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London open: Stocks in the black after Wall Street rally
London stocks advanced in early trade on Monday following a positive session in Asia and a late bounce-back on Wall Street at the end of last week, although worries remained about rising inflation and higher interest rates.
At 0840 GMT, the FTSE 100 was up 1.1% to 7,167.90, while the pound was up 0.1% against the dollar to 1.3842 and flat versus the euro at 1.1285.
London Capital Group analyst Jasper Lawler said: “Calmer winds were blowing across markets on Monday after last week’s typhoon. The calm in European share markets follows a less volatile session in Asia.”
He added: “There has been a cross-asset rebound off the lows with stocks, crude oil and currencies like the pound and euro all seeing gains. Still, investors will be aware the calm probably won’t last. A lack of clear catalysts from the earnings or economic calendar on Monday could be a mixed blessing if a bout of irrational selling returns.”
Market participants were mulling over the latest retail figures from Springboard/The British Retail Consortium, which showed footfall fell 1.6% in January, marking the worst outcome for the first month of the year since 2013, as customer numbers dropped 1.9%.
In addition, data from Visa showed that consumer spending was down 1.2% last month, marking the first January drop in five years.
On Tuesday, investors will be looking to the release of the latest UK inflation figures.
In corporate news, Barclays was higher as investors shrugged off news that its core banking business was being charged by the Serious Fraud Office over its fundraising deal with Qatar at the height of the financial crisis, adding to the charge already brought against the parent holding company and four former executives.
Wood Group rallied after saying it had won a new multi-million dollar, five-year contract to provide engineering and project management services on Saudi Aramco’s Marjan oil field.
FTSE 250 over-50s travel and insurance group Saga advanced after saying that it has signed a new reinsurance agreement with NewRe and Hannover Re and that trading continues to be in line with the guidance given in December 2017.
Euromoney was up after saying it sold its Global Marketa Intelligence unit for $180.5m in cash to a consortium.
Waste management company Renewi rose after saying that full-year trading would be in line with expectations following a positive second half.
BGEO gained as it said its board has approved the demerger announced last July and that its investment business, Georgia Capital, plans to increase its stake in Bank of Georgia to 19.9%, up from the previously announced 9.9%.
Acacia Mining slid as it scrapped its dividend and reported a drop in full-year earnings as it took a hit from an export ban by the Tanzanian government.
In broker note action, BP was boosted by an upgrade to ‘buy’ at Societe Generale, while Victrex racked up strong gains after a double upgrade to ‘buy’ at Bank of America Merrill Lynch.
Cineworld was higher after an upgrade to ‘buy’ at Peel Huntand Evraz gained on the back of an upgrade to ‘buy’ at Goldman Sachs.
Moneysupermarket ticked down as it was cut to ‘sector perform’ by RBC Capital Markets, while RELX nudged lower after a downgrade to ‘equalweight’ at Barclays.
