ADVFN Morning London Market Report: Monday 19 December 2022

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London open: Stocks rise as energy sector rallies but recession fears remain


London stocks rose in early trade on Monday despite a weak Asian session, as energy shares rallied, but gains were unspectacular as recession fears continued to weigh.

At 0830 GMT, the FTSE 100 was up 0.2% at 7,346.57.

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: “As a chill settles on markets, there is not much sign of a sustained Santa rally instead there is still a lack of overall cheer with investors mulling more interest rate rises and the never-ending story of the pandemic. The winter wave of Covid crashing over China is proving unsettling with worries about an escalation of infections now outweighing hopes that the easing of restrictions would lead to a brighter outlook for the economy.

“Chinese business confidence has fallen to its lowest since January 2013, according to data from World Economics, and as consumers desert streets and hunker down, while companies brace for mass absences, the immediate outlook remains bleak.

She added: “Concerns that the US will be dragged into recession, as the Federal Reserve tries to tame the wild horse of inflation are still front and centre.”

There wasn’t much in the way of corporate news as we head towards the Christmas break, but oil giants Shell and BP gushed higher as oil prices rose.

Hospital group Spire Healthcare was in focus as it announced the acquisition of The Doctors Clinic Group, an integrated provider of occupational health and private GP services, for £12m.

JD Sports lost ground after announcing late on Friday that it had sold its interests in a number of fashion brands to Frasers Group for up to £47.5m.

Electricals retailer Currys was under the cosh after a downgrade to ‘hold’ at Investec.


Top 10 FTSE 100 Risers

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# Name Change Pct Change Cur Price
1 Fresnillo Plc +3.56% +30.40 884.80
2 Bp Plc +3.00% +13.65 469.05
3 Shell Plc +2.74% +61.50 2,304.50
4 Crh Plc +1.62% +51.50 3,223.00
5 Rolls-royce Holdings Plc +1.51% +1.32 88.65
6 Melrose Industries Plc +1.33% +1.65 125.70
7 Glencore Plc +1.26% +6.70 537.80
8 Smurfit Kappa Group Plc +1.09% +33.00 3,067.00
9 Antofagasta Plc +1.06% +15.50 1,473.50
10 Smith (ds) Plc +0.99% +3.10 314.80


Top 10 FTSE 100 Fallers

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# Name Change Pct Change Cur Price
1 Next Plc -1.64% -92.00 5,534.00
2 Mondi Plc -1.13% -16.00 1,402.00
3 Marks And Spencer Group Plc -1.05% -1.25 117.55
4 Auto Trader Group Plc -0.86% -4.60 529.80
5 Bt Group Plc -0.84% -0.95 112.00
6 Berkeley Group Holdings (the) Plc -0.79% -30.00 3,768.00
7 Ocado Group Plc -0.73% -4.60 625.00
8 Barratt Developments Plc -0.68% -2.70 397.00
9 Bunzl Plc -0.67% -19.00 2,834.00
10 Hikma Pharmaceuticals Plc -0.67% -10.00 1,493.50


Sunday newspaper round-up: Strikes, Lloyds, Aston Martin

Strikes by Border Force were threatening the first restriction free Christmas in over three years for millions of passengers. More than 1,000 members of the Public and Commercial Services (PCS) union were due to strike from Friday. People arriving in the UK might be made to wait in queues at passport controls for over two hours. Contingency plans also contemplated the possibility that they might be held on jets in order to avoid overcrowding in arrival halls. – The Sunday Times

The scale of losses incurred by Lloyds‘s retirement scheme may be as high as £10bn following the September meltdown in UK markets. Market conditions was left without any other option than to sell a large amount of its position in shares in a hurry. The details, which were linked to the use of so-called liability driven investments, were revealed to MPs by Henry Tapper, the partner of Stella Eastwood, head of group pensions at Lloyds. Although the lender has said that that scheme’s funding position has not been materially impacted, analysts believe it may have lost a fifth of its asset value. – Financial Mail on Sunday

Lawrence Stroll and his financial backers were edging closer to owning 30% of Aston Martin. That came after the purchase of around £50m-worth of shares in the carmaker over recent weeks. As a result, their stake stood at 27.9%. Stroll was understood to have no intention of launching a buyout of the carmaker. Chinese manufacturer Geely on the other hand had shown such interest as recently as mid-2022, but was rebuffed. Stroll’s coinvestors included JCB’s Lord Anthony Bamford and biotech billionaire Ernesto Bertarelli. – The Sunday Telegraph

UK house prices may be set to drop by as much as 8% in 2023, according to Halifax, after a rise of £55,000 in average values between March 2020 and August 2022. Such a decline would return them to roughly £258,295, where they were in April 2021. Savills meanwhile anticipated that if interest rates peaked at 4% and started easing back from mid-2024, then home values would begin to recover with the average house price recording a gain of 6% over the following five years. – The Financial Mail on Sunday


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