ADVFN Morning London Market Report: Monday 27 July 2020

Share On Facebook
share on Linkedin

London open: Travel stocks pace the decline as Ryanair warns over second wave

© ADVFN

London stocks were a little lower in early trade on Monday amid concerns about a second wave of coronavirus infections and souring relations between the US and China, as gold prices surged.

At 0850 BST, the FTSE 100 was down 0.5% at 6,094.75, with airline and travel-related stocks under pressure after Ryanair posted a €185m loss for the three months to June and said a second wave of Covid-19 cases across Europe in late autumn was its “biggest fear right now”.

British Airways parent IAGeasyJet and Wizz Air were all trading lower, along with travel company TUI, cruise operator Carnival and InterContinental Hotels.

Sentiment was also hit by the UK’s announcement that travellers returning from Spain will now have to quarantine for 14 days after officials there warned a second wave could be imminent. The UK government also said other countries were under review.

Spreadex analyst Connor Campbell said: “Though it has been on the up and up all year – save a sharp downturn in the first couple of weeks of March – gold has really accelerated in the last week. From Monday to Monday is has surged 6.5%, with a 1.7% increase this morning lifting it above $1930 per ounce for the first time in history.

“Interestingly despite the precious metal’s major gains, the European indices weren’t too panicked post-open. The FTSE fell half a percent, ducking back under 6100, with the CAC down 0.4%, and the DAX unchanged at 12850.

“The main issue was the situation between the US and China, with Beijing swift in taking back the premises of the American consulate in Chengdu, only a day or do after announcing its closure. This, of course, follows Washington shuttering the Chinese consulate in Houston. Technically, the superpowers are all-square in this specific tete-a-tete – but investors are worried about what comes next.

“And this is not to forget the small matter of Covid-19 – you may have heard of it – with China posting its highest daily increase in new cases since April. This comes on top of fresh hotspots in Australia, Vietnam and Hong Kong.”

Elsewhere, engine maker Rolls-Royce was on the back foot following reports over the weekend that it is considering selling its ITP Aero division to private equity.

HSBC was in the red following a report it is under pressure to consider selling its US retail bank to boost returns and address international tensions with China.

On the upside, precious metals miners PolymetalFresnilloCentamin and Hochschild all shone as gold and silver prices rallied.

FTSE 250 IT provider Kainos shot higher after it announced a special dividend and said annual profit and revenue will be ahead of consensus expectations as trading from 1 April to date has been strong despite the impact of Covid-19.

Cairn Energy was also in the black as it agreed the sale of its Senegal assets to Lukoil for $400m in cash and announced plans for a special dividend of at least $250m.

 

Top 10 FTSE 100 Risers

Sponsored by
ii
76.4% of retail CFD accounts lose money.

 

# Name Change Pct Change Cur Price
1 Centrica Plc +3.67% +1.73 48.87
2 Antofagasta Plc +3.06% +31.50 1,060.50
3 Fresnillo Plc +2.85% +34.00 1,225.50
4 Bhp Group Plc +1.77% +30.20 1,740.00
5 Kingfisher Plc +1.57% +3.90 252.20
6 Severn Trent Plc +1.57% +38.00 2,460.00
7 Glencore Plc +1.55% +2.84 185.64
8 United Utilities Group Plc +1.41% +12.40 894.60
9 Anglo American Plc +1.38% +27.00 1,983.60
10 Dcc Plc +1.37% +96.00 7,104.00

 

Top 10 FTSE 100 Fallers

Sponsored by
ii
76.4% of retail CFD accounts lose money.

 

# Name Change Pct Change Cur Price
1 Tui Ag -13.37% -45.40 294.20
2 Easyjet Plc -11.75% -69.20 519.80
3 International Consolidated Airlines Group S.a. -9.67% -19.20 179.40
4 Carnival Plc -6.63% -63.20 890.20
5 Micro Focus International Plc -5.90% -17.80 283.80
6 Rolls-royce Holdings Plc -5.67% -15.20 252.90
7 Melrose Industries Plc -5.43% -5.67 98.68
8 Pearson Plc -4.96% -27.00 517.60
9 Intercontinental Hotels Group Plc -3.37% -127.00 3,641.00
10 Sage Group Plc -3.34% -25.00 723.20

 

Europe open: Stocks mixed in early trading even as euro and gold extend gains

Stocks in Europe have started the session slightly higher despite concerns around a possible second wave of Covid-19 infections and ongoing tensions between China and the US.

Underscoring the former, at the weekend the UK government imposed a 14-day quarantine period on travellers from Spain following a rash of outbreaks in the Mediterranean country centred on the Catalonia region.

Overnight meanwhile, Chinese authorities moved to close down the US consulate in Chengdu even as authorities in the country reported the largest flare-up of Covid-19 cases in over four months, with 61 infections, mostly in the west of China.

Echoing the mood in markets, European Central Bank governing council member, Fabio Panetta told La Repubblica that “it’s too soon to declare victory”.

As of 0807 BST, the benchmark Stoxx 600 was drifting lower by 0.17% to 366.66, alongside a 0.35% rise for the German Dax to 12,886.89 while the FTSE Mibtel had dipped 0.1% to 20,058.98.

In parallel, euro/dollar was 0.42% higher to 1.1705, alongside another sharp gain for gold futures which were last trading up by 1.78% to $1,959.50/oz..

Adding to the pressure on Travel&Leisure stocks, Ryanair Holdings posted a €185m loss for the three months to June and cautioned about the impact that a second wave of coronavirus infections might have, even as Europe’s largest budget carrier reiterated plans to gradually resume flights.

SAP AG reported a 1% increase in second quarter sales to reach €6.74bn for a 7% gain in earnings per share to €1.17 on a non-IFRS basis.

The German software provider also unveiled plans to float and list its Qualtrics unit in the US.

Germany’s IFO Institute will publish its widely-followed business consumer confidence for July, at 0900 BST, alongside M3 money supply figures from the European Central Bank covering the month of June.

 

 

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

This area of the ADVFN.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ADVFN.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.

Leave A Reply

 
Do you want to write for our Newspaper? Get in touch: newspaper@advfn.com

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V: D:20200810 06:03:04