Hot Features
Premium
Register for Free to get streaming real-time quotes, interactive charts, live options flow, and more.
London open: Stocks rise as miners rally ahead of possible third meaningful vote
London stocks rose in early trade on Monday, with miners pacing the gains as all eyes remained firmly on any Brexit developments amid the possibility of a third meaningful vote on Brexit this week.
At 0830 GMT, the FTSE 100 was up 0.3% at 7,251.21, while the pound was flat against the dollar at 1.3285 and 0.3% weaker versus the euro at 1.1707.
Expectations of another vote on May’s Brexit deal have been tempered after Chancellor Philip Hammond suggested over the weekend that a third attempt to push the bill through the Commons could be delayed or shelved if there is not enough support from MPs.
In addition, reports indicate that some Tory rebels have told Theresa May they will only support her Brexit deal if she publicly commits to standing down as prime minister.
Oanda analyst Craig Erlam said: “May has suffered crushing defeats on her deal at the first two times of asking and with nothing having changed, questions are naturally arising about whether the PM will pull the third vote on Tuesday. Ultimately it comes down to how many Brexiteers will back her deal out of fear of Brexit never happening and whether she can get the DUP on board.
“It’s not just Brexit that’s putting the focus on the UK this week. The Bank of England meeting on Thursday as well as numerous economic reports on the labour market, inflation and consumer mean the UK is constantly going to be in the news. This should make for another volatile week for the pound, which continues to be well supported despite being 11 days from exit day without a deal in sight. It seems traders are banking on the EU accepting the UKs request for an extension at this stage.”
Investors were also digesting the latest survey from Rightmove, which showed annual house prices in the UK fell in March as the usual spring boost was overshadowed by Brexit uncertainty. House prices fell 0.8% on the year in March compared to a 0.2% increase in February.
On the month, growth slowed to 0.4% in March from 0.7%the month before. This marks the lowest average monthly rise at this time of year since 2011, and is considerably lower than the 0.9% average over the last seven years.
The survey found that London continued to be the main drag, with prices in the capital down 1.1% on the previous month. Outside London, prices remained more buoyant, with nine out of 11 regions seeing new-to-the-market sellers pricing higher.
Rightmove director and housing market analyst Miles Shipside said: “Buying activity remains cooler than usual, with hesitation as some buyers await a more settled political climate. There’s greater resilience the further away you get from the London market, and there’s a sound bedrock of demand for the right property at the right price, reinforced by ongoing housing needs combined with cheap mortgage borrowing.
“London and some of its commuter belt are suffering from a post – boom hangover, with prices now having to be far more sober to attract buyer interest. In contrast, North East prices never had the opportunity to become intoxicated by the capital city’s heady mix of high demand, low interest rates and higher salaries.”
In equity markets, miners were the standout gainers as copper prices rallied, with Rio, BHP, Anglo American, Antofagasta and Glencore all higher.
Shares in Footasylum surged 74% as it agreed to be bought by larger rival JD Sports Fashion for 82.5p per share in cash, around half the price at which it floated in late 2017.
AstraZeneca edged up after saying that the US Food and Drug Administration has granted orphan drug designation for potential lung-disease treatment saracatinib.
Domino’s Pizza was on the rise as it refuted refuted claims made in the Sunday Times that the company has been misleading investors about progress in negotiations with the pizza chain’s franchisees.
Outsourcer Serco advanced as it signed a seven-year, AUD115m contract with the South Australian Government to operate and manage a remand centre for its department for correctional services.
In broker note action, Hunting jumped to the top of the FTSE 250 on the back of an upgrade to ‘buy’ from ‘neutral’ at UBS, while Legal & General was boosted by an upgrade to ‘neutral’ at JPMorgan Cazenove and Rolls-Royce gained on an upgrade to ‘overweight’ at Morgan Stanley.
