London midday: Stocks extend gains; CRH rallies on update
London stocks had extended gains by midday on Wednesday, recovering from heavy losses in the previous session despite a continued slump in oil prices, as investors mulled the latest UK inflation data.
The FTSE 100 was 1.3% higher at 5,712.61, while sterling was up 0.6% against the dollar 1.2357 as figures from the Office for National Statistics showed UK consumer price inflation fell to 1.5% in March from 1.7% the month before as fuel and clothing prices fell in the run-up to the coronavirus lockdown. The data was in line with expectations.
ONS head of inflation Mike Hardie said: "Clothing prices normally rise between February and March as new year discounting ends.
"However, this year the price of clothes has eased due to some retailers offering discounts due to decreased footfall in stores before the lockdown started. The cost of raw materials for manufacturers fell significantly over the year, driven by a global fall in the price for crude oil, which is at its lowest level since early 2016."
Meanwhile, oil prices remained firmly in focus after Brent crude fell below $16 a barrel, hitting the lowest level since 1999.
"Oil futures prices should turn around once demand picks up for the physical product but that looks a couple of months away given the gradual lockdown easing policies afflicting most economies," said London Capital Group analyst Jasper Lawler.
In equity markets, building materials group CRH was the standout gainer after reporting a rise in first-quarter like-for-like sales and announcing a series of cost-cutting measures, including 25% pay cuts for leadership teams and board members. It also reaffirmed its final dividend of 63 cents a share.
Power generation company Drax was higher after saying that core profit for 2020 should be in line with market expectations despite a potential £60m hit from the coronavirus pandemic, although the customer business is expected to make a loss.
On the downside, British Gas owner Centrica was knocked lower by a downgrade to ‘hold’ from ‘buy’ at Jefferies, while Sage was hit by a downgrade to ‘sell’ at Goldman Sachs.
Market Movers
FTSE 100 (UKX) 5,712.61 1.27%
FTSE 250 (MCX) 15,479.96 0.52%
techMARK (TASX) 3,449.87 -0.43%
FTSE 100 - Risers
CRH (CRH) 2,292.00p 6.70%
Ashtead Group (AHT) 1,759.50p 5.01%
Polymetal International (POLY) 1,600.00p 4.68%
Fresnillo (FRES) 750.60p 4.25%
Ferguson (FERG) 5,254.00p 4.00%
Antofagasta (ANTO) 758.60p 3.80%
Intermediate Capital Group (ICP) 956.50p 3.57%
3i Group (III) 740.00p 3.35%
Berkeley Group Holdings (The) (BKG) 4,051.00p 3.11%
United Utilities Group (UU.) 910.80p 3.03%
FTSE 100 - Fallers
Centrica (CNA) 30.00p -4.34%
BAE Systems (BA.) 521.00p -2.54%
British Land Company (BLND) 381.30p -2.36%
International Consolidated Airlines Group SA (CDI) (IAG) 223.90p -2.18%
Sage Group (SGE) 613.40p -2.14%
Flutter Entertainment (FLTR) 8,734.00p -1.98%
Burberry Group (BRBY) 1,363.50p -1.84%
BT Group (BT.A) 113.90p -1.77%
Pearson (PSON) 454.90p -1.69%
Melrose Industries (MRO) 85.84p -1.29%
FTSE 250 - Risers
Premier Oil (PMO) 22.83p 8.87%
Drax Group (DRX) 212.40p 7.65%
Centamin (DI) (CEY) 150.90p 6.76%
Grafton Group Units (GFTU) 548.50p 6.20%
Future (FUTR) 1,006.00p 4.90%
Cairn Energy (CNE) 95.00p 4.68%
Airtel Africa (AAF) 37.65p 4.58%
Petropavlovsk (POG) 25.50p 4.51%
Safestore Holdings (SAFE) 700.00p 4.48%
Law Debenture Corp. (LWDB) 499.50p 4.28%
FTSE 250 - Fallers
Capita (CPI) 30.06p -6.30%
Hammerson (HMSO) 60.38p -4.70%
TUI AG Reg Shs (DI) (TUI) 307.70p -4.41%
Marston's (MARS) 33.42p -4.13%
G4S (GFS) 86.36p -4.07%
QinetiQ Group (QQ.) 319.60p -3.91%
C&C Group (CCR) 186.60p -3.72%
GVC Holdings (GVC) 674.00p -3.71%
Aston Martin Lagonda Global Holdings (AML) 51.05p -3.68%
Euromoney Institutional Investor (ERM) 805.00p -3.59%