ADVFN Morning London Market Report: Friday 9 April 2021

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London open: Stocks nudge lower but weekly performance solid


London stocks nudged lower in early trade on Friday as the recent rally ran out of steam.

At 0845 BST, the FTSE 100 was down 0.2% at 6,927.59.

Neil Wilson, chief market analyst at, said: “The FTSE 100 is up around 3% this week after hitting its strongest since February 2020. It’s been a very good week for UK equities as the blue chips finally broke out to post-pandemic highs and the mid-caps on the FTSE 250 hit an all-time high.

“Lots of reasons behind the positive moves in UK equities this year: a vaccine rollout of immense success and an expected economic bounce back as activity returns towards normal both here in Britain and globally are supportive. But you could also look to the relative underperformance of UK equities as a factor – from a low bar they are finally catching up, you could say.”

In corporate news, Mike Ashley’s Frasers Group was a trading a little lower after saying it could face extra non-cash impairments of at least £200m due to “almost certain” further Covid-19 restrictions.

Tui slumped after the travel company said it was raising up to €400m (£348m) by selling convertible bonds to strengthen its finances during continuing travel restrictions caused by the Covid-19 crisis.

British American Tobacco was knocked lower by a downgrade to ‘neutral’ at JPMorgan, while BAE Systems was hit by a downgrade to ‘neutral’ at Exane.

Babcock International slid after The Financial Times reported that the defence contractor is bracing for a big asset writedown.

On the upside, PageGroup surged to the top of the FTSE 250 as the recruiter said improving trading made it more confident about the outlook and reported a 2% increase in first-quarter profit. Peer Hays also rose sharply.


Top 10 FTSE 100 Risers

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# Name Change Pct Change Cur Price
1 Spirax-sarco Engineering Plc +2.26% +270.00 12,220.00
2 Compass Group Plc +2.06% +32.50 1,613.00
3 Rolls-royce Holdings Plc +1.48% +1.64 112.76
4 Burberry Group Plc +1.39% +28.00 2,037.00
5 Whitbread Plc +1.38% +48.00 3,516.00
6 Croda International Plc +1.23% +80.00 6,602.00
7 Next Plc +1.17% +96.00 8,302.00
8 Ferguson Plc +1.17% +108.00 9,376.00
9 Crh Plc +1.12% +39.00 3,524.00
10 Persimmon Plc +1.07% +34.00 3,199.00


Top 10 FTSE 100 Fallers

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# Name Change Pct Change Cur Price
1 Tui Ag -6.55% -26.00 371.20
2 British American Tobacco Plc -2.57% -73.50 2,785.00
3 Bae Systems Plc -2.32% -12.20 514.60
4 Imperial Brands Plc -1.73% -27.00 1,533.50
5 Morrison (wm) Supermarkets Plc -1.65% -3.05 181.25
6 Glencore Plc -1.55% -4.55 289.75
7 Anglo American Plc -1.36% -42.00 3,042.00
8 Bt Group Plc -1.29% -2.00 153.20
9 Standard Chartered Plc -1.13% -5.70 498.90
10 Glaxosmithkline Plc -1.10% -14.60 1,307.00


Europe open: Shares muted after record highs

European markets were subdued at the open on Friday morning, as investors looked for impetus after record highs in the previous session.

The pan-European Stoxx 600 was down 0.14% at 0725 GMT after a strong close on Wall Street. The S&P 500 reached another record closing high as Federal Reserve Chairman Jerome Powell called the economic recovery “uneven” in a signal that monetary policy would stay loose for the foreseeable future.

Powell was speaking after an unexpected spike in jobless claims which suggested the US economic recovery has not yet gained a stable footing, with the impact on the labour market likely to be post-pandemic.

“Much of this was due to the fact that many companies have accelerated their digital and online transformation programmes during the lockdowns, which will in turn reduce the number of jobs available as the technology savings kick in,” said interactive investor head of markets Richard Hunter.

“In that event, there would be a wide need for workers to retrain, and as such the US would not be returning to the same economy of a year ago as a result.”

On the European data front, German February industrial output fell 1.6% month on month, according to the Federal Statistics Office, and below a consensus forecasts of a 1.5% rise.

Investors were also concerned over the rollout of the AstraZeneca‘s Covid-19 vaccine as Australia, the Philippines and the African Union become the latest nations to stop its usage for people under 30 over fears about its possible link to blood clots.

