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London stocks rose in early trade on Tuesday, helped along by a lacklustre pound and rising oil prices.
At 0840 BST, the FTSE 100 was up 0.4% to 7,431.18, while the pound was down 0.1% against the dollar to 1.3929 and flat versus the euro at 1.1415 ahead of the release of public sector net borrowing figures at 0930 BST and the CBI industrial trends survey at 1100 BST.
Spreadex analyst Connor Campbell said that since having “the life sucked out of it” by Bank of England governor Mark Carney’s dovish comments last week, the pound has shown little sign of recovering the momentum it displayed in the first half of the month. He felt the expected jump in public borrowing figures to £1.1bn is unlikely to give sterling a helping hand either.
Firmer oil prices have lent a hand to the UK stock benchmark, however, with West Texas Intermediate up 0.8% and Brent crude up 0.5%, helping to push BP and Shell higher.
Elsewhere, the London Stock Exchange was in the black after it reported first-quarter trading broadly in line with expectations before an annual shareholder meeting that will seek to draw a line under the group’s recent troubles.
Meggitt ticked up after announcing the sale of photo etching group Precision Micro for £22.5m in cash, while FTSE 250 defence technology group QinetiQ rallied after agreeing to buy German airborne training services provider EIS Aircraft Operations, currently part of EIS Aircraft Group, for €70m.
Polymetal gained after buying the 50% of the Prognoz silver project in Russia that it didn’t already own from Garden Ring Capital for $140m in shares.
On the downside, bookies Paddy Power and William Hill were under pressure following a report that a move to cut the maximum stake on gambling machines to £2 is set to be announced within weeks. According to the Times, Chancellor Philip Hammond is understood to have accepted expert recommendations that stakes for fixed-odd betting terminals should be reduced to £2. GVC Holdings and Rank Group also lost ground.
Melrose slipped as it said GKN’s profit and cash generation were below market expectations in the first three months of the year prior to the completion of the takeover earlier this month.
AstraZeneca was under the cosh after saying that a third-line cancer combination study had missed its primary endpoint.
Anglo American ticked down after cautioning that its earnings this year will be hit by around $300m to $400m due to problems at its Brazilian iron ore unit. Separately, the company also reported a 4% rise in total production for the first quarter.
Wealth manager St James’s Place fell as it posted a drop in first-quarter assets under management, but beat expectations with net inflows of £2.60bn versus consensus of £2.30bn.
BAE Systems was boosted by an upgrade to ‘buy’ at Berenberg, but Victrex was hit by a downgrade to ‘hold’ by the same outfit.
Card Factory, Dixons Carphone and Superdry all retreated after downgrades to ‘hold’ at Liberum, while shipbroker Clarkson was cut to ‘neutral’ by JPMorgan Cazenove.
