of January next year. – The Times
