ADVFN Morning London Market Report: Tuesday 30 March 2021

Share On Facebook
share on Linkedin
Print

London open: Stocks advance as investors look past Archegos collapse

© ADVFN

London stocks rose in early trade on Tuesday as investors looked past the Archegos Capital collapse.

At 0835 BST, the FTSE 100 was up 0.7% at 6,782.94.

Spreadex analyst Connor Campbell said: “Although Archegos uncertainties are still hanging over the markets, European investors felt settled enough to push the region’s indices higher on Tuesday.

“The FTSE was one of the stronger performers after the bell. With its key mining, oil and banking stocks all moving in the right direction.” He noted the index hit a 12-day high of 6,785.

Despite the positive tone, Campbell cautioned: “There are dangers lurking to undermine these month-end gains. As occurred when February came to a close, bond yields are on the rise.

“And though the markets have broadly made their peace with that in recent weeks, it could still cause a record high-imperilling wobble. Similarly, just because markets appear to have moved on this morning, doesn’t mean the dust has settled on Archegos Capital’s collapse. That situation could still have some nasty surprises up its sleeve.”

In corporate newsRoyal Mail rallied after saying it would pay a one-off dividend and held full-year profits guidance as it outlined plans to more than double profits at its GLS parcels unit in the next five years. The letter and parcels delivery company will pay shareholders 10p a share in response to a surge in parcels deliveries from online shopping during the Covid pandemic. It added that annual group adjusted operating profit is still expected to be around £700m.

Cairn Energy pushed up even after it said India has appealed against an order by an international tribunal to pay $1.2bn damages to the company in a long-running tax dispute.

Entain was boosted by an upgrade to ‘overweigh’ at JPMorgan, but 888 was knocked lower by a downgrade to ‘neutral’ by the same outfit as it took a look at online gaming stocks.

Polymer maker Victrex gained after an upgrade to ‘neutral’ at Citi, which pointed to the first signs of volume growth “as many of its key end markets look to be through trough levels”.

Imperial Brands ticked a little lower even after it backed its full-year guidance as it hailed a good start to the year, with market share growth in its five priority markets.

 

Top 10 FTSE 100 Risers

Sponsored by
ii
Buy Sell
76.4% of retail CFD accounts lose money.
# Name Change Pct Change Cur Price
1 Easyjet Plc +3.52% +33.00 971.00
2 International Consolidated Airlines Group S.a. +3.43% +6.60 198.80
3 Legal & General Group Plc +3.01% +8.30 284.10
4 Antofagasta Plc +2.84% +47.00 1,699.50
5 Whitbread Plc +2.52% +86.00 3,503.00
6 Barclays Plc +2.49% +4.50 184.88
7 Melrose Industries Plc +2.40% +3.95 168.60
8 Evraz Plc +2.35% +13.20 574.80
9 Hsbc Holdings Plc +2.26% +9.45 427.55
10 Prudential Plc +2.20% +34.00 1,577.50

 

Top 10 FTSE 100 Fallers

Sponsored by
ii
Buy Sell
76.4% of retail CFD accounts lose money.
# Name Change Pct Change Cur Price
1 Severn Trent Plc -1.54% -36.00 2,306.00
2 Bunzl Plc -1.13% -26.00 2,272.00
3 Rentokil Initial Plc -1.10% -5.40 487.00
4 Imperial Brands Plc -0.86% -13.00 1,498.50
5 National Grid Plc -0.85% -7.40 862.60
6 Hikma Pharmaceuticals Plc -0.81% -18.00 2,195.00
7 Astrazeneca Plc -0.81% -60.00 7,334.00
8 Smith & Nephew Plc -0.80% -11.00 1,365.00
9 Experian Plc -0.71% -18.00 2,503.00
10 Sse Plc -0.69% -10.00 1,446.00

 

Europe open: Shares brush off Archegos worries

European shares opened higher on Tuesday as investors shrugged off worries over the troubles at Archegos Capital and focused on the prospects of a post Covid pandemic economic recovery.

The pan-European STOXX 600 index rose 0.54% by 0841 BST with all major regional bourses on the rise. Britain’s FTSE 100 outperformed, up 0.76% to a 12-day high as banks and miners found favour. A 0.76% increase in Germany’s DAX sent the index past 14,900 for the first time.

“Though Archegos uncertainties are still hanging over the markets, European investors felt settled enough to push the region’s indices higher on Tuesday,” said Spreadex analyst Connor Campbell.

“There are dangers lurking to undermine these month-end gains. As occurred when February came to a close, bond yields are on the rise. And though the markets have broadly made their peace with that in recent weeks, it could still cause a record high-imperilling wobble.”

