London midday: Stocks extend gains as pound dips; Halma surges on results

London stocks had extended gains by midday on Tuesday, helped along by a weaker pound and some well-received corporate releases, as investors mulled mixed news on the trade front.

The FTSE 100 was up 1.2% at 7,397.80, while the pound was down 0.2% against the dollar and the euro at 1.2933 and 1.1676, respectively, ahead of a televised debate in which Prime Minister Boris Johnson will go head to head with Labour leader Jeremy Corbyn.

Market participants welcomed the Trump administration’s decision to issue a new three-month extension allowing US companies to keep doing business with China’s Huawei. Nevertheless, there wasn’t much to cheer in terms of trade progress after China said on Monday that it was pessimistic about the prospects a deal with the US.

Chris Beauchamp, chief market analyst at IG, said: "It is almost as if this is still a bull market. Disturbances in Hong Kong have failed to dent the bullish view, and with trade wars still mercifully quiet the indices appear to have taken the bit between their teeth - European indices are surging in impressive fashion, and even the FTSE 100 is powering higher.

"Today sees the first clash on TV between Jeremy Corbyn and Boris Johnson, a discussion likely to generate more heat than light. Both leaders know their polling has picked up of late, and will want to continue that move, while the poor Lib Dems will have to wait for another way of boosting their flagging position. There is still plenty of time to go, but one imagines Conservative Central Office will be very pleased with the overall position so far."

On home shores, the latest survey from the Confederation of British Industry showed that output in the manufacturing sector improved more than expected in November but remained weak.

The CBI’s total orders balance came in at -26 this month from -37 in October, beating expectations for a reading of -31 but still well below the long-run average of -13.

Anna Leach, CBI deputy chief economist, said: "While the thick fog of uncertainty from a no deal Brexit has lifted somewhat, the manufacturing sector remains under pressure from weak global trade and a subdued domestic economy.

"Order books remain below average, and output volumes continue to fall. When taking into account the deteriorating outlook for manufacturing globally, it’s clear that the outlook for the sector remains precarious.

"The General Election is an opportunity for all parties to explain how they will shore up our economy. Ratifying a Brexit deal and moving on to build a vibrant future relationship with our biggest trading partner, based on frictionless trade, will be vital - both for UK manufacturers, and business as a whole."

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said there was "no sign of a turnaround yet".

"The CBI’s industrial trends survey remains consistent with a deepening downturn in manufacturing output, despite the partial recovery of the total orders balance in November," he said.

In equity markets, safety, health and environmental technology group Halma rallied as it reported record first-half results thanks to revenue growth in all of its major regions and business sectors.

Intertek was boosted by an upgrade to ‘buy’ at Jefferies, while Meggitt was on the rise as it secured a six-year $130m requirements contract with the Defense Logistics Agency in Philadelphia for the supply of fuel bladders.

PureTech Health surged after shares of US biopharmaceutical company Karuna Therapeutics - in which it owns a 30% stake - rocketed in the previous session as a phase 2 trial of its schizophrenia treatment met its primary endpoint.

Home repairs and improvements business Homeserve traded up as it posted a rise in interim revenue and announced the acquisition of a controlling stake in US-based home experts business eLocal for around $140m.

Intermediate Capital gained after it said first-half assets under management rose 11% to €41.1bn as its diversification strategy continues to bear fruit.

On the downside, Equiniti tumbled as it warned that 2019 underlying earnings would be towards the lower end of market expectations due to weaker higher margin UK corporate activity.

Big Yellow was in the red as it reported a slow start to the third quarter, while Polypipe lost ground as it said underlying operating profit for the year would be "just below" its previous expectations.

Market Movers

FTSE 100 (UKX) 7,397.80 1.23%
FTSE 250 (MCX) 20,635.64 0.95%
techMARK (TASX) 4,045.64 1.00%

FTSE 100 - Risers

Halma (HLMA) 2,120.00p 11.67%
Intertek Group (ITRK) 5,554.00p 4.67%
NMC Health (NMC) 2,599.00p 3.79%
Hargreaves Lansdown (HL.) 1,840.00p 3.60%
Smiths Group (SMIN) 1,664.50p 3.22%
3i Group (III) 1,075.00p 3.07%
Experian (EXPN) 2,495.00p 2.80%
Standard Life Aberdeen (SLA) 318.60p 2.61%
Spirax-Sarco Engineering (SPX) 8,545.00p 2.52%
BHP Group (BHP) 1,728.20p 2.49%

FTSE 100 - Fallers

Fresnillo (FRES) 614.40p -1.63%
Ferguson (FERG) 6,780.00p -1.54%
Persimmon (PSN) 2,492.00p -0.80%
Smurfit Kappa Group (SKG) 2,712.00p -0.59%
SSE (SSE) 1,330.50p -0.45%
National Grid (NG.) 902.90p -0.43%
BT Group (BT.A) 191.82p -0.37%
SEGRO (SGRO) 865.80p -0.37%
Polymetal International (POLY) 1,181.50p -0.34%
Barratt Developments (BDEV) 653.60p -0.27%

FTSE 250 - Risers

PureTech Health (PRTC) 290.00p 16.47%
Homeserve (HSV) 1,285.00p 7.26%
Intermediate Capital Group (ICP) 1,585.00p 6.09%
Virgin Money UK (VMUK) 148.15p 5.29%
Spectris (SXS) 2,724.00p 4.85%
Grafton Group Units (GFTU) 858.50p 4.63%
GVC Holdings (GVC) 869.80p 3.84%
Cobham (COB) 160.55p 3.71%
Marks & Spencer Group (MKS) 187.95p 3.55%
Cineworld Group (CINE) 197.75p 3.53%

FTSE 250 - Fallers

Equiniti Group (EQN) 204.20p -10.20%
Drax Group (DRX) 286.40p -3.31%
TBC Bank Group (TBCG) 1,252.00p -3.25%
Big Yellow Group (BYG) 1,156.00p -3.02%
Card Factory (CARD) 158.10p -2.83%
Polypipe Group (PLP) 463.20p -2.77%
Vivo Energy (VVO) 122.40p -1.92%
Aston Martin Lagonda Global Holdings (AML) 464.20p -1.69%
Bakkavor Group (BAKK) 126.80p -1.55%
PZ Cussons (PZC) 199.00p -1.24%