ADVFN Morning London Market Report: Monday 11 October 2021

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London open: Stocks in the black as miners rally

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London stocks edged up in early trade on Monday, underpinned by a strong performance in the mining sector, as investors shifted their attention from the US jobs report last week to the inflation outlook.

At 0850 BST, the FTSE 100 was up 0.3% at 7,117.12.

Inflation was in focus again after Bank of England policymaker Michael Saunders said over the weekend that people should prepare for “significantly earlier” interest rate rises as inflation pressure mounts.

CMC Markets analyst Michael Hewson said: “He isn’t alone in thinking along these lines either after new Chief economist Huw Pill voiced concerns over longer lasting inflation, something that the UK tends to be especially vulnerable to, while Governor Andrew Bailey also appears to be leaning in that direction as well.”

In equity markets, miners were the standout gainers as metals price rose, with Anglo AmericanAntofagastaGlencoreBHP and Rio all higher.

AstraZeneca was a little weaker despite saying that its antibody cocktail to combat Covid-19 had achieved a “statistically significant reduction” in the virus or death in a phase 3 trial.

Drinks maker Britvic was knocked lower by a downgrade to ‘sector perform’ from ‘outperform’ at RBC Capital Markets.

Outside the FTSE 350, Asos shares tumbled after the online fashion retailer said in a surprise announcement that chief executive Nick Beighton was stepping down, as it posted a jump in full-year profit but warned that sales growth was set to slow as it highlighted supply chain challenges and cost pressures.

 

Top 10 FTSE 100 Risers

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# Name Change Pct Change Cur Price
1 Rio Tinto Plc +3.37% +166.00 5,095.00
2 Glencore Plc +3.25% +11.55 366.85
3 Anglo American Plc +3.23% +87.00 2,778.00
4 Antofagasta Plc +2.90% +39.50 1,403.00
5 Bhp Group Plc +2.85% +54.60 1,967.60
6 Royal Dutch Shell Plc +1.85% +31.80 1,746.40
7 Bp Plc +1.75% +6.20 359.75
8 Royal Dutch Shell Plc +1.55% +26.40 1,735.00
9 International Consolidated Airlines Group S.a. +1.49% +2.68 182.40
10 Hsbc Holdings Plc +1.44% +6.05 425.60

 

Top 10 FTSE 100 Fallers

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# Name Change Pct Change Cur Price
1 Tui Ag -4.57% -13.40 279.90
2 Carnival Plc -2.34% -38.00 1,582.80
3 Sainsbury (j) Plc -2.10% -6.20 289.40
4 Ashtead Group Plc -2.06% -116.00 5,508.00
5 Tesco Plc -2.01% -5.55 270.05
6 Ocado Group Plc -1.82% -29.50 1,595.00
7 Flutter Entertainment Plc -1.67% -240.00 14,115.00
8 Smiths Group Plc -1.48% -21.50 1,426.50
9 Ferguson Plc -1.39% -145.00 10,285.00
10 Segro Plc -1.37% -16.50 1,184.50

 

Europe open: Shares flat as oil prices surge, Asos slumps

European stocks were flat at the opening of the week as investors stayed on the sidelines ahead of the third quarter earnings season as commodity prices surged.

The pan-European Stoxx 600 index was down 0.03% in early trading with regional bourses mixed.

“Energy markets remain in sharp focus with all-time highs for Chinese coal echoing loudly this morning. Natural gas is steady around $5.70, though European prices remain volatile. Oil is higher again with WTI north of $81. Declining inventories, supply kept in check, demand recovering post the big summer Delta wave fear equal bullish for oil,” said Markets.com analyst Neil Wilson.

“US and inflation on deck this week will be the focus, but so too earnings season as it gets underway on Wall Street. The question facing investors is whether earnings calls are positive – supply chain woes, labour shortages, etc, and are we at peak inflation/stagflation/supply chain fear?”

In equity news, UK online fashion retailer ASOS plunged 15% after it said chief executive Nick Beighton was stepping down and warned of a 40% drop in profits for 2022.

Swiss drugs company Idorsia fell 5.48% a phase three study of its treatment for Fabry disease, which affects the nervous and cardiovascular system, failed to meet a primary endpoint.

German real estate investor Adler Group slipped 1.3% after it agreed to sell residential and commercial property worth €1.49bn to rival LEG Immobilien.

MorphoSys shares soared by 7.5% as its licensing partner Roche received breakthrough therapy designation by the US Food and Drug Administration for gantenerumab, a treatment for Alzheimer’s disease.

 

Monday newspaper round-up: Liberty Steel owner, FCA, rail chiefs, Glaxo

The owner of Liberty Steel has pledged to restart its plants in Rotherham and Stocksbridge in South Yorkshire this month, saving the “substantial majority” of 1,000 jobs, by pumping £50m in cash into the business. The move comes after Sanjeev Gupta’s conglomerate, GFG Alliance, said it had refinanced debts at its Australian steel and mining business. – Guardian

Britain’s financial regulator, accused of failing from “top to bottom” after a string of scandals, has paid out bonuses of more than £125m to its staff since 2016, the Observer can reveal. Campaigners said the payouts at the Financial Conduct Authority (FCA) were an “absolute insult” to savers who had lost their life savings because of the regulator’s systemic failings. – Guardian

Ministers have been accused of hypocrisy after bosses at Britain’s nationalised rail operator were handed an inflation-busting pay rise despite ordinary rail workers being forced to endure a two-year freeze on wages. Executives on the six-person board of DfT OLR Holdings, which runs the LNER and Northern rail networks, shared remuneration of £718,000 this year according to recent filed accounts, a rise of 5.7pc on 2020. – Telegraph

GlaxoSmithKline investors hoping for a change of heart were disappointed. The chairman, Sir Jonathan Symonds, is not a man for turning. Roughly 30 of the pharmaceutical giant’s biggest investors dialled into Zoom on Thursday afternoon. Billed as a crunch meeting to garner support for the board’s transformation plans, it was hosted by the Investor Forum, an influential group that forced Unilever to backtrack on shifting its headquarters to the Netherlands. – Telegraph

The City regulator is facing new criticism over its handling of the £237 million London Capital & Finance investment scandal from an independent commissioner. The Financial Conduct Authority is at risk of censure from the financial regulators complaints commissioner, who has been investigating decisions it made in the fallout from the affair. – The Times

 

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