“Similarly, just because markets appear to have moved on this morning, doesn’t mean the dust has settled on Archego Capital’s collapse. That situation could still have some nasty surprises up its sleeve.”

Swiss lender Credit Suisse rallied 1.12% after a 14% slump on Monday as the bank warned of “highly significant and material” losses after the fund, named by sources as Archegos, defaulted on margin calls.

Spanish mobile phone mast operator Cellnex rose about 1.5% after it launched a €7bn capital raise.

Shares in British letter and parcel carrier Royal Mail were up more than 2% as the company announced a one-off dividend and said it planned to more than double profits at its GLS parcels division in the next five years thanks to a boom in online shopping during the coronavirus pandemic.

Water group Pennon fell as the company said it was on track to deliver “resilient financial results” in line with management expectations.

 

US close: Dow registers record close in mixed trading session

Wall Street stocks turned in a mixed performance on Monday following a fresh record close for the S&P 500 in the final session of the previous week.

At the close, the Dow Jones Industrial Average was up 0.30% at 33,171.37, while the S&P 500 was 0.09% weaker at 3,971.09 and the Nasdaq Composite saw out the session 0.60% softer at 13,059.65.

The Dow closed 98.49 points higher on Monday, hitting a new record and extending gains recorded on Friday after a rush of broad-based buying in the dying minutes of trading.

Market participants prepped for increased volatility during the Easter holiday-shortened week on Monday, with quarter-end rebalancing among pension funds and other big investors as still elevated bond yields were seen as setting up money managers to make large adjustments to their portfolios.

Wall Street traders were also holding out until Wednesday for an update from Joe Biden on his infrastructure plan, said to cost more than $3.0trn, after White House press secretary Jen Psaki said over the weekend that the President intends to roll out two packages over the coming months – the first covering infrastructure and the second health and family care.

On the macro front, March’s Dallas Fed manufacturing index surged 28 points to 48.0, its highest reading in the survey’s 17-year history, as perceptions of broader business conditions improved markedly throughout the month.

In the corporate space, Credit Suisse shares were down after warnings that its first-quarter results would take a “significant” hit on the back of exiting hedge fund positions related to last week’s Archegos-linked forced selling, while Nomura shares slumped 14% after it cautioned it could meet a similar fate.

 

Tuesday newspaper round-up: Archegos, retailers, Liberty Steel

Financial regulators across the world are monitoring the collapse of the New York-based billionaire Bill Hwang’s personal hedge fund. The sudden liquidation of Hwang’s Archegos Capital Management sparked a fire sale of more than $20bn assets that has left some of the world’s biggest investment banks nursing billions of dollars of losses. – Guardian

Some of Britain’s best-known fashion and retail names are campaigning for the government to launch a ‘shop out to help out’ scheme to aid beleaguered independent shops as they prepare to reopen on 12 April. The retail consultant Mary Portas, the beauty mogul Charlotte Tilbury, the designers Charlie Casely-Hayford and Henry Holland, who has also designed the campaign’s logo, are among those calling for a stimulus package. They argue support should take a similar structure to last summer’s eat out to help out scheme, with the government covering 50% of the cost of goods bought at physical stores with fewer than 10 employees, capped at £10, every Monday to Wednesday, for a month this summer. – Guardian

London is poised to lead a national crunch in house prices as Covid and the stamp duty holiday risk pushing the market up to unsustainable levels, top economists have warned. The pandemic sparked the deepest recession in 300 years, but the housing market was spared the expected slump by unprecedented measures to prop up incomes, via furlough, and support property sales with a tax cut. – Telegraph

Transatlantic exports including gold necklaces, kitchen tables and chess boards could face US tariffs after Washington drew up plans to target a £236 million catalogue of British goods. Having inherited a spat over online taxation from the Trump administration, President Biden has opted to hold Britain’s feet to the fire. His officials concluded that Britain’s unilateral digital services levy on the big technology groups was “unreasonable or discriminatory” and placed a burden on companies in the United States. – The Times

Liberty Steel UK, the British business that is part of Sanjeev Gupta’s industrial group GFG Alliance, will go back into production after Easter as talks continue with the administrators of Greensill, its collapsed main backer, in an attempt to refinance the company. The announcement that Liberty Steel UK, which employs 3,000 people, half of them at Rotherham and nearby Stocksbridge in Yorkshire, is going back to work next Tuesday came as Gupta released a podcast to his employees to reassure them the company can survive. – The Times

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

This area of the ADVFN.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ADVFN.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.

Leave A Reply

 
Do you want to write for our Newspaper? Get in touch: newspaper@advfn.com

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V: D:20210613 14:01:22