In equity news, shares in Atlantia rose as the company said Spanish infrastructure group ACS had expressed interest in taking a surprise stake in its motorway unit.

Tui shares were on the slide, down almost 7%, after the travel group said it was raising up to €400m (£348m) by selling convertible bonds to strengthen its finances during continuing travel restrictions caused by the Covid-19 crisis.

Airbus shares were higher after the plane maker reported slightly higher deliveries in the first quarter.


US close: Tech plays among the gainers on Wall Street

Wall Street trading finished on a positive note on Thursday, as a sharper-than-expected increase in weekly jobless claims had little impact on major indices.

At the close, the Dow Jones Industrial Average was up 0.17% at 33,503.57, while the S&P 500 added 0.42% to 4,097.17 and the Nasdaq Composite gained 1.03% to 13,829.31.

The Dow Jones closed 57.31 points higher on Thursday, adding to the gains recorded on Wednesday, as investors digested minutes from the Federal Open Market Committee’s latest meeting.

The FOMC meeting minutes, which outlined plans to maintain the pace of asset purchases for some time as the central bank helps to support stable prices and maximum employment, remained in focus on Thursday, as did President Joe Biden’s $2.0trn infrastructure plan that includes a corporate tax rate hike to 28%.

Biden, who indicated on Wednesday that he was willing to negotiate on the proposed increase, views the hike as a key source of revenue for the White House’s infrastructure plan.

However, Republicans were claiming to be concerned about tax increases as the US begins to emerge from the Covid-19 pandemic.

On the macro front, initial jobless claims rose more than expected in the week ended 3 March despite signs of healing elsewhere in the jobs market.

According to the Labor Department, first-time claims came to 744,000, well above expectations for a print of 694,000 and an increase of 16,000 on the prior week’s upwardly revised reading of 728,000.

While the four-week moving average also edged higher, hitting 723,750 last week, continuing claims did provide some positive news, with the weekly total dropping by 16,000 to 3.73m – the lowest level for continuing claims since 21 March 2020.

In the corporate space, tech plays were in the green, with Amazon up 0.61%, Apple ahead 1.92%, Netflix 1.39% firmer, and Google owner Alphabet 0.7% higher.

Reopening plays, meanwhile, were below the waterline, with Royal Caribbean Cruises down 1.37%, Delta Air Lines descending 0.78%, and American Airlines 1.17% lower.


Friday newspaper round-up: Greensill Capital, Facebook, AstraZeneca

Rishi Sunak has been accused of trying to smooth the way for Greensill Capital to gain special access to emergency Covid loans after the release of text messages showing the chancellor told David Cameron he had “pushed the team” to see if it could happen. The Treasury also revealed that the former prime minister “informally” phoned two other ministers from the department, and sources said he sent “multiple” texts to Sunak’s personal phone. The Treasury refused to release those texts, saying they were sent “with an expectation of confidence”. – Guardian

Facebook has not notified the more-than 530m users whose details were exposed on a hacker forum in 2019 and has no plans to do so, according to company representatives. Business Insider reported last week that phone numbers and other details from Facebook user profiles were available in a public database. The social media company acknowledged in a blogpost on Tuesday that “malicious actors” had obtained the data prior to September 2019 by “scraping” profiles using a vulnerability in the platform’s tool for syncing contacts. Facebook has said it plugged the hole after identifying the problem at the time. – Guardian

AstraZeneca chief executive Pascal Soriot has come under fire from investors for failing to defend its coronavirus vaccine amid questions about its safety. Investors said that the Frenchman, who has been in Australia visiting his wife and children since Christmas, had not adequately communicated the benefits of AstraZeneca’s vaccine following fears it could be linked to rare brain clots. – Telegraph

Governments across the world would raise an extra $300 billion in revenue every year if US plans for a global minimum corporate tax rate of 21 per cent are adopted, experts have calculated. President Biden lifted hopes of a breakthrough in talks to end multinational tax avoidance this week by proposing to make US tech giants pay more tax in host countries in return for an agreement on a minimum global corporation tax rate. – The Times

Revolut has told its employees that they can spend up to two months a year working from abroad. The fast-growing British banking app, which has more than 2,000 staff, said the policy would allow its international workforce to spend more time with their families. – The Times